mercoledì, giugno 13, 2007

Whose Growth?-elements for further writing.

Zimbabwe - Today, agricultural output is less than half of what it was at its peak in the late 1990s, and tobacco, the main export crop, is just one-fifth.

The budget deficit is an unsustainable 50 percent of gross domestic product. Inflation is now more than 3,700 percent. Four out of five Zimbabweans are unemployed. Half of the country's 11 million people are dependent on foreign food aid. More than three million people have fled the country. One in five of the population is afflicted with HIV or AIDS. Life expectancy is down from 60 at independence in 1980 to 36.

How then are a large number of people still making money?
The politically well-connected can purchase the U.S. dollar at the official rate of 250 Zimbabwe dollars at a time when the market rate is at least 100 times greater. This enables arbitrage on everything from luxury goods to essential imports, notably fuel from South Africa.
It does not matter that there is insufficient foreign exchange for basic food and power imports. The state relies on international largess in the form of aid and credits to ensure that these keep flowing.

If the perverse economic incentives on offer to his followers were removed, Mugabe could fall from power quickly. He might also find himself before the International Criminal Court, facing charges not only for his recent actions in Zimbabwe but also for those in Matabeleland in the early 1980s, which caused the deaths of more than 20,000 people. At 83 years of age, Mugabe has less to look forward to than he has to fear from his past.

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