It’s the rule of law stupid!

Taking Stock Kudzanai Sharara
The most monotonous phrase in economics commentary is: “It’s the economy stupid.”
Trotted out by every columnist at one time or another, what it simply means is that ultimately, what makes things work in a country, politically or socially is the economy.

The phrase was used by Bill Clinton as part of his campaign strategy to remind voters of the weak George Bush economy.

But for Zimbabwe, the problem has never been lack of knowledge, skills or experience to formulate or address economic issues.

The problems have been bad governance, nepotism in making key appointments, corruption and abuse of resources, as well as failure to enforce laws that we would have spent time to formulate.

I can think of plenty of things — poverty, unemployment, poor health service delivery, dilapidated infrastructure, traffic congestions, cash crisis and many more — and can link all of them to our failure to formulate, adhere, or enforce the rule of law.

One can easily link all that to failure to formulate, adhere, or enforce basic rules and regulations that must apply in everything we do both at Government and at private sector level.

The country is indeed facing economic challenges, but I don’t think focusing on economic issues and how they can be turned around will help us achieve President Mnangagwa’s vision for the country to become a middle income economy by 2030, with a per capita income of $3 500.

For me the phrase that we should be using as strategy for an economic turnaround is “It’s the rule of law, stupid.”

If we were following and enforcing the rule of law to the letter, we wouldn’t be facing most of the challenges we are facing as an economy.

For evidence, look at each and every challenge we face today and see if it cannot be solved by enforcing the laws or the rules and regulations that we have in our statutes.
Take the currency challenges we are currently facing, we wouldn’t be facing such challenges if everyone was adhering to the letter and spirit of the law.

Zimbabwe must be one of the very few countries where unlawful trading in cash is done in broad daylight.

We also have businesses that are operating in broad daylight but do not have bank accounts and do not deposit their daily sales savings as required by the law through the Bank Use Promotion Act.

With such laws, why do we still have traders, who do not keep accounts with financial institutions, traders who do not bank surplus cash in an account within a certain time as stipulated by the law?

The country witnessed the collapse of most parastatals with 70 percent of the 93 state owned enterprises ‘technically insolvent,’ or ‘illiquid.’ The most serious common weakness that led to such deplorable state is weak corporate governance, and failure to observe set rules and regulations which under normal circumstances must lead to certain prescribed consequences.

Unfortunately, in Zimbabwe, those who abused their privileged positions, were exempt from any form of punishment. Thousands of people lost their jobs because of mismanagement and looting at SOEs and this has resulted in them lining up the streets to sale trinkets. But those who cause such calamity are left to enjoy their ill-gotten gains.

The country is currently struggling with a cholera outbreak, in addition to perennial challenges of illegal street vendors, and transport operators operating from undesignated points, among other illegal activities and yet there are city by-laws which must be adhered to.

We might argue that people are engaged in these illegal activities because that’s the only way they can earn a living, but they are probably in this position (unemployed) because some, abused their positions of authority which led to job losses.

The country did not benefit much from its resources, diamonds in particular, and if we were to investigate wholeheartedly how we lost billions of dollars, it won’t be a surprise to see that all we needed to do to get the full benefit of the resource, was to formulate and enforce laws.

The country ended up having a controversial land reform program, because the Government of the day, reneged on its duties, to redistribute land, and allowed people to invade farms destroying property and lives in the process, and yet, if it had used its mandate to govern, it could have come up with laws to take back the land, as they are trying to do in South Africa.

There is need to return to simple basic rules.
If we are to focus on a “Rule of Law” approach to economic development and address issues around corruption, manipulative and speculative pricing and ease of transacting, then half the problems we are facing will be solved.