ZIMBABWE is in an unenviable position over whether elections will or won't take place by July 31 2013.
If the country holds elections by the said date, some political parties might boycott the polls or dispute their outcome, and if it doesn’t, the economy is likely to sink further into a hard-to-recover crisis.
Whatever Zimbabwe’s political leaders decide to do about when to hold the upcoming elections, they will still be criticised by some sections of the country’s citizenry.
Indeed, President Robert Mugabe is in a catch-22 situation which stems from the recent ruling by the country’s Constitutional Court compelling him to proclaim elections by July 31 2013.
Already, several political parties have ganged up to resist Mugabe’s bid to hold elections according to this ruling.
If the president goes ahead with proclaiming the polls, the outcome - let alone the election itself - will not be accepted by the other parties within and outside the current Global Political Agreement (GPA).
The MDC-T through its leader Morgan Tsvangirai is on record as saying they will not accept Zanu-PF’s bid to stampede elections without reforms.
Other parties have also joined in and together have agreed to push the Southern African Development Community, the guarantor of the GPA, to stop Mugabe from forcing a snap poll without following the constitutional roadmap.
As it stands, Zimbabwe will be damned if elections are held as per the court ruling as other parties will boycott or dispute the outcome, a scenario likely to reverse whatever stability the country had enjoyed since the GPA was formed.
Not having elections sooner, however, will also reverse whatever economic gains or recovery the country has gained since the formation of the inclusive government.
Finance Minister Tendai Biti, a top MDC-T official, last month urged Mugabe to proclaim election dates because continued uncertainty over when the polls would be held was negatively affecting the economy.
Biti said most businesses had adopted a wait-and-see attitude due to uncertainty over election dates. He noted that the economy could have shrunk by up to 3% during the first four months of the year because of political uncertainty.
“The biggest factor of all is the hanging factor that is being brought in by the election. Businesses are just hanging in there, unsure of what to do given the uncertainty pertaining to the lack of clarity on the exact date of the election."
Biti said a survey carried out by his ministry indicated that manufacturing sector firms had recorded huge declines and near stagnation in production volumes compared to those recorded last year.
He said the reduction of broad money supply, which declined to 10.4% in March from 12.91% during the previous month, has also shown signs of a weakening economy.
“Even the slowdown in inflation is not something pleasing as it is attributed to depressed demand due to liquidity constraints.”
The liquidity situation in the country remains constrained and as a result there is weak demand for goods and services.
Weakness in the labour market due to the high unemployment rate and relatively stagnant salaries as well as the lack of credit will continue to act as a headwind to discretionary consumer spending, and in the process hinder any form of growth.
What the minister said is also evident if one considers what most listed entities having been saying at their results briefings and trading updates.
Business has just slowed, especially in the last five months. Companies that were recording exceptional growth since dollarisation have all bewailed the state of the economy.
Lafarge’s performance in the first four months was unchanged with revenue of $21.7m, almost the same figure posted in the comparative period. Company management said the results on the ground indicated that the country’s gross domestic product growth rate will probably be much lower than the projected 5%.
The Zimbabwe National Chamber of Commerce also called on political leaders to reach a consensus and get on with the elections, as the current focus on politics is badly affecting business and the economy as a whole.
Will Mugabe call or not call for elections before July 31 2013? Whatever he decides, Zimbabwe will be damned if he does, and damned if he doesn’t.
*Malcom Sharara is Fin24’s correspondent in Zimbabwe. Views expressed are his own.
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