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Impact of sanctions against Zimbabwe

Posted: 2008-11-08
From: MNN
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The full text of a document compiled by the Reserve Bank of Zimbabwe Governor Dr Gideon Gono on the impact of sanctions against Zimbabwe was presented to the Pan-African Parliament.

(The Herald)


1 Given the nature and the far reaching adverse effects of sanctions against Zimbabwe, the subject matter can never be repeated long enough, for as long as the sanctions remain in place.

2 The manner in which some sections of the world community want to swing global opinion against Zimbabwe does not reflect concern for the welfare and well-being of the general population of Zimbabwe.

3 This reality becomes apparent when one analyses the true nature of these sanctions and the attendant effects on the economy and the generality of the Zimbabwean people.

4 Far from the claim that sanctions in Zimbabwe are ring -fenced and targeted, on a few individuals, the reality on the ground is that the tight grip of the declared and undeclared sanctions is being felt throughout the entire economy. This is to be found in legal statutes, such as the Zimbabwe Democracy and Economic Recovery Bill, enacted by the US Government.

5 When one reflects at the vision and purpose for which Multilateral Financial Institutions (MFIs), such as the International Monetary Fund (IMF) and the World Bank were conceived back in 1945, clearly shows that these institutions are deviating from their founding mandates.

6 These MFIs were essentially created to ensure international financial stability, through provision of bridging finance to countries experiencing temporary Balance of Payments (BOP) pressures. Under the weight of political persuasion it is now clear that the institutions have strayed from their core business.

7 Before the Land Reforms in Zimbabwe, the world was literally silent about the imbalances that existed in the ownership and distribution of national wealth. The prevailing situation was instead, passively preserved, and in the process, breeding what could have degenerated into a chaotic state of affairs in the country’s socio-geo - political landscape.

8 Having realised their potential danger and acting in good faith on the basis of promises given to, Zimbabwe at the Lancaster House Conference in 1979, the country initiated a land reform program, which triggered, the destructive seeds of hatred and demonisation by the West, in the form of declared and undeclared sanctions.

9 In order to fully appreciate the true nature of the sanctions against Zimbabwe, and how attempts are being made to mislead the world, it is important that one appreciates the various forms of economic warfare that have been visited upon Zimbabwe and its people.

10 Sanctions against Zimbabwe and indeed any other country are a declaration of war on a sovereign State, which puts the economy under siege, with negative downstream effects on the vulnerable groups and civilians at large.

11 The economic warfare against defenceless countries manifests itself through the cancellation of life-line projects, humanitarian assistance, and humanitarian infrastructural development support, which further worsens the plight of the poor nations.

12 Regrettably, the adverse impact of the weapon of economic sanctions has resulted in deteriorating standards of living, with per capita incomes in poor nations, being reduced to a mockery, compared to levels obtaining in those countries imposing illegal sanctions.

13 Sanctions, declared or undeclared, have regrettably claimed the lives of innocent children, the disabled and physically handicapped, through denial of medical equipment, drugs, and food.

Nature of Sanctions

14 Sanctions have traditionally been applied against certain countries to achieve desired political and economic outcomes. These largely consist of the imposition of embargoes, trade and financial restrictions, and diplomatic isolation.

15 In recent years, the coverage of sanctions has widened to include other elements that are not directly linked to trade and commerce such as culture and sports.

Economic Sanctions

16 Economic sanctions and related restrictions are by far the most important of all sanctions imposed on a nation. In the main, they consist of the withdrawal, or threat of withdrawal of trade and financial relations, including technical cooperation.

17 In an effort to refine the effectiveness of sanctions through disguised means, there has been a shift towards the so-called targeted sanctions, which impose travel bans and freezing of foreign bank accounts of targeted individuals or entities.

Trade Sanctions

18 Trade sanctions limit the country’s exports or restrict its imports. Trade barriers such as embargoes and quantitative restrictions are thus imposed on that country.

19 Countries such as South Africa, Iraq, and Rhodesia, had trade sanctions imposed against them, as the international community wanted to influence political changes in those countries.

20 In Zimbabwe, today, trade sanctions have taken the form of denied access to foreign lines of credit, which ordinarily finance external trade. The market for the country’s exports is also shrinking, as export competitiveness crumbles under the adverse perceptions.

