Global Risks Forecast

Despite "disengaging" from the government of national unity with President Robert Mugabe's Zanu-PF, Prime Minister Morgan Tsvangirai's MDC has little alternative but to seek accommodation with its coalition partners

Event

Prime Minister Morgan Tsvangirai and the Movement for Democratic Change (MDC) suspended ties with governing partners Zanu-PF on 17 October 2009, just eight months after the formation of the government of national unity (GNU). The move was prompted by the re-arrest of Tsvangirai’s aide Roy Bennett on 14 October on terrorism charges, though tensions over foreign aid and a new constitution have been apparent for months. MDC is boycotting cabinet meetings chaired by Zanu-PF’s President Robert Mugabe, preventing decision-making by the GNU. Tsvangirai has appealed to South Africa, Mozambique, DR Congo and Angola as members of the Southern African Development Community (SADC) to mediate the dispute.

Significance

Tsvangirai is holding separate cabinet meetings until, he says, Zanu-PF have implemented their obligations under the Global Political Agreement (GPA) that underpins the GNU. This agreement was brokered by SADC, hence Tsvangirai's appeal to the regional body. A SADC meeting will be held in Harare later this week. President Mugabe is reported by state media to be unperturbed, saying that Zanu-PF has met its obligations and expects MDC to return to the GNU soon.

MDC meanwhile have been forced to defend their “disengagement” from Zanu-PF, which Tsvangirai branded as “dishonest and unreliable”. It is not clear how formal government business will be affected as the GNU lacks a quorum for decision making. MDC members do not appear unified on the matter, however. Ministers from the Deputy Prime Minister Arthur Mutambara’s branch of MDC did attend the weekly cabinet meeting. In the meantime, other ministerial work continues.

Opinion in Harare appears to be divided; some assert that Tsvangirai had to act against Zanu-PF intransigence in meeting the requirements of the GPA. The impasse between MDC and Zanu-PF includes overcoming disputes on key posts including the central bank governor, the failure of Mugabe to swear in transitional governors and dispatch MDC ambassadors (even though names have been agreed) and the unilateral appointment of the attorney general (see our related article).

Detractors within and outside of MDC believe Tsvangirai has overplayed his hand for too small a matter. Yet MDC officials and supporters continue to be harassed by state law enforcement; Bennett, MDC’s deputy agriculture minister, was first arrested in February 2009 just hours before the GNU was inaugurated. Bennett, a former white farmer, returned from a three-year exile in South Africa in January 2009 to take up his post, which is likely to encounter controversial land reform issues. Having been released again on 18 October Bennett’s trial was postponed to November 2009. On 24 October Finance Minister Biti’s house was raided on suspicion of harbouring weapons belonging to the military, a charge which he denies. In addition, on 25 October, the chief executive and the chairperson of the National Association of Non-Governmental Organisations were arrested in Victoria Falls for holding a public political meeting without approval. The association denies the charge. However, the arrests follow claims the previous week by State Security Minister Sydney Sekeramayi that Western nations were funding NGOs, media and political groups to build up opposition to Mugabe.

Will Mugabe take action?

MDC’s absence could test whether Mugabe decides to take unilateral policy decisions. MDC is likely gambling on the need for Zanu-PF to retain the GNU to ensure international actors such as the IMF do not pull back from its commitments. On 15 October 2009, the UK government said it would be providing US$100m to Zimbabwe during 2009 to support the GNU. In September 2009, the IMF released US$400m of US$510m Special Drawing Rights (SDR), though Finance Minister Tendai Biti was reluctant to further indebt Zimbabwe. Recently, Biti said that he believed Zimbabwe should declare itself a heavily indebted country in order to write off its debt and allow rebuilding of the country’s infrastructure to begin.

However, local media are reporting that the Reserve Bank of Zimbabwe (RBZ) has the right to disburse those funds rather than the Finance Ministry. The report also suggests that the funds would not be debt-serviced, with only an annual fee of 0.26% to be paid. This was because the IMF was providing the funds as part of assistance to economies affected by the global economic crisis. Bank governor and Zanu-PF supporter Gideon Gono and Biti have disagreed over how to manage the funds. The bank is in favour of immediate disbursement to inject liquidity into the economy. It wishes to allocate funds to mining, manufacturing and tourism sectors, as well as recapitalising the bank and for public utilities. Biti wants the funds disbursed through the 2010 budget, which will be presented in November. IMF officials conducted an October 2009 visit to the country, but have yet to comment on the government developments.

Unilateral policy action by Mugabe would be unpopular with donors on the one hand, but MDC arguably lacks the relative power to counter Zanu-PF. A 26 October meeting between the prime minister and president failed to make progress on reconciliation. The Herald newspaper quoted Mugabe as saying that MDC had unreasonable expectations if it thought that Zanu-PF would voluntarily cede aspects of its authority to MDC.

Forecast

A full pull-out by any member of the GNU should prompt an election within 90 days, according to the GPA. However, MDC insist they remain in power. It is not in their interest to pull out of government at this stage. Zanu-PF have control of too many aspects of power in the political and security spheres, including the Joint Operation Command of the police, military and intelligence officers. SADC are viewed as powerless to break the deadlock, including by the Zanu-PF camp.

Nor do many citizens wish MDC to leave the government. The uncertainty of the disengagement reportedly prompted an increase in local food prices. MDC are likely to return to the unity government due to the need to keep it functioning in order to maintain external financial and political support.

Related Maplecroft Risk Indices - Zimbabwe

Please click below to find out more about Maplecroft's Risk Indices and related maps, which quantify intrinsic country risk across a range of non-financial issues.

Civil and Political Rights

Extreme risk

Low risk

Index: 1.1

0

10

Regime Stability

Extreme risk

Low risk

Index: 2.3

0

10