The
publication
of a
US
congressional
bill to
guide
foreign
policy
on
September
11th
has
offered
hope
to
Zimbabweans
that
the
draconian
ZDERA
(the
Zimbabwe
Democracy
and
Economic
Recovery
Act,
2001)
legislation
may
be
repealed.
This
could
see
the
end
of
one
of
the
last
formal
sanctions
on
Zimbabwe,
offering
hope
of
a
greater
rapprochement
with
Western
powers.
Can
this
lead
the
way
to
debt
and
arrears
clearance
and
new
flows
of
much-needed
international
financing?
Over
the
last
few
years,
the
formal
sanctions
by
the
US,
EU
and
UK
on
individuals
and
companies
have
been withdrawn
or
reduced,
although
a
few
individuals
remain
under
global
financial
sanctions
due
to
accusations
of
corruption.
There
was
a
growing
sense
among
the
diplomatic
community
that
such
sanctions
had
little
effect
on
the
Zimbabwean
regime.
Indeed,
they
were
used
to
galvanise
support
for
the
ruling
party
who
were
able
to
rail
against
the
‘imperial
powers’
at
election
time.
Even
though
formal
sanctions
were
limited,
the
chilling
effect
of
poor
diplomatic
relations
on
international
investment
and
finance
flows,
both
private
and
through
the
international
banks,
has
had
a
devastating
impact
on
the
Zimbabwean
economy
over
a
quarter
of
a
century.
In a
recent
interview
economist
Prof
Gift
Mugano,
highlighted
the
impacts
of
sanctions,
with
investment
flows
dropping
from
25%
of
GDP
to
1%
after
2001,
and
risk
premiums
increasing
dramatically,
putting
off
many.
The
so-called
‘look
east’ policies
have
compensated
to
some
degree,
but
China
was
never
going
to
provide
the
sort
of
finance
that
could
be
sought
elsewhere,
and
most
support
was
closely
tied
to
minerals
and
infrastructure
investment
deals.
ZDERA
was
signed
into
law
in
2001
as
a
direct
result
of
the
land
reform.
It
was
different
to
other
sanctions,
as
it
could
only
be
reversed
through
changes
in
the
law,
hence
the
need
for
this
bill.
In
2021, the
US
Embassy
in
Zimbabwe
celebrated
ZDERA’s
10th anniversary,
restating
the
array
of
measures.
Most
notable
was
the
requirement
that
the
US
was
obliged
by
law
to
avoid
engaging
with
the
International
Finance
Institutions
on
financing,
debt
and
arrears
restructuring
and
so
on.
A
whole
host
of
conditions
were
attached,
mostly
focused
on
governance
reforms.
That
ZDERA
was
peculiar
and
not
applied
to
other
countries
with
perhaps
even
more
dubious
track
records
has
often
been
pointed
out.
But
that’s
not
the
point,
the
lobby
groups
within
the
US
who
vociferously
backed
the
opposition
against
ZANU-PF
and
rejected
the
land
reform
were
very
powerful,
both
within
and
outside
Congress.
Changing
political
winds
So
why
the
changes
now?
There
is
a
growing
consensus
that
the
sanctions
have
had
no
effect
on
the
government
and
imposed
hardship
on
the
people,
squeezing
the
economy.
In
the
absence
of
an
organised
opposition,
prospects
for
change
are
most
likely
to
come
through
reengagement,
with
some
faction
or
other
of
the
ruling
party
potentially
pushing
for
change.
And
such
reengagement
may
be
most
likely
when
there
are
resources
flowing
with
prospects
of
improvements
in
living
standards.
Conditionality
will
not
disappear
of
course,
and
financial
sanctions
will
remain
on
individuals
governed
by
laws
on
corruption
internationally,
but
at
least
dialogue
can
be
re-established.
The
other
thing
that
has
changed
in
diplomatic
missions,
including
the
UK,
US
and
EU,
is
a
shift
away
from
‘aid’
towards
‘commerce’.
The
new
congressional
bill
is
sponsored
by Brian
Mast,
a
Florida
Republican
and
chair
of
the
House
Foreign
Affairs
Committee.
It
is
a
wide-ranging
bill aiming
to
recast
the
US’s
relationships
globally,
focusing
in
particular
on
‘American
interests’,
and
avoiding
what
he
terms
left-wing
interference
with
diplomatic
positions.
It
has
a
section
on
‘commercial
diplomacy’
and
the
need
to
establish
business
and
trade
ties
with
Africa,
and
mention
of
Zimbabwe
and
ZDERA
is
hidden
away on
page
54,
part
of
a
wider
effort
to
regear
US
international
engagement
under
President
Trump.
Meanwhile
the European
Union’s
Global
Gateway strategy
aims
to
secure
partnerships
in
a
range
of
sectors,
including
energy,
through
supporting
European
business
engagement
in
Africa
and
elsewhere.
Similarly,
the
UK
government
is
developing a
new
‘critical
minerals
strategy’ and
the
Foreign
Commonwealth
and
Development
Office
(FCDO)
is
facilitating
commercial
deals
in
line
with
national
geopolitical
interests.
