How Diaspora can drive regime change

By Freeman Chari

In my last article I proffered that Zimbabwe is completely in the hands of ZANU PF and that there is no hope for a free and fair election as long as the current cabal is intact.

It seems however that many who read the article found it logical to conclude that if elections would not present a change in government, then an armed conflict would be the only way to institute structural changes. I believe there is another way that could be effective, clean and constructive.

Remember I talked about an attempt by ZANU PF at creating a new State that has foundations on its ruling elite. What ZANU PF’s inner circle is primarily seeking to do is to build an empire that has the ability to control both the national resources and the government. 

In controlling the national resources this group will be able to freely operate and multiply its wealth. They know they will not be able to freely operate in future if they do not have security, thus they romped in the core of the military into the inner cabal. What is left now is to ensure that they have the ability to influence who gets into government and who does not. This will be easy for them in future but not now.

If the inner cabal which revolves around Mugabe, Mnangagwa and Mujuru is left unchecked by 2020, all major companies in Zimbabwe will belong to them. Right now all productive land in Zimbabwe belongs to them. They now control the primary mode of production.

They now literally control the raw resources of Zimbabwe including minerals. What they are doing now is to take control of all other companies in the country. They talk of indigenization when they know that in 2008 they reduced all Zimbabweans to paupers by literally freezing all the money that they had in banks.

The plot from 2004 was to print paper money which they would use to buy foreign currency on the black market and stash it somewhere else. They allowed inflation to spiral because it was necessary to have all other Zimbabweans as beggars so that they would not in future pose as threats in the competition for resources.

What we are seeing now is an attempt to clean dirty money and make it acceptable into the economy whilst asserting their influence over all other people in the country.

Indigenization demystified

The inner cabal through its banker Gideon Gono managed to collect money though the black-market at virtually no cost because they bought it with worthless paper. It is estimated that they amassed approximately US$ 2 billion over the four years. Since 2006 ZANU PF through proxy companies has been mining diamonds and secretly selling them to the Chinese and other eastern countries.

The money did not go into State coffers but straight to ZANU PF. It is estimated that they make about $1.7 billion annually through the diamonds. That is about $6.8 billion over 4 years. What this means is that ZANU PF has about $8.8 billion stashed somewhere outside the official economy of the country. This money is dirty money which they can easily lose for example if for some strange reason China’s policy towards Zimbabwe changes assuming the money is in Chinese banks.

So the next stage is now to spruce the money, making it clean and send it into the official market as legit. They know that it will be a very tough decision for United Kingdom to impulsively freeze the operations of companies like Anglo American Corporation, Rio Tinto, Barclays Bank and Standard Chartered Bank which have their origins in that country. Zimbabwe has about 600 of such foreign companies. ZANU PF came up with the controversial indigenization law which requires all foreign companies to shed 51 percent of their stakes to indigenous Zimbabweans.

ZANU PF knows that every other Zimbabwean who was not within the ZANU PF system in 2008 is now a pauper.  They have $9 billion waiting to be used in the crusade. By law, all the 600 companies will cede 51 percent to ZANU PF. This time they are not going to seize companies without compensation; they are legally going to pay for the 51 percent using dirty money.

If applied with speed ZANU PF will be controlling all the land and all the companies in Zimbabwe very soon. So the concept of indigenization although very attractive to poor Zimbabweans is not meant to benefit them but to assert the authority of an inner cabal of ZANUPF. We have helped to build this empire through our sweat which was bought through worthless paper.

The toothless government in 2020

When the dust settles, sanctions will not make much sense. Production will grow. ZANU PF will now be able to invest in agriculture. This will be simple; ZANU PF will now be controlling the chain of wealth creation. They will be able to farm tomatoes on their farms, instead of selling them at Mbare Musika; they will now be able to make rich pickings at Unilever which they would own. The tomatoes will be made into Royco which they would sell and again make rich pickings through OK Zimbabwe which they will also own.

Eventually the issue of running around in parliament and government will become too tedious and dirty for the inner cabal. They will then be willing to shed offices of the government to other acceptable individuals who will be screened so that they would not put the cabal’s interests at risk. The State will then be able to pacify general Zimbabweans through fringe benefits associated with a reviving economy. Eventually jobs will be available as the companies grow and reinvest in other sectors.