Financial Sanctions

21 Financial sanctions impede financial flows such as aid, short and long term loans, thus reducing foreign exchange flows to Zimbabwe. Financial sanctions also interrupt commercial and trade finance, through reduction of both Government and private sector access to foreign loans.

22 In addition, sanctions also create an artificially bad country image which attracts high risk premium on offshore lines of credit, and eventually scare away alternative creditors, as they anticipate a credit squeeze in the future.

23 Thus, without the imposition of explicit trade sanctions, financial sanctions, especially involving trade finance, interrupts trade, and ultimately constrain the economy’s foreign currency generating capacity, as well as economic activity in general.

Undeclared Sanctions

24 Undeclared sanctions are not explicitly announced but are implied from the actions of the perpetrating nations.

25 For example, some Non Governmental Organisations have moved their operations out of Zimbabwe, since the enactment of the Zimbabwe Democracy and Economic Recovery Act of 2001. This Act outlines the scope of targeted sanctions on Zimbabwe by the USA.

Arrears Triggered Penalties

26 Due to Zimbabwe’s failure to honour its financial obligations to the IMF and the World Bank since 1999, the Bretton Woods Institutions suspended Balance of Payments support and technical assistance to the country.

27 Such actions by MFIs are notwithstanding the fact that such BOP assistance would have unlocked the country’s export potential, and create capacity for repayment of outstanding loans.

Effects of Sanctions on Zimbabwe

28 Since the imposition of declared and undeclared sanctions against Zimbabwe, the effects of these sanctions have been widespread and continuous.

Non Governmental Organisations (NGOs)

29 The majority of NGOs receive funding from Western Governments. Accordingly, some have realigned their policies in consultation with their donors.

30 As a result, some donors have either responded by withdrawing their programs or frozen further development assistance programmes in the country.

31 Other donors, through various NGOs have continued to work in Zimbabwe but have changed their areas of focus. Concentration of donor funding has now been limited to humanitarian aid and social issues, particularly HIV/Aids, social protection and human rights.

32 Humanitarian assistance is, however, short-term, and does not directly contribute to long term economic development and poverty reduction.

33 The NGO community in Zimbabwe is now faced with dwindling resources, as donor funds have either been severely reduced or re-directed to other countries.

34 Initially, Official Development Assistance (ODA) was paid through the Government. Following imposition of sanctions, the majority of NGOs now source ODA directly from donor organisations with very stringent and in some instances impractical conditions.

35 The National Association of Non-Governmental Organisations (NANGO) confirmed that aid meant for Zimbabwe has also been diverted to other third world countries on the back of politically motivated sanctions.

36 NANGO highlighted that, over the past few years, there has also been a major withdrawal of donor funding agencies. These pull-outs have resulted in closure and suspension of projects funded by NGOs.

37 The imposition of targeted sanctions has precipitated negative perceptions about Zimbabwe by the world at large. These negative perceptions make it difficult for the private and public enterprises to secure funding, as donor funding agencies are no longer willing to support projects in Zimbabwe.

38 In the aftermath of the socio-economic environment, created by sanctions, several NGOs and donor agencies have or are relocating their offices from Zimbabwe to neighbouring countries. For instance, DANIDA and the Canadian International Development Agency (CIDA) pulled out of Zimbabwe in 2001 and 2003, respectively, terminating all projects in progress and retrenching their employees.

39 All this is has adversely affected the vulnerable groups in Zimbabwe.

International Relations

40 In the same vein, the country’s relations with other countries, particularly from the West remained constrained, leading to the suspension of bilateral loan disbursements to Zimbabwe.

41 Following unrelenting pressure from the West, Zimbabwe was forced to terminate its membership in the Commonwealth on the 7th of December 2003. In addition, the IMF and the World Bank, also joined Western countries, and suspended all loan disbursements to Zimbabwe, with effect from 2000.

Multilateral Financial Institutions

42 Following the country’s land reform programme, which, triggered declared and undeclared sanctions against Zimbabwe, Multilateral Financial Institutions also imposed sanctions on Zimbabwe, as shown in Table 1 below.

43 MFIs imposed sanctions on Zimbabwe in the following manner:

l Suspension of Balance of Payments Support;

l Suspension of technical assistance;

l Suspension of voting and related rights by IMF; and

l Declaration of ineligibility to access Fund resources.

