5 August 2005 - Proposed South African Bailout for Zimbabwe

In May 2005, after months of work to win agreement from Robert Mugabe's usual international backers that they would not intervene, SA president Thabo Mbeki offered Zimbabwe a financial bailout - with conditions.  It seemed Mugabe would have no choice but to agree.  However, he once again outwitted his South African interlocutor, and ordered his finance chief, Gideon Gono to raid the foreign exchange accounts of Zimbabwean businesses in order to get the US$50-million he needed to pay the International Monetary Fund to avoid expulsion from the fund when it next met to review Zimbabwe’s status.  My 8 May 2005 report on the proposed bailout:

DATE=05/08/2005

TYPE=BACKGROUND REPORT

TITLE= SAF ZIMBABWE

NUMBER=5-

BYLINE= DELIA ROBERTSON

DATELINE=JOHANNESBURG

CONTENT=

VOICED AT:

HEADLINE: 

INTRO:  At a meeting in Pretoria, South African Finance Minister Trevor Manuel has informed Zimbabwe’s Finance Minister Herbert Murerwa of South Africa’s conditions for paying a portion of Zimbabwe’s debt to the International Monetary Fund to prevent that country’s expulsion from the IMF.  Also present at the meeting were the two countries’ central bank governors.  From our Southern Africa bureau in Johannesburg, VOA’s Delia Robertson takes a closer look at the political and economic implications of the bailout.

TEXT:  For more than a month, Zimbabwe President Robert Mugabe has been trying to source a loan of some US$1-billion to make minimum payments on Zimbabwe’s debt, to fund food and agricultural products, and to pay for fuel.

Last month South Africa said it would consider providing a line of credit to Zimbabwe, but attached several economic and political conditions to the offer.  Mr Mugabe balked at the terms and instead went to China hoping for an unconditional loan – only to find that his warm welcome in Beijing did not include the assistance he was seeking. 

At a minimum Zimbabwe needs to pay the International Monetary Fund US$50-million in order to avoid expulsion from the fund when it next meets to review Zimbabwe’s status.  Zimbabwe is currently US$295-million in arrears with the IMF and this, together with its other international debts, could accrue to a US$1-billion balance of payments deficit by the first quarter of 2006.

This week Mr Mugabe’s emmissaries were back in South Africa, where they were offered about 10-percent of the US$1-billion they want.  In addition  they will have to commit to urgently engage in negotiations with the opposition Movement for Democratic Change, constitutional reforms, restoration of the rule of law, and the repeal of repressive laws such as those which inhibit a free media.

In addition to the political conditions, Finance Minister Manuel will want to see Zimbabwe implement an economic recovery plan that can be sustained over the long term.  The money will be paid in tranches, based on Zimbabwe meeting defined commitments.  And, it will not be handed to the government to spend as it pleases.  Instead it will be paid to international lenders, and directly to suppliers of energy, fuel, food and other essential goods.

South African officials have not publically confirmed these conditions – instead only saying any assistance must go to "economic recovery" and "political normalization" and that South Africa’s dealing with other countries are not based on conditions.  Privately however, government officials are expressing relief that South Africa now has some leverage to influence developments in Zimbabwe. It’s a leverage, says political analyst John Stremlau, that Mr. Mbeki has not had in the past in his dealings with Mr. Mugabe.

///STREMLAU ACT.///

As I’ve said so often in the past, if you think hard about what South Africa’s leverage over Zimbabwe is short of pulling the the kind of intervention that say the U.S. did in Iraq, there doesn’t seem to be a number of levers that were pullable.

///END ACT.///

But Mr Mugabe has in recent weeks frequently said that he would not accept any assistance that comes with conditions.  And, in fact, has refused to ask the World Food Program for food assistance even though as many as four million Zimbabweans are expected to require food aid by early next year. 

Before he visited Zimbabwe in May, the WFP’s James Morris made it clear that the only condition he would attach to such assistance, would be that the United Nations and its partners in the humanitarian sector in Zimbabwe would distribute the food.

Mr Stremlau of the the University of the Witwatersrand in Johannesburg, says Mr Mugabe is likely to continue to resist South Africa’s prodding toward change for as long as he can.

///2^ND STEMLAU ACT.///

30:  I don’t think any of us can predict whehter or not Mugabe is prepared to compromise his policies which have raised such international concern.  South Africa’s central interest has been to promote a government of national unity which would allow Mugabe to step aside and for a new breed and a will of leadership to emerge and I think that’s probably what is behind this bargaining around the loan.

///END ACT.///

Zimbabwean economist Tony Hawkins says that even if South Africa were to loan Zimbabwe the full amount it wants, the benefits would not last long.

