Granted sanctions hurt our economy but let us go back in time to the time before sanctions and ask ourselves when did the Zimbabwe dollar fall spectacularly, when Zimbabwe decide to invest billions in a war in Congo that was not authorized by our own Parliament, when we undertook a rushed up, patched up land reform programme before we evaluated the effect it would have on our economy. It is a perculiarly Zimbabwean reflex to point at anyone else but ourselves!
The Zimbabwean currency dropped dramatically in late 2003, 1 year after the introduction of ZDERA in early 2002, and 2 years after the murder of Laurent Kabila, who Zimbabwe went in to help.
Hyperinflation in Zimbabwe was caused by ZDERA, not the presence in the DRC years earlier.
Zimbabwe had a robust balance of trade, until the year ZDERA came into force in 2002.
The $322 million trade surplus of 2001 turned into a trade deficit of $18 million in 2002, the year of the credit freeze. This is because nearly all trade is done on credit. The Zimbabwean government was forced to operate on a cash only basis since 2002, which lead to hyperinflation, destroying the national currency.
The sanctions in the Zimbabwe Democracy and Economic Recovery Act of 2001 (ZDERA), S.494 of the 107th US Congress, were intended to destroy the Zimbabwean currency, by making the Zimbabwean government operate on a cash only basis - with obvious results.
They were drafted by the MDC (Eddie Cross, Tendai Biti) and introduced by the Bush Administration in early 2002.
They make it impossible for the government to reschedule loans, or take new loans, or operate on credit as all countries do.
(c) MULTILATERAL FINANCING RESTRICTION- ... the Secretary of the Treasury shall instruct the United States executive director to each international financial institution to oppose and vote against--
(1) any extension by the respective institution of any loan, credit, or guarantee to the Government of Zimbabwe; or
(2) any cancellation or reduction of indebtedness owed by the Government of Zimbabwe to the United States or any international financial institution.
(2) MULTILATERAL DEVELOPMENT BANKS- The term `multilateral development banks' means the International Bank for Reconstruction and Development, the International Development Association, the International Finance Corporation, the Inter-American Development Bank, the Asian Development Bank, the Inter-American Investment Corporation, the African Development Bank, the African Development Fund, the European Bank for Reconstruction and Development, and the Multilateral Investment Guaranty Agency.
I agree with the definition "coercive measure to penalize...", but you seem to misinterpret "penalize" as applied to providing loans. A loan is not a right, it is a privilege. Refusing a loan is not "penalizing". You must not assume being entitled for any loan in a first place. Penalizing would be a refusal to buy products of independent Zim companies or to sell products to them. So far this is not the case. Besides, if Zimbabwe can not get a loan elsewhere, why would US/EU would be obliged?
thanks Znaika1...I have to admit this is the most constructive so far of your comments...I will garce you with my time: As mentioned in the video, The sanctions I spoke of were those by the USA...not EU or any other nation. As said, the US has a controlling stake in almost all global lending institutions. If they pass a law such as the one mentioned...this will mean that they will "advise" IMF, WB and all their institutions not to lend.
And as you may know, if the IMF or WB (of all institutions) refuses to lend to you, most other lenders will not lend (because IMF and WB are really the "lending standards). This does not matter if it is a political or an actual reason why the bank will not lend.
Search this on google: "Barclay's' millions help to prop up Mugabe regime" - read how huge banks like Barclay's actually agreed with and funded land reform, but the UK govt "advised" them to stop and hence they had to.
"And as you may know, if the IMF or WB (of all institutions) refuses to lend to you, most other lenders will not lend (because IMF and WB are really the "lending standards)."
It is because when IMF with its unprecedented 1.4% interest rate finds it economically impossible to lend, then the rest has no chance. If, for purely political reasons, IMF does not provide a loan to a country that is economically sound, there will be plenty of commercial banks and governments willing to lend for 2-4%.
US has IMF under control, but there are other countries that are not under US or EU control. China, for instance, best friend of Mugabe is swelling with money. In fact currently they do not know where to invest, as US debt becomes less and less secure. Why would they not give a loan to Zimbabwe? Russia, second best friend, recently offered 5 billion to Iceland, why would Russia not give a few billion? And if they don't, then why? And why would anyone else want to do it if China and Russia don't?
Search: "Zimbabwe close to Russian bailout" - the first result will pay testament.
As for china search: "Zimbabwe china billion" - the first result will also be sufficient.
Those prospects are still being worked on. We are still to see how they pan out. As for other forms of trade as you know China has heavily invested in Zim over the last 4 years and tourism from China has surged.
so far I have shown that China and Russia and even private western institutions have interest. What say ye?
So, then US and EU sanctions are void, right? Ineffectuated as they must have been when taken by only a few out of many. Russia, India and China come to the rescue. So effectively US and EU sanctions do not have any impact on Zimbabwe and Zimbabwe has nothing to worry about. Problem solved, right?
as you know, you have just made a silly comment. Again things have to be black or white. Because China, Russia and some institutions are willing to invest in Zim it doesn't mean it's all rosy. In the same way that because the G20 met and "agreed" it doesn't necessarily mean respite for the average American....you see the point of these videos is to show that things are not black and white. I assume you are Zimbabwean. and if so, do you not see that you are part of the "polarisation' problem?