International Monetary Fund

44 After reviewing Zimbabwe’s overdue obligations on 25 September 2001, the Fund’s Executive Board declared Zimbabwe ineligible to access the general resources of the IMF. Zimbabwe was subsequently declared ineligible to borrow the Fund resources.

45 As a result, Zimbabwe has not been receiving any disbursements from the IMF as shown in figure 1.

46 On 14 June 2001 the IMF suspended technical assistance to Zimbabwe and adopted a declaration of non cooperation.

Figure 1: Average Annual IMF Disbursements (US$M)

47 On 6 June 2003, IMF suspended Zimbabwe’s voting and related rights, worsening the country’s economic difficulties.

48 The Fund also initiated the procedure on the compulsory withdrawal of Zimbabwe from the IMF in December 2003.

49 The initiation of compulsory withdrawal from the Fund is the last and most severe in a series of escalating measures the Fund applies to members that fail to meet the obligations.

50 The IMF recognised the severity of the decision at hand, the increases in payments from Zimbabwe since the last review in July 2004, and improvements in economic policy implementation. On the 16th of February 2005, the IMF decided to postpone a recommendation with respect to compulsory withdrawal, providing Zimbabwe with a chance to continue improving economic policies and payments.

51 Regrettably, despite the clearance of the critical General Resources Account (GRA) in February 2006, when Zimbabwe fully paid US$210.6 million it owed the Fund, the IMF Board upheld sanctions on Zimbabwe.

52 This decision came as a major surprise to Zimbabwe, since the issue of non-payment of GRA debts had been the major justification for the IMF sanctions to be imposed against Zimbabwe. Thus, effectively, the IMF rules were modified to ensure that Zimbabwe remained under sanctions.

World Bank

53 The World Bank has helped Zimbabwe to fight poverty and improve living standards. To date, the Bank approved 19 International Bank of Reconstruction and Development (IBRD) loans and 14 International Development Association (IDA) credits for a total of approximately US$1.55 billion.

54 The lending programme to Zimbabwe is currently inactive due to a combination of accumulated arrears and sanctions. Effective 2 October, 2000, the World Bank placed all IBRD loans and IDA credits to, or guaranteed by, Zimbabwe in non-accrual status. As a result, Zimbabwe has not been accessing loans from the World Bank as shown in Figure 2 below.

Figure 2: Average Annual World Bank Disbursements (US$M)

55 The International Finance Corporation (IFC) also suspended funding of infrastructural and private sector projects in Zimbabwe.

56 The Bank’s role is now only limited to technical assistance and analytical work, focusing on macroeconomic policy, food security issues, social sector expenditures, social delivery mechanisms and HIV/AIDS.

57 The World Bank, thus effectively imposed sanctions to Zimbabwe in the form of:

l Suspension of grants; and

l Suspension of Infrastructural Development flows to both Government and private sector.

The African Development Bank (AfDB)

58 The Bank Group commenced operations in Zimbabwe in 1982. To date, the Bank group has approved 24 operations comprising of 20 projects and 4 studies.

59 Zimbabwe has been in arrears to the Bank Group since 1999. Following this development, the Bank Group imposed sanctions on the country in May 2000 and subsequently stopped all lending operations in the country as shown in Figure 3.

Figure 3: Average Annual AfDB Disbursements

60 Although the Bank Group suspended normal lending operations, it pledged support in the form of capacity building activities.

Socio – Economic Effects of Sanctions

61 When targeted sanctions are directed against political leaders and Government officials of a particular country, it is usually the vulnerable groups of society who suffer and not the targeted group.

62 Former United Nations, Secretary General, Kofi Annan once bemoaned the adverse effects of sanctions, when he said ‘sanctions remain a blunt instrument, which hurt large numbers of people who are not their primary targets’.

63 Sanctions, whether disguised in any form, ultimately resulted in the deterioration of health services, shortages of drugs, and high infant mortality rates. Innocent civilians were thus, adversely affected by the sanctions.

64 Sanctions have also had adverse and downstream social and economic effects on the Zimbabwean economy’s key sectors.

Most of these effects have manifested themselves in shortage of foreign currency, resulting in the country accumulating external payment arrears and failing to import critical supplies.

Sectoral Effects of Sanctions

Balance of Payments Impact of Support Withdrawal Due to Sanctions

65 From time immemorial, Zimbabwe has never gone it alone. Evidence at hand clearly demonstrates that the country has depended in one way or the other on external support both in the pre-independence and post independence eras.

