US embassy cable - 03HARARE1971

UNCLAS SECTION 01 OF 03 HARARE 001971 
 
SIPDIS 
 
SENSITIVE 
 
DEPT. FOR AF KANSTEINER AND DUNLAP, AF/S DELISI AND RAYNOR 
NSC FOR SENIOR AFRICA DIRECTOR JFRAZER 
LONDON FOR CGURNEY 
PARIS FOR CNEARY 
NAIROBI FOR TPFLAUMER 
 
E.O. 12958: N/A 
TAGS: PGOV, ECON, EFIN, ETRD, SOCI, ZI, MDC 
SUBJECT: MDC SHADOW MINISTERS PREVIEW PARTY'S ECONOMIC 
PLATFORM 
 
 
SENSITIVE BUT UNCLASSIFIED 
 
1.  (SBU) SUMMARY: MDC shadow minister for economic affairs 
and MDC MP Tendai Biti on September 23 summarized to emboff 
the elements of the party's economic plan, called RESTART. 
The plan, which he cast as essentially a social democratic 
platform, was being circulated for comment and could be 
expected to be released publicly by the end of the year. 
Broad in scope but short on specifics, the lengthy policy 
paper is not likely to alter the political dynamic here, but 
some elements could find their way onto the agenda of 
inter-party talks.  Shadow Finance Minister Tapiwa Mashakada 
on September 24 shared with the Embassy a draft of RESTART, 
for which he sought international support.  END SUMMARY. 
 
RESTART Lays Out "Social Democratic" Agenda 
------------------------------------------- 
 
2.  (SBU) Tendai Biti elaborated to emboff on September 23 a 
chapter-by-chapter summary of the principal chapters in a 
60-plus page policy paper that had been a year in the making. 
 The opening chapter laid out general principles, 
establishing the party's economic approach as essentially 
"social democratic."  Principal objectives underscored up 
front included establishment of a more participatory 
democracy, measures to create a functioning economy, and 
effecting redistributive justice. 
 
3.  (SBU) Chapter two outlined immediate priorities to be 
addressed: (1) reconstituion of the political structure, 
including the civil service, (2) measures to turn around 
failing social infrastructure, such as health, education, and 
transportation systems, (3) the HIV/AIDS crisis, (4) job 
creation, (5) and land reform.  Biti observed that the 
degraded civil service would pose one of the party's biggest 
challenges upon assumption of power, although a hardy core of 
professionals yet survived the onslaught of political and 
economic pressures.  Chapter Three addressed "cross-cutting 
issues", such  as labor, gender, land productivity, and 
trade. 
 
4.  (SBU) Biti described Chapter Four, which focused on 
macroeconomic issues, as the paper's most weighty.  Sketched 
out without too much detail would be interest rate and 
foreign exchange policies, and measures to stem spiralling 
inflation.  The paper called for 100 percent retention of 
foreign currency by exporters and a more realistic exchange 
rate, among other things.  Budget deficits were likely to be 
severe -- 25 percent of GDP after the first year "if we're 
lucky."  The paper's vetting process had resulted in a 
scaling back of earlier expensive party promises, such as 
free anti-retrovirals for needy patients. Biti acknowledged 
that some of even the most obvious remedies would be 
difficult for certain segments of the public to swallow, but 
the most knowledgeable, including some within ZANU-PF, 
recognized their necessity.  Indeed, he expected that ZANU-PF 
would borrow some of the ideas, and that some proposals could 
find their way onto an agenda for inter-party talks.  Chapter 
Five would describe the treatment of various sectors, 
including mining, agriculture, and transportation. 
 
Redistributive Justice Under Land Reform 
---------------------------------------- 
 
5.  (SBU) On land reform, Biti said the paper was based on 
the premise that the country could not afford either the 
status quo or the status quo ante.  He asserted that the 
paper's treatment of the topic was built on the party's 
"Synopsis of Land Reform" released in April 2000, which built 
on the 1998 donors' conference on land reform.  The approach 
hinged on four basic principles: (1) conveyance would be 
voluntary, (2) one-man one-farm, (3) maximum plot sizes would 
be determined regionally, (4) a punitive tax would be imposed 
on unused land.  Redistribution would be conducted in three 
phases: a land audit to determine actual occupancy and use on 
a farm-by-farm basis; an examination of historical and legal 
claims to the property; and the awarding of legal possession 
by a land commission.  He said possession would be based 
largely on long-term leases along the lines of the model 
employed in Zambia, with beneficiaries determined according 
to needs and abilities. 
 
