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Sanctions on Zim affecting region

Sanctions on Zim affecting region

The implosion of the Zimbabwean economy due to the United States and European Union-backed sanctions has added a burden to the social services of neighbouring countries due to mass emigration, SADC Executive Secretary Dr Stergomena Lawrence Tax, has said.

She said the lack of financial support for infrastructure development had led to the delapidation of critical rail and road networks in Zimbabwe, which were traditionally utilised by neighbouring countries as transit networks in support of regional trade.

SADC is united in its call to lift the economic sanctions currently affecting the livelihoods of Zimbabwean citizens.

Dr Tax said that it was evident that the strategic sectors of the Zimbabwean economy were constrained by the imposition of the sanctions (targeted or not targeted) as they were a barrier to innovation, growth, profitability and investment.

She said that sustained sanctions would imply continued lack of access to multilateral financing and therefore no prospects for economic resuscitation.

Instead, Stergomena said, the economy would continue to grapple with public debt, inflation, unemployment, low FDI stock and limited supply of goods and services, with negative and devastating impacts on the lives of ordinary Zimbabweans.

She pointed out that the economic sanctions imposed on Zimbabwe were having a toll on the region.

“The implosion of the Zimbabwean economy has added a burden to the social services of neighbouring countries due to mass emigration. The lack of financial support for infrastructure development has led to the delapidation of critical rail and road networks in Zimbabwe, which were traditionally utilised by neighbouring countries as transit networks in support of regional trade,” she said.

Regardless of the terms used to define the sanctions, Tax said the international finance and investment entities take a pre-cautionary approach, and inadvertently restrict the extension of financial support to Zimbabwe, and investment across economic sectors.

This is contrary to the argument that the sanctions are targeted at individuals, and do not affect ordinary Zimbabweans and the region. This situation negatively affects the prospects for economic recovery.

“Once again, SADC reiterates its call for the immediate removal of all forms of sanctions on Zimbabwe to pave way for socio-economic transformation and economic development of Zimbabwe. The removal of sanctions will benefit Zimbabweans and the SADC region, as well as enhance cooperation of SADC with the EU and the USA,” she said.

Since 2001, International Financing Institutions (IFIs) such as the World Bank, International Monetary Fund (IMF) and the African Development Bank (AfDB) are barred from extending financial support to Zimbabwe and have suspended balance of payments and technical assistance, including declaring Zimbabwe as ineligible to access funds.

The barring came up as a result of economic sanctions imposed on Zimbabwe by the US and the EU.

In recognising the socio-economic impact of the sanctions on Zimbabwe, the 39th SADC Summit of Heads of State and Government held in Dar es Salaam, Tanzania, in August, expressed solidarity with Zimbabwe and called for the immediate lifting of the sanctions to facilitate socio-economic recovery in the country.

The 25th of October, a day which was declared a public holiday in Zimbabwe, has also been declared as a day when the SADC region collectively demands the removal of the economic sanctions on the country.

The Agricultural Bank of Zimbabwe, an entity entrusted with providing financing for smallholder farmers, was put under sanctions until February 2016. This development, coupled with the lack of external financing support, and the lack of foreign direct investment, have negatively impacted on expansion programmes and investment in agriculture, hence the deterioration in production capacity.

Two strategic entities in the mining sector, the Minerals Marketing Cooperation of Zimbabwe (MMCZ) and the Zimbabwe Mining Development Corporation (ZMDC), were sanctioned in 2008 and 2012, respectively.

In the manufacturing sector, the cancellation of business ties with US-based and US linked firms and companies has negatively impacted the industry and the sector, as the sourcing of industrial technologies and supplies was disrupted, including loss of supply and market contracts in the international markets. These developments have also affected and continue to affect the performance of the extractive sectors (agriculture and mining) and the competitiveness of the industry sector.

Sanctions on the Infrastructure Development Bank of Zimbabwe, an entity mandated to provide long and medium-term funding for key infrastructure projects in the transportation, housing, energy, ICT, and water and sanitation sectors, has resulted in the loss of credit lines worth US$100 million and equity partnerships. This has affected targeted infrastructure investments in the related sectors, especially capital intensive ones.

In the aviation industry and the tourism sectors, most European airlines have left the Zimbabwean aviation industry since 2003, affecting not only the industry, but also the tourism sector. The tourism sector is further constrained by the stringent visa requirements for Zimbabwean nationals, bad publicity and negative travel advices given to tourists as part of the calculated sanctions against Zimbabwe.

Several SADC countries, in their own capacities have also released statements calling for the removal of these sanctions.

The African Union also joined the bandwagon. Its Chairperson, Moussa Faki, reiterated his concerns that the persistence of economic sanctions imposed by the international community, continue to have negative impact on the economy and the people of Zimbabwe.

Faki expressed his determination and that of the various relevant AU organs to continue to mobilise support for the country’s recovery efforts.

“I commend the government of Zimbabwe for its efforts to create a conducive environment for economic growth and assure the government and people of Zimbabwe of the continued support of the African Union towards the country’s road to peace and prosperity for all its citizens,” he said.

Despite these calls, the EU and US have, however, come out saying that the economic sanctions were targeted at individuals and were not affecting ordinary civilians – a claim refuted by the Zimbabwean government.

By: MOGOMOTSI MAGOME Associated Press
Image credit: Free-Photos from Pixabay

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