The
race
for
critical
minerals
is
on,
and
the
West
are
many
years
behind
the
Chinese,
especially
in
Zimbabwe.
The
calculation
is
clearly
that
Western
countries
need
to
catch
up,
and
to
do
so
will
require
leveraging
resources.
This
is
not
the
soft
diplomacy
of
aid
programmes
and
nice
projects
involving
NGOs,
and
support
for
health,
education
and
agriculture
programmes.
This
is
the
hard-nosed
commercial
reality,
with
access
to
critical
mineral
resources
being
top
of
the
agenda.
No
different
to
China
of
course,
but
different
to
the
past
‘aid’
era
for
sure.
Strings
attached:
a
link
to
the
compensation
of
white
farmers
Further
US
funding
following
the
removal
of
ZDERA
is
of
course
not
without
strings
attached,
as
discussed
in a
recent
‘Friday
drinks’
TV
show.
The
sanctions
regimes
by
the
West
were
established
following
the
land
reform
in
2000
in
reaction
to
the
expropriation
of
land
from
white
farmers.
Thus,
in section
303b,
the
bill
states
that
only
if
the
full
compensation
to
white
farmers
–
as
agreed
in the
Global
Compensation
Deed
signed
in
July
2020 –
is
committed
to
within
12
months
will
US
support
for
a
deal
with
the
International
Financial
Institutions
continue.
According
to
the
bill,
such
future
compensation
payments
in
turn
must
be
in
in
US
dollars
and
not
treasury
bonds,
no
doubt
the
result
of
some
successful
lobbying
in
Washington
DC
by
a
faction
of
the
white
commercial
farmers
unhappy
with
the
agreed
terms
of
payment.
Given
that
the
agreed
total
amount
is
US$3.5
billion,
this
is
a
big
deal.
The
Zimbabwean
government
doesn’t
have
this
sort
of
money
of
course,
and
paying
commercial
farmers
at
this
level
in
cash
within
12
months
cannot
be
a
priority.
However,
the
government
remains
committed
to
compensation
payments.
US$3.1million
has
been
paid
in
cash
this
year,
with the
first
378
farmers
of
the
740
who
had
their
claims
approved
being
paid
in
April.
Around
1300
farmers
accepted
a
deal
of
a
1%
advance
cash
payment
and
then
the
remained
of
the
agreed
compensation
amounts
for
farm
improvements
to
be
paid
over
10
years
in
US
denominated
Treasury
bonds.
In
addition, 94
BIPPA
(Bilateral
Investment
Promotion
and
Protection
Agreement)
farm
compensation
deals
have
been
approved,
with
US$20
million
being
paid
out
of
a
total
of
US$146
million.
This
is
major
progress,
even
if
some
former
farmers
are
holding
out
for
a
better
deal.
Many
hoped
that
this
would
lead
to
a
thawing
of
relations
with
the
international
community
and
a
route
to
finalising
a
deal
on
debt
and
arrears.
If
ZDERA
is
repealed,
there
may
be
more
pressure
to
come
to
an
agreement
with
the
debtors.
However,
a
new
debt
and
arrears
restructuring
approach
must
define
how
the
$3.5
billion
can
be
paid
over
time,
and
the
new
bill’s
conditions
will
have
to
be
changed
in
line
with
this,
with
the
12-month
deadline
for
full
cash
payment
clearly
completely
unrealistic.
Bargaining
over
conditions
and
timeframes
Many
argue
that,
given
the
dire
economic
conditions
in
Zimbabwe,
spending
$3.5
billion
on
dispossessed
white
farmers
even
under
a
debt
and
arrears
restructuring
deal
is
a
step
too
far.
Many
former
farmers
have
left
the
country,
and
others
have
regeared
their
businesses
in
agriculture
to
make
money
upstream
from
production
on
the
land,
and
few
can
be
counted
in
the
ranks
of
the
poor.
This
is
an
extreme
case
of
‘reverse
reparations’,
some
say,
despite
the
constitutional
requirement
for compensation
for
improvements
to
land and
the
need
for
political
expediency
and
rapprochement
with
the
West.
Let’s
hope
that
the
bill
is
passed
and,
after
nearly
25
years
of
sanctions,
Zimbabwe
is
once
again
allowed
to
engage
with
the
US
and
international
financial
institutions.
I
am
sure
that
there
will
be
bargaining
over
the
conditions
and
timing
and
form
of
compensation
payments.
And
the
Zimbabwean
government
will
equally
have
to
be
serious
in
its
commitments
to
reforms
as
part
of
any
bargain.
There
are
many
urgent
priorities
that
renewed
international
finance
can
provide
funding
for.
The
challenge
of
rebuilding
the
core
infrastructure
of
Zimbabwe
is
huge,
not
least
the
sort
of
investments
that
must
be
part
of
a
sustained
agrarian
reform.
It
has
been
a
long
time
to
wait
and
so
many
opportunities
to
benefit
from
the
land
reform
have
been
missed
through
lack
of
post-redistribution
investment.
This
post
was
written
by Ian
Scoones and
first
appeared
on Zimbabweland.
Post
published
in:
Agriculture