Zimbabwe Haemorrhaged by Corruption and Sanctions, Losing $100 Billion Since Independence
Corruption has taken a devastating toll on Zimbabwe’s economy since independence in 1980, resulting in a staggering loss of $100 billion, according to Transparency International figures. This amount is more than double the country’s national debt, highlighting the severe impact of corruption on the economy.
The Impact of Corruption
- Corruption has cost Zimbabwe $100 billion since independence
- Double the country’s national debt
- Devastating impact on the economy
The United States still operates the Zimbabwe Democracy and Economic Recovery Act (ZIDERA), passed by Congress in 2001, which prevents Zimbabwe from accessing loans and investment from international financial institutions such as the IMF and World Bank. Experts say that this has led to:
The Consequences of ZIDERA
- Banks lose about $1 billion annually in higher bank charges
- Zimbabwe could have easily settled its national debt with this amount
- Correspondent banks refuse to deal directly with Zimbabwean banks, adding extra costs
Sanctions: Do They Work?
Sanctions imposed by the US, UK, and EU have had a devastating impact on Zimbabwe’s economy. However, Transparency International’s Zimbabwe chapter director, Cross, argues that sanctions do not tackle corruption:
- Allow China free access to international financial markets
- Enable China to borrow enormous sums of money at low interest rates for infrastructure development
A 2022 Institute of Security Studies Africa (ISS) report concluded that sanctions have largely failed to improve democratic behavior among Zimbabwe’s ruling elites. Human rights violations persist, and political freedoms remain severely curtailed.
The Government’s Response
- Former President Robert Mugabe called sanctions “interference in the affairs of Zimbabwe,” a sovereign state
- Current President Emmerson Mnangagwa has adopted a more conciliatory approach, pursuing re-engagement with estranged countries
- However, US policy remains unchanged: Zimbabwe must address the issues for which sanctions were imposed
The Complicated Relationship between Zimbabwe and the US
The complicated relationship took another hit in February when the US protested against the deportation of USAID officials and contractors. Zimbabwe’s version is that the individuals entered the country without notifying authorities and held “unsanctioned covert meetings.”
The Way Forward
Transparency International urges Zimbabwe’s leaders to address corruption, improve transparency, and accountability in government:
- Removal of all sanctions will expose government incompetence
- Corruption must be tackled for the economy to recover
As the debate over sanctions continues, it is clear that both corruption and sanctions have had a devastating impact on Zimbabwe’s economy. It is imperative for the country’s leaders to take concrete steps to address corruption and improve transparency and accountability in government.