From: barnhart@ddsw1.MCS.COM (Mr. Aaron Barnhart)
Newsgroups: soc.culture.african
Subject: IPS:ZIMBABWE: NEW LOANS SATISFY OFFICIALS BUT EXPERTS ARE WORRIED
Date: 16 Dec 92 02:51:49 GMT
Organization: Evanston, Illinois, U.S.A.

Copyright Inter Press Service 1992, all rights reserved.  Permission to re-
print within 7 days of original date only with permission from 'newsdesk'.

Reference: Trade & Finance
Title: ZIMBABWE: NEW LOANS SATISFY OFFICIALS BUT EXPERTS ARE WORRIED


an inter press service feature

by daniel martinez

paris, dec 5 (ips) -- zimbabwe's finance minister bernard
chidzero came away from a meeting of the consultative group on
the african country heartened by fresh financial support for a
structural adjustment programme the harare government is
implementing.

but experts are less satisfied. they warn that the programme
is inefficient and its social cost is excessive.

the meeting, held this week in paris and chaired by the world
bank, yielded loans totalling 1.2 billion dollars for zimbabwe,
chidzero told the press after the encounter.

he led zimbabwe's delegation to the meeting, which was also
attended by representatives of 15 industrialized countries and
international organizations, including the african development
bank.

chidzero told journalists that, despite his country's
difficult economic and social situation, due in part to its worst
drought in this century, harare is determined to continue the
structural adjustment programme.

he said the programme would continue ''with or without the
drought'' and he insisted on ''the understanding of our people''
despite the ''suffering'' which the drought and some spinoffs of
the adjustment programme have caused many of the southern african
country's 10 million inhabitants.

but experts on african affairs, including philippe hugon of
the university of paris, as well as economists like bruno coquet
of the french observatory of economic conjunctures, criticize the
''economism of the world bank's solutions for africa.''

''while it is certain that zimbabwe is a relatively developed
country compared to other african states in general and to
neighbouring mozambique in particular, this does not mean that
the so-called structural adjustment programmes are going to be
more successful than in other regions of the continent,'' coquet
said.

''everything depends on the objectives that are fixed: if it
is considered, as the world bank seems to believe, that the main
thing is to be in a position to pay off the external debt without
taking the social cost of adjustment policies into consideration,
it might perhaps be possible to say that such policies are
effective,'' he added. (more)
----


but if the objective is ''for example, to develop within the
framework of an increasing diversification of the economy, i do
not believe that these policies are the most adequate ones,''
coquet stressed.

according to hugon, ''the diagnoses of the world bank's
experts usually adjust to the reality and correctly analyse some
of the shortcomings of the diagnosed country.''

''however, the diagnosis is one thing and the 'therapy'
proposed is another. this therapy tends mainly to introduce
market logics that will supposedly attract private investments,
which is extremely doubtful,'' the economist explained.

hugon feels that ''the belief that the structural problems of
african economies, which go beyond the purely economic realm and
also require political initiatives, could be solved with private
investments is an illusion.''

''it suffices to look at what is happening in many african
countries which have been implementing those stabilization plans:
except in specific cases like the oil-producing countries --
gabon or nigeria, among others -- no one wants to make lasting
investments in a significant way,'' he added.

but even in the countries which have been able to attract a
significant level of investments, the results are doubtful in
terms of real development, coquet argues.

in gabon, for example, ''the vast majority of the population
continue to live in conditions of underdevelopment,'' he
explained.

''before speaking of economic adjustment, one would have to
take into account the local political reality as well as external
economic conditions,'' coquet opined.

''given the fact that these adjustments usually accentuate the
monoproduction of raw materials in the countries which apply them
-- like cocoa in ghana, which began its adjustment almost a
decade ago -- it would be logical to take the international
prices of those products into account,'' he added.

moreover, adjustment has meant greater dependence on a given
export at a time when prices for these raw materials have dropped
systematically, which, in turn, aggravates the situation of the
countries concerned in terms of dependency.

unlike countries like ghana, one of the african continent's
structural adjustment pioneers, zimbabwe started its economic
liberalization only in late 1989. it is therefore more difficult
to evaluate the result, moreso since this year's drought has
aggravated the situation.

chidzero said at the paris meeting that zimbabwe's gross
domestic product in 1992 is expected to be around 11 or 12
percent less than in 1991, when it had increased by 3.6 percent.

this year's drop was caused mainly by the drought, although
the international economic recession also had negative effects in
the african country, he said. (end/ips/trd/so/dm-da/kb/92)
Newsgroups: soc.culture.african