///HAWKINS ACT.///

I don’t think it would have anything like as major effect as some are suggesting.  In the current year, it looks as though zimbabwe is going to run a balance of payments deficit in the region of US$700-million to US$1-billion – so it could well be that if this loan were to materialize, it would be pretty much used up by the first quarter of next year.

///END ACT.///

In the past six years Zimbabwe’s economy has contracted by 40-percent, and the formal sector has shed 450-thousand jobs – down one third from 1.4-million.  Professor Hawkins of the Univeristy of Zimbabwe says the effects have been far-reaching.

///2^ND HAWKINS ACT.///

People are obviously an awful lot poorer than they were.  Incomes are on average about 40 percent lower; we have seen a big outflow of skills, black skills, white skills – a lot of the younger people have moved on.  We have seen shrinkage in terms of companies, a number of foreign companies have just sold out and moved off – or relocated some of their operations, mostly to South Africa.  We have seen virtually no investment since 2000, we have seen a very serious deterioration in underlying infrastructure – anything from urban lighting, and sewerage and housing, right through to telephones, railways, aircraft, electricity provision.

///END ACT.///

The World Bank estimates that until the government’s recent forced removals campaign, the informal sector comprised 60-percent of Zimbabwe’s economy.  Mr Hawkins says the losses to the informal sector have affected suppliers in the formal economy, but he says the real effect has been to those people who made what was already a meagre income by selling from the streets or other micro-businesses.

///3^rd HAWKINS ACT.///

And if you follow that one down it’s a knock on effect in the formal sector, but in the informal sector level, you have people who a few months were earning 5-6 hundred thousand Zimbabwe dollars a day from selling vegetables to people on street corners.  And we are now told that they are perhaps earning 1- or 2-hundred thousand dollars a day, by doing the same thing very clandestinely.

///END ACT.///

Professor Hawkins says that even if Zimbabwe does accept and implement the conditions set by South Africa and uses the money over the coming year to recover from its current crises, longterm recovery in the Zimbabwe economy will be very slow.

He says it will take at least eighteen months for Zimbabwe to re-establish a record of compliance with international lenders and start receiving assistance again.  And says Professor Hawkins, it will take at least a decade for the economy to start growing again.  (Signed)

NEB/DAR/ 

Reporter's Notebook Walter Sisulu 16 May 2003

Remembering Walter Sisulu

Listen to 'Remembering Walter Sisulu'

Remembering  Anti-Apartheid Activist Walter Sisulu - 2003-05-16

This weekend [17 May 2003], South Africans bury veteran anti-apartheid activist Walter Sisulu, who died last week, just 12 days before his 91st birthday. VOA's Delia Robertson knew Mr. Sisulu, and sent us these personal memories.

I watched silently as the tall white man reached out his hand and, his voice choked with emotion, thanked the short black man for all he had sacrificed for his country. The short man pulled the tall man towards him and wrapped his arms around him in a sustained and vigorous hug.

The short black man was Walter Sisulu and the tall white man, my father, Duncan Robertson. It was a year since Walter Sisulu's release from jail in October 1989, and since I had first met him and also received one of his famous introductory hugs. In that year, like many other South Africans, I had learned to love him as a second father, and felt privileged to call him Ntate, or father, Sisulu.

And so I was thrilled when my parents asked to meet Ntate and his wife, Albertina, or Ma Sisulu, whom I had known for several years before her husband's release. During that memorable visit in their small Soweto home, the Sisulus told my parents they would just have to get used to sharing me, because, they said, she is now our daughter, too.

I was not the first, nor would I be the last, to be so honored. The Sisulus were renowned for drawing people into the ever-expanding embrace of their love. Amina Cachalia, a veteran anti-apartheid activist who knew Walter Sisulu for 50 years, told me he was the kind of person who drew people to him. "Walter was just such a teddy bear type of personality," she said. "Somebody that you just wanted to hug all the time. Even when I met him first he gave me that impression. But he was a wonderful, soft, gentle man to sit and talk to about anything. And you felt he was like yourself, an ordinary guy that you could talk to, and yet, he had quite a mind and quite a vision that he always tried to instill in others and talk to others quietly about. He was an unassuming sort of a chap, and yet, he had this quality of getting over [conveying] what he believed in and what he wanted others to believe in."

I once asked Ntate Sisulu how, given his treatment at the hands of the white apartheid government, he was able to show such warmth to white people, whom he had never previously met, why he seemed so free of any bitterness. "We were not fighting the white man to go to the sea," he said. "No, we were fighting for the system. We must participate, we must have a share in the affairs of this nation. And to be bitter, therefore, would be to defeat my basis, my very development, and, therefore, I must avoid becoming anti-white."

His friend, Amina Cachalia told me, the foundation of both the private and the political Walter Sisulu was his absolute belief that all people are equal. "Complete non-racialism and a coming together of all people, all the time, to carry on the democracy that he helped [bring] about," she said. "I think his legacy is enormous, and if we can carry on and imbibe that legacy, we will be better people in South Africa."

