The crisis intensifies!

The situation in Zimbabwe has deteriorated sharply in the past few days. The government has imposed a ban on public meetings, the strikes are continuing with the State run hospitals now completely paralysed, Doctors and Nurses refuse to go back to work. The Universities are due to open on Monday but staff is on strike and there are no signs of compromise. Students plan to join the strike on Monday in support of their lecturers and demanding attention to the stark conditions under which they are living. The ZCTU has announced a national strike in a month's time and the State Security Minister has threatened them with dire action.

Now a form of curfew is being imposed on the high-density townships across the country in an effort to bring the situation under control. These are clearly signs of panic in the realms of government.

Tomorrow should be the start of a 4-month freeze on prices and wages - however I understand the proposal has been abandoned as being simply unworkable. No statements are forthcoming from the authorities and to say the least, there is considerable confusion in business and Union circles. The Governor of the Reserve Bank speaks of a 'Social Contract' but none exists.

However the most serious indicator of collapse is in the open market price of foreign exchange. Driven by the frantic efforts of people to buy foreign exchange in any form for a variety of needs from education fees to water chemicals for the Cities and those who want to externalize or even protect their assets. No one wants to hold local money - and the options are the stock market, foreign exchange and assets such as property or simply business stocks.

Today was no exception - the USD went to 7 500 to 1, the pound to 14 200 to 1 and the Rand was at 1100 or 1200 to 1. These are dramatic devaluations in a matter of a few days and importers simply do not know what to sell their imported products for when it comes to replacing their stock. Fuel distributors closed their outlets today while the adjusted to the new situation. We bought fuel at Z$6 600 and watched as the company ratcheted up its price to Z$7 500 while we were present. That seems to be the price at the moment. Bakeries are all over the place - most are charging double the 'controlled' price.

This means a new surge in inflation and it is now clearer than ever that the government has lost all semblance of control in the economy. Gold sales are declining even more rapidly as mines close down in the face of unrealistic prices and exchange rates. Food is now being imported to meet all our basic food needs - local stocks are exhausted.

I watched a special programme last night on SABC about the plight of the border jumpers. Anyone watching that could not help but be moved by the plight of the people affected by this crisis in Zimbabwe. To see them risk crocodiles, armed gangs, the SA Police and Army and thirst and exposure to get away from Zimbabwe and try to make a living, any sort of a living, in South Africa was heart wrenching. To hear a white farmer describe finding a dead women next to a game fence with a baby that had lived for 3 or 4 days after the mother had died of exposure, just made me mad with anger at those who created and continue to tolerate the actions that have brought this about.

If someone with power does not do something to get this situation back under control, they better prepare for a real flood of refugees into South Africa - because the situation in Zimbabwe is simply no longer tenable.

Eddie Cross
Bulawayo, 28th February 2007