Granted sanctions hurt our economy but let us go back in time to the time before sanctions and ask ourselves when did the Zimbabwe dollar fall spectacularly, when Zimbabwe decide to invest billions in a war in Congo that was not authorized by our own Parliament, when we undertook a rushed up, patched up land reform programme before we evaluated the effect it would have on our economy. It is a perculiarly Zimbabwean reflex to point at anyone else but ourselves!
ilahkiz 2 years ago
The Zimbabwean currency dropped dramatically in late 2003, 1 year after the introduction of ZDERA in early 2002, and 2 years after the murder of Laurent Kabila, who Zimbabwe went in to help.
Hyperinflation in Zimbabwe was caused by ZDERA, not the presence in the DRC years earlier.
tigerone1970 2 years ago
@ilahkiz
Zimbabwe had a robust balance of trade, until the year ZDERA came into force in 2002.
The $322 million trade surplus of 2001 turned into a trade deficit of $18 million in 2002, the year of the credit freeze. This is because nearly all trade is done on credit. The Zimbabwean government was forced to operate on a cash only basis since 2002, which lead to hyperinflation, destroying the national currency.
All economic misery flows from these sanctions.
tigerone1970 2 years ago
The sanctions in the Zimbabwe Democracy and Economic Recovery Act of 2001 (ZDERA), S.494 of the 107th US Congress, were intended to destroy the Zimbabwean currency, by making the Zimbabwean government operate on a cash only basis - with obvious results.
They were drafted by the MDC (Eddie Cross, Tendai Biti) and introduced by the Bush Administration in early 2002.
They make it impossible for the government to reschedule loans, or take new loans, or operate on credit as all countries do.
tigerone1970 2 years ago
From ZDERA:
(c) MULTILATERAL FINANCING RESTRICTION- ... the Secretary of the Treasury shall instruct the United States executive director to each international financial institution to oppose and vote against--
(1) any extension by the respective institution of any loan, credit, or guarantee to the Government of Zimbabwe; or
(2) any cancellation or reduction of indebtedness owed by the Government of Zimbabwe to the United States or any international financial institution.
tigerone1970 2 years ago
(2) MULTILATERAL DEVELOPMENT BANKS- The term `multilateral development banks' means the International Bank for Reconstruction and Development, the International Development Association, the International Finance Corporation, the Inter-American Development Bank, the Asian Development Bank, the Inter-American Investment Corporation, the African Development Bank, the African Development Fund, the European Bank for Reconstruction and Development, and the Multilateral Investment Guaranty Agency.
tigerone1970 2 years ago
I agree with the definition "coercive measure to penalize...", but you seem to misinterpret "penalize" as applied to providing loans. A loan is not a right, it is a privilege. Refusing a loan is not "penalizing". You must not assume being entitled for any loan in a first place. Penalizing would be a refusal to buy products of independent Zim companies or to sell products to them. So far this is not the case. Besides, if Zimbabwe can not get a loan elsewhere, why would US/EU would be obliged?
Znaika1 2 years ago
thanks Znaika1...I have to admit this is the most constructive so far of your comments...I will garce you with my time: As mentioned in the video, The sanctions I spoke of were those by the USA...not EU or any other nation. As said, the US has a controlling stake in almost all global lending institutions. If they pass a law such as the one mentioned...this will mean that they will "advise" IMF, WB and all their institutions not to lend.
crazyintellect 2 years ago
And as you may know, if the IMF or WB (of all institutions) refuses to lend to you, most other lenders will not lend (because IMF and WB are really the "lending standards). This does not matter if it is a political or an actual reason why the bank will not lend.
Search this on google: "Barclay's' millions help to prop up Mugabe regime" - read how huge banks like Barclay's actually agreed with and funded land reform, but the UK govt "advised" them to stop and hence they had to.
crazyintellect 2 years ago
"And as you may know, if the IMF or WB (of all institutions) refuses to lend to you, most other lenders will not lend (because IMF and WB are really the "lending standards)."
It is because when IMF with its unprecedented 1.4% interest rate finds it economically impossible to lend, then the rest has no chance. If, for purely political reasons, IMF does not provide a loan to a country that is economically sound, there will be plenty of commercial banks and governments willing to lend for 2-4%.
Znaika1 2 years ago
indeed
crazyintellect 2 years ago
US has IMF under control, but there are other countries that are not under US or EU control. China, for instance, best friend of Mugabe is swelling with money. In fact currently they do not know where to invest, as US debt becomes less and less secure. Why would they not give a loan to Zimbabwe? Russia, second best friend, recently offered 5 billion to Iceland, why would Russia not give a few billion? And if they don't, then why? And why would anyone else want to do it if China and Russia don't?
Znaika1 2 years ago
Search: "Zimbabwe close to Russian bailout" - the first result will pay testament.
As for china search: "Zimbabwe china billion" - the first result will also be sufficient.
Those prospects are still being worked on. We are still to see how they pan out. As for other forms of trade as you know China has heavily invested in Zim over the last 4 years and tourism from China has surged.
so far I have shown that China and Russia and even private western institutions have interest. What say ye?
crazyintellect 2 years ago
So, then US and EU sanctions are void, right? Ineffectuated as they must have been when taken by only a few out of many. Russia, India and China come to the rescue. So effectively US and EU sanctions do not have any impact on Zimbabwe and Zimbabwe has nothing to worry about. Problem solved, right?
Znaika1 2 years ago
as you know, you have just made a silly comment. Again things have to be black or white. Because China, Russia and some institutions are willing to invest in Zim it doesn't mean it's all rosy. In the same way that because the G20 met and "agreed" it doesn't necessarily mean respite for the average American....you see the point of these videos is to show that things are not black and white. I assume you are Zimbabwean. and if so, do you not see that you are part of the "polarisation' problem?
crazyintellect 2 years ago