International Role Under RESTART 
-------------------------------- 
6.  (SBU) As for an international role in Zimbabwe's 
recovery, Biti said the paper did not expressly address it 
but that everybody recognized its importance.  The party 
would be approaching the diplomatic community at the 
appropriate time to encourage formation of a "Marshall Plan" 
for Zimbabwe.  He conceded that the country would probably 
require at least three years of sustained structural reform 
before foreign direct investment was likely to become a 
significant economic factor. 
 
7.  (SBU) Biti said the paper had been circulated to 
prominent Zimbabwean and regional academics for comment.  He 
expected that some of their comments to be incorporated in 
the next draft, which was due out by the end of September. 
That draft would be sent to wider audiences for comment, 
including to the USG. 
 
8.  (SBU) Shadow Finance Minister Tapiwa Mashakada on 
September 24 presented econoff with a draft of RESTART, a 
copy of which Embassy is pouching to the AF/S.  Mashakada was 
more explicit than Biti in stressing the need to line up 
donor funding for RESTART and a future MDC government. 
 
COMMENT 
------- 
 
9.  (SBU) A cursory review of the RESTART draft shared by 
Mashakada shows it to be extremely vague in critical areas, 
perhaps a consequence of the MDC's very large "tent" that 
includes business and labor, white farmers, and socialists. 
It is mostly a rehash and update of "The Bridge," the party's 
economic campaign document for the 2002 presidential 
elections.   RESTART is perhaps not as specific an economic 
manifesto as we would hope from a party ready to govern, but 
it is  certainly an improvement on the unrealistic or 
non-existent economic planning of the current government. 
 
10.  (SBU) Because meaningful political change is generally 
accepted as a necessary precondition for meaningful economic 
change here, the MDC's paper is likely to remain principally 
an academic exercise for some time.  Nonetheless, MDC 
attention to difficult economic issues is a positive and 
overdue development, even if its prescriptions remain vague 
and unrealistic in some areas.  For now, the party enjoys the 
luxury of time and the absence of publicity or public 
expectation in crafting its economic policies.  The paper may 
face a bumpy road, though, when subjected to greater scrutiny 
among the diverse interests represented in the MDC's 
leadership and broad membership, particularly from trade 
unionists and academics who tend to reject "liberal 
economics."  The recommendations can be expected to provoke 
knee-jerk opposition by the ruling party in the short term, 
but could become relevant to an agenda for inter-party talks 
-- should they ever move forward. 
 
11.  (SBU) Biti and Mashakada may be emerging as rivals for 
control of MDC economic policy.  Neither would appear to make 
an initially-promising economic minister given the gravity of 
 Zimbabwe's economic condition.  Both are well under 40 while 
lacking substantive private-sector business or public-sector 
budgeting background.  Many moderate, working-level ZANU PF 
administrators in the Finance, Trade and the technical 
Ministries bring considerably more hands-on experience and 
expertise to the table (even if their proposals are being 
presently stymied by Mugabe and hardline ZANU-PF ideologues). 
 Most businessmen hope an MDC president would enlist a 
prominent private-sector figure to steer a Finance Ministry 
tasked with turning around what has been - by some measures - 
the world's fastest declining economy over the past 3 years, 
rewarding young and loyal MDC stalwarts like Biti and 
Mashakada with deputy minister and permsec positions. 
 
12.  (SBU) BIO NOTE: An extremely energetic and engaging 
interlocutor, Biti is at once confident and self-effacing.  A 
successful labor and constitutional lawyer with an old-line 
Harare firm, he readily conceded his lack of credentials in 
economics.  Nonetheless, he was very enthusiastic about 
economic themes and stressed his interest in the experiences 
of other developing countries emerging from political strife, 
such as Chile, Peru, and even post-war Europe.  He emphasized 
his excitement in being at the fulcrum of Zimbabwean history 
but claimed to be tired of politics, notwithstanding his 
youth.  Biti said he did not intend to run for parliament in 
the next election, and speculated that he may pursue an 
academic or business position overseas for some time after 
his term expired, with a view to learning first hand about a 
"successful developing country model", such as Malaysia. 
 
SULLIVAN