When people begin to get food they will begin to worry about who is ruling them. So the final stage will be to create another political party that is again controlled by the inner cabal. This party will challenge ZANU PF in elections and win. It will be acceptable because it will in other words be another ZANU PF although with a different name and different personalities. The net effect of development is that the inner cabal’s interests will still be protected. Eventually we will have a bi-partisan country run and controlled by monsters.

Building an alternative to the ZANU PF State

I have gone to this length so that we can all appreciate the seriousness of ZANU PF. At face value the only way to stop ZANU PF is to take up arms and topple them. This is not attractive neither is it feasible because Zimbabweans are fresh from war and they know how destructive and painful it is. Secondly, for an alternative army to be built there is need for resources. Already MDC and NGOs in Zimbabwe have milked western donors since 1999 and signs of donor fatigue are showing as it becomes apparent that it is improbable for MDC to rule Zimbabwe.

Lastly, there is minimal immediate gain for the West in Zimbabwe. War in Zimbabwe will be a liability to them as they would also be expected to bear the burden of rebuilding a ravaged country. Smart regime change remains the only acceptable option for them.

The hope for smart regime change lies in the Zimbabwe Diaspora. Zimbabwe has approximately 2 million people who are outside the country. This body of people is very important economically. There hasn’t been a strategy to harness the economic power of the Diaspora especially from the pro-democratic side of the political divide.

The importance of Diaspora remittances in propping up economies cannot be understated. Philippines received about $16 billion from it Diaspora in 2008 whilst Ethiopia received about $780 million in 10 months in 2010. It is this strength that we ought to harness for us to create an alternative and rival State in Zimbabwe.

There are some assumptions that we have to make before positing the alternative solution.  We are going to assume that of the 2 million people outside the country only 25 percent are formally employed or are productive. We will also assume that on average only 200 000 are able to spare a minimum of $1000 which can be used for investment purposes. 

What we need is a Collective Investment Trust that has the ability to raise capital, engage in business, create and multiply wealth. If initially 1000 people are found who are willing to invest at least $5000 each into the CIT over a period of a year (2012), the Trust will be able to raise $5 million over that period.  This money would be spun through short-term, high-turnover investments coupled to startup of sustainable businesses that need limited capital injection in the Diaspora.

There is a lot of untapped business potential in the world that the Trust can exploit. A lot of brilliant business ideas are dying because we do not have access to capital. The Trust would act as an investment vehicle for its beneficiaries which are primarily the 1000 people.

As the empire of the Trust grows it begins to initiate formation of other investment vehicles be it other Trusts, companies or corporations which would be under its wings but whose drive would be to harness the financial power of the Diaspora through providing a platform for Zimbabwe-centric investment opportunities.

Let’s assume that 200 000 people decide to invest at least $1000 into business entities controlled by the CIT. It means the Trust will have access to $200 million in raw capital. We will assume this process takes a year.

We have to remember that every human being wants a return on his investments. So for avoidance of doubt I am not suggesting an ujamaa or a compassionate entity. I am suggesting a complete profit-making empire whose primary objective is to make income for its beneficiaries but aiming at taking over the economic structures in Zimbabwe.

Investment after 2014 would be two pronged in that; the external investment will be solely to make maximum profit whilst internal investments would be aimed at starting up business along politically strategic but profitable lines. For example, Zimbabwe does not have an efficient payment gateway that has the capacity to support online transactions.

We ought to look at the relationship between PayPal and EBay to get an insight. EBay provides a platform for people to sell and buy merchandise all over the world. PayPal processes the payments that happen so that if one buys something in Thailand yet resides in Uganda, he can send money easily by the click of the computer button. EBay owns PayPal and most of the $2.5 billion profit made in 2010 was driven by business done through PayPal.

Zimbabwe does not have any company that has been operating these services and because of sanctions EBay and PayPal are not accessible to inland Zimbabweans. This is just one of the many fields that are awaiting exploitation.  How strategic is both EBay-like and PayPal-like business in Zimbabwe?

Introduction of these technologies will provide employment to a significant number of people which is a positive to our people. In terms of the overall political objective it means a significant angle of influence will be in progressive hands.

