Mugabe Looks Set To Lock Horns With Banks

Banks in Zimbabwe (Barclays pictured above), have set up a confrontation with Mugabe and his Inclusive Government by effectively telling the government to buzz off on the issue of loans to farmers for inputs. It rained in Harare and as far as the border with Mozambique (Nyamapanda), signalling the arrival of the ploughing and planting season. And Mugabe has warned the banks before, saying they were "sabotaging" the Land Reform Programme.

Harare, Zimbabwe, 29 September 2009

Here's a shocker.

Well, not really.

Banks in Zimbabwe are telling "new" farmers, beneficiaries of Mugabe's Land Reform Programme, that they do not recognise offer letters and 99 year leases given by Mugabe's government as security for loans being advanced to them for farming inputs.

This comes barely a month after the Inclusive Government made much noise about all this, as it emerged that we are woefully unprepared for this year's farming season. They announced earlier this month that banks would advance money for inputs on the strength of offer letters and the 99 year leases.

Except no one had bothered to tell the banks about this. So they are chasing the farmers away from their banking halls, saying they need title deeds before they can advance any money.

Mugabe's reaction is predictable. Last year, he and Gono warned banks that measures will be taken if they continued "sabotaging" the Programme.

But this episode merely exposes how clueless this government is about ending the suffering of Zimbabweans.

Clearly, the ministers involved were not competent enough to first consult with the banks, put an agreement in place and then go to the farmers and tell them to go and access the loans.

As it stands now, it appears that the mentality of a Command and Control economy is running deep still in both the MDC and ZANU PF.

The banks were supposed to do as they were told because a minister had spoken. There was no thought to the fact that these are actually businesses, these banks, who needed assurances on the viability of this move in order to avoid going bankrupt in the future.

But, having bankrupted the agriculture sector, this government thinks it has not done quite enough is also now asking the banks to take its chestnuts out of the fire, even if they should go under in the process.

We now also know that the presence of Morgan Tsvangirai and Arthur Mutambara has no effect on the way Mugabe does business. Do not be surprised if you hear that he is now going after those banks and forcing them to make those loans.

There were those who said before the Land Reform programme that he would not dare take land and not pay for it, that he would be committing political suicide and so on. He son proved them wrong.

We have come to think the unthinkable with Mugabe. The self-destructive streak seems to be strong.


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