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EU move will not help economy


The Europen Union (EU)’s proposal to suspend its targeted personal sanctions against 112 Zimbabweans is much ado about very little.

The sanctions, imposed a decade ago, have had no discernible impact either on the economy or on Zimbabwe’s politics.

The latest move from Brussels is another chapter in the long history of the failure of sanctions.

When three political parties signed a coalition agreement in September 2008 — including President Robert Mugabe’s Zanu-PF and the opposition Movement for Democratic Change — the EU response was that sanctions would not be lifted until all the terms of the agreement had been implemented.

Now Brussels has shifted the goalposts and, instead, the suspension of sanctions is contingent on the holding of a “credible” referendum on the draft constitution published on July 20, with no mention of other still-to-be-implemented reforms.

Immediate Zimbabwe reaction has been near-dismissive.

Justice Minister Patrick Chinamasa refused to comment until he had read the EU resolution.

Elton Mangoma, a senior member of Prime Minister Morgan Tsvangirai’s MDC, supported by most EU governments, complained that by suspending and not lifting sanctions immediately, “They (the EU) are not listening to us.”

US sanctions that target State-owned companies as well as individuals are more effective, but these will remain in place, suggesting that the Zimbabwe economy is unlikely to benefit from the change of heart in Brussels.

After three years of a strong recovery since dollarisation in early 2009, during which time growth has averaged almost 8% a year, the Zimbabwe economy is slowing under the impact of the worsening global economy, weaker commodity prices, depressed investment, a poor farming season and unmanageable balance of payments and Budget deficits.

Not even the most adroit Brussels or Whitehall spin doctor will be able to suggest that suspending personal sanctions will change this.

The EU’s conditionality — the holding of a credible constitutional referendum – looks like a formality. There is little enthusiasm in Zimbabwe for the draft constitution, described by politicians from all parties as “a flawed compromise”.

The expectation is that it will be approved in a referendum in October-November, but with a low turnout, which will make it hard for the EU to claim it has majority voter support.

However, having given so much ground in its support for political reform in Zimbabwe — the draft constitution is little different from the one currently in place, though it does limit the executive presidency to some degree — Brussels is likely to accept the outcome and lift the remaining sanctions, except those on the 88-year-old Mugabe and a few of his closest cronies.

More important — and impossible to call — is the electoral impact. Once a new constitution is in place there will be parliamentary and presidential elections towards the end of 2013. President Mugabe and his Zanu-PF will claim to have won a famous victory in forcing the EU into a U-turn.

But this is unlikely to resonate with the electorate, especially since, as the sanctions go, so the economy will get worse, with gross domestic product growth slowing to around 5% or even less in 2012 and quite possibly — depending on global economic developments — slipping further next year. That said, Mugabe is more likely to benefit than lose from the EU’s action.

But, provided the 2013 election is reasonably free and fair, he and his party will still lose.

.Hawkins is a renowned Zimbabwean economist and a board member of the Reserve Bank of Zimbabwe

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