We will need investment into all sectors that would allow us to exert an influence in future. Investment within the country will be limited in terms of company size but expanded in terms of sector coverage. This will be done so as to avoid loss due to the possibility of expropriation by ZANU PF.

The drive will be through proxy entities that are wholly owned by Zimbabweans. We need to get insight and advice from business people who have managed to stay afloat in Zimbabwe despite their opposition to the system for example Strive Masiyiwa who owns Econet Wireless.

The need to have small companies scattered across sectors is to provide competition to ZANU PF where it already controls and to lay an early claim to stakes in areas it has not explored. In future, we will be able to inject capital into these companies so that they can effectively compete and possibly outwit ZANU PF owned companies in these sectors. In niche areas we will be able to silently and covertly exert our dominance.

External investment will also be aimed at capacitating the movement in areas that may become important in future exertion of force. These include military technology, satellite technology and general  advanced technology. This may not be important today as this thrust is none-physical  and non-military.

In future we may need to counter the aging ZANLA/ZIPRA influence through provision of substitutive military influence that would enable the army to move away from obsolete methods to professional and modern methods. This will allow us to exert our military mighty on the security apparatus in the country.

The advantage that the Diaspora has over ZANU PF is that they are not subject to sanctions. They have the ability to exploit the global village without restrictions related to the current political situation in Zimbabwe.

This means that the pace of growth emanating from external engagements will be much faster than that of ZANU PF . Assuming that the return from investments is 100 percent per annum then the empire can reach a $1 billion mark in 4 years. 

This growth is important only if it is not coupled to a growth on ZANU PF’s empire. So it is important to maintain the economic pressure on ZANU PF so that they do not have a chance to trade meaningfully. Political pressure will be piled too to foreign companies operating in Zimbabwe either to scale down or leave.

It will also be important to forge an alliance with the owners of these multi-national companies so that once ZANU PF begins to release the dirty money into their coffers they can alert the international community so that we can reclaim the money.

Is MDC necessary in this?

The purpose of MDC in all this is to hold fort and continue to stall ZANU PF progress. We need MDC so that we continue to have meaningful retardation of ZANU PF’s cruise to total control. We need the MDC also to provide hope to those within the country even though it will be hard for it in its current form to wrestle power from ZANU PF.

We will need to bring on board those within the MDC who have the mental and financial aptitude to sustain the crusade. It is anticipated that if MDC does not gain power in the next election donor fatigue will creep in meaning that the fluidity of the party will be compromised. The MDC would be encouraged to invest in the project so that over time it will be able to derive from the return on investments to fund its operations.

This would allow us to exert a Zimbabwe-centric  agenda on the party and to build on certain ideas that would have been unpopular with the current party donors. The relationship with MDC will be dependent on how open the party is to visionary leadership otherwise we will run the risk of having the economic thrust being tainted by controversies that may not be needed especially in the early years.

In the event that MDC does not provide a desirable platform then an alternative vehicle will be formed that will be able to assert its power in due course.

Who Organises the Diaspora?

Organising people to initiate idea is difficult given that naturally human beings have a fear of being pioneers. It will take a few willing individuals to commit themselves to the initial stages. An attempt to launch one such Investment Trust in Botswana attracted 45 Zimbabweans in 2009. This goes to show that people are willing to commit their funds to anything that will generate wealth for them.

Organisations that have been formed to represent the Zimbabwean Diaspora should be approached so that they can influence their organized networks towards investment. These include the Global Zimbabwe Forum and the Development Foundation for Zimbabwe (DFZ).

In conclusion

What I have proffered here is an attempt to build a capitalist approach to toppling a dictatorship. The question that many who have  a leftist inclination will ask is; what difference exist between the state that we will seek to build and the state that ZANU PF is building since both have no inclination towards the masses?

The answer is simple; we will be doing this in good faith. We cannot bring all humanity to a point where they own equally but we can create an environment that allows humanity to flourish.

Remembering that we are targeting 200 000 people initially, it is our hope that with the growth of the trust more people within the empire will be empowered to explore other business avenues thereby ensuring an evolution of a ruling class from a working class. The policies of the emergent government will be protecting the rights of workers and all the people of Zimbabwe.

Freeman Chari is a former student leader in Zimbabwe