In June 1964, along with his dearest friend, Nelson Mandela, and five others, Walter Sisulu was given a life sentence for sabotage. He was the first defendant in what is now famously known as the Rivonia treason trial, which lasted a year from their arrest at Liliesleaf farm in Rivonia on the northern outskirts of Johannesburg.

Walter Sisulu's long road to jail began in the eastern Cape Province of South Africa, where he was born on May 18, 1912. His mother was Alice Sisulu, a black domestic worker, and his father a white magistrate, Victor Dickenson. The relationship between his parents lasted several years, and although his father helped the family financially for a few years, he never acknowledged either Walter, nor his younger sister, Rosabella. Their maternal uncle, the village headman, acted as their father.

The uncle's death when Walter was 15-years-old and in grade six forced him to leave school and head for Johannesburg, where he got work in a dairy. Several different jobs followed. He was a domestic worker, a factory worker and, for a time, he worked in a bakery, from which he was fired for organizing a strike for higher wages. Continued clashes with a range of employers over union activities ultimately led to him becoming a self-employed estate agent.

His union activities brought Walter into contact with the African National Congress, which he joined in 1940. Nine years later, he was elected secretary general. It was during this period that he met Nelson Mandela, became his political mentor and recruited him into the ANC. Walter told me that he immediately recognized the potential in Mr. Mandela, and, as he did with so many other political leaders of the period, he pushed South Africa's future president toward leadership roles. "Well, first of all, he meets me," said Walter Sisulu. "He was a much younger man. He meets me already in the movement, and in that way, I am influencing the direction, and we discuss naturally with him. Then, I was dealing with a man who was bright himself - he had ideas."

But the Afrikaner-dominated Nationalist Party had come to power in 1948, and introduced statutory racism in the form of apartheid. In the ensuing years, Walter Sisulu was in the forefront of peaceful protests such as the Defiance Campaign of 1952. For these and other acts Mr. Sisulu and other senior ANC leaders were charged in December 1956 with treason. They were acquitted nearly five years later.

Three months after that, Mr. Sisulu and other ANC leaders decided to escalate the fight against apartheid to an armed struggle, and established the armed wing of the ANC, Umkhonto we Sizwe, or Spear of the Nation. It was not long before he and his colleagues were operating underground, and, in July 1963, he was arrested in Rivonia, and for the second time, tried for treason.

It is not possible to speak of Walter Sisulu, without also mentioning his wife Albertina, or Ma Sisulu. They were South Africa's most loved couple. But Ma Sisulu was an activist in her own right, and, as Amina Cachalia reminded me, kept their family together, even though she, too, suffered severely at the hands of apartheid's enforcers. "But of course, Albertina had the brunt of the separation, and she really missed him all the years," said Amina Cachalia. "And hers was such a tremendous responsibility, to keep that family together, [she was] sometimes in jail, and sometimes away, and sometimes being tortured, and he in prison. So, it was tremendous loss for her, and I think, if anybody deserved a better deal, it would be Albertina."

Walter told me that no other woman came close to Albertina. "When I took up the position of being a secretary general, that very night I knew, finished with me," he said. "I can't go to business, I can't be employed, I've got a duty to the people. Changed my whole approach. What was I going to depend on? I was not paid a salary, I wasn't going to earn anything. I depended on my wife. I say remarkable, because, with no means, she was able to keep the family together."

Walter Sisulu was former President Mandela's dearest friend and the man Mr. Mandela constantly reached out to for support and advice. Using Mr. Sisulu's clan name, the former president said Walter was a man of rare humanity. "Xhamela has never been president of the ANC," he said. "He had never been a member of parliament. He has never been honored as some of us were honored. Nevertheless, he stood a head and shoulders above all of us. What was the reason for this? Because he had the gift of humility."

Ntate Sisulu's humanity has continued to touch new people in the aftermath of his death, with television shows and radio talk shows dominated by discussion of his life. Amina Cachalia told me that many white South Africans have approached her to say they now have new insights into the anti-apartheid struggle. "But the people that talked to me the other day said it had opened up a new understanding for them, the man's death, and what he had stood for, and what he had done, and the legacy he has left for the people and, these were all white people - that they've understood things better," she said. "And I said, well, if Walter could have done that in death as much as he did it to us in the earlier days, then his legacy is tremendously important."

Walter Sisulu's legacy, his sacrifices and his work for democracy in South Africa are well documented, and will become a part of history. But his friend and fellow activist Amina Cachalia says his death reminds us that the generation that offered forgiveness to end oppression is passing from our midst. Hamba kahle Ntate Sisulu - farewell Walter.