66 As shown Table 2 below, from 1966 to 1999, Zimbabwe registered capital account surpluses largely in the form of project finance, as well as budgetary and balance of payments support. Since 2000, the country started experiencing capital flight due to sanctions.

Table 2: Balance of Payments (US$M)

Source: Various RBZ Quarterly Economic Reviews

Figure 4: Net Capital Flows (US$M)

67 Since 1980, Zimbabwe has also continued to be supported by current and capital transfers from abroad in the form of food, medicines, and cash transfers from the international community. The increase in transfers since 1990 largely reflects humanitarian support against the background of recurrent droughts.

Figure 5: Net Current and Capital Transfers (US$ Million)

68 Regrettably, sanctions imposed on the country over the past seven years have, resulted in the drying up of project finance and balance of payments support. This negative development has had far reaching effects on the majority of the people and manifested itself through the following economic evils:

i. Denial of medication to the unborn child;

ii. Poor rural folks not able to grind their maize;

iii. School children not able to go to school;

iv. Transport system grinding to a halt;

v. Workers walking to work because of fuel shortages; and

vi. Blackouts due to electricity outages among many other ailments induced by sanctions.

69 It will be, therefore, naïve to for anyone to hold the view that these disastrous consequences are only affecting a few targeted individuals. Evidently, the impact of the sanctions is being felt across the generality of the Zimbabwean population.

70 Zimbabwe’s Balance of Payments position has deteriorated significantly since the year 2000. This unfavorable development emanated from the combined effects of inadequate export performance, and reduced capital inflows.

71 A combination of current account deficits and reduced capital inflows, resulted in excessive pressure on foreign exchange reserves, which, as a result, declined from US$830 million (3 months import cover in 1996) to less than one month of import cover by 2007.

72 The attendant foreign exchange shortages severely constrained the country’s capacity to meet foreign payment obligations and finance critical imports, such as drugs, grain, raw materials, fuel and electricity.

73 Reflecting the shortages of foreign exchange there has been a significant build up in external payments arrears. At the end of 1999, total foreign payments arrears amounted to US$109 million and have since increased significantly to US$2.5 billion by end of 2006.

74 This unfavourable development in the external sector has worsened the country’s creditworthiness as the country’s risk profile has deteriorated. This subsequently led to the drying up of traditional sources of external finance from bilateral and multilateral sources.

75 The withdrawal of the multilateral financial institutions from providing Balance of Payments support to Zimbabwe had a demonstration effect as some other bilateral creditors and donors also followed suit by either scaling down or suspending disbursements on existing loans for both Government and parastatals.

Figure 6: Grant Inflows

76 Reflecting the scaling down of donor support, and developmental assistance, Grant inflows, declined significantly from an annual average of US$138 million in the 1990s to US$39.9 million registered between 2000 and 2006.

77 Prior to this, the country had an perfect record of prompt debt servicing and was highly rated in the international financial markets.

78 The capital account, traditionally a surplus account, has been in deficit since 2000. This largely resulted from the perceived high country risk by both multilateral and bilateral creditors. As such international investors preferred other countries for investment, thus depriving Zimbabwe of the much-needed foreign direct investment.

Access to Credit Lines

79 Sanctions negatively affected the image of the country through negative perceptions by international financial markets.

80 Zimbabwean companies are finding it increasingly difficult to access lines of credit because of the perceived country risk. As a result, Zimbabwean companies have to pay cash for imports.

Figure 7: External Loan Inflows (US$M)

81 Loan inflows increased from an average of US$134.3 million in 1980s to US$480.3 million in the 1990s. Reflecting the adverse impact of sanctions, loan inflows declined to an average of US$49.3 million between 2000 and 2006 (refer to Figure 7 above).

82 As a result of the perceived risk premium, the country’s private companies have been securing offshore funds at prohibitive high interest rates.

83 This has had ripple effects on the country’s employment levels, and capacity utilisation as reflected by shortages of basic goods and services.

84 Declining export performance has also adversely affected the standards of living for the general populace. In the unfolding worsening economic conditions, the country has experienced large scale emigration, especially of skilled labour, thus further straining the economy.

Foreign Direct Investment

85 Foreign Direct Investment (FDI) is a key driver of economic growth in any developing economy. The purpose of FDI is to stimulate economic growth, and in particular FDI positively impacts on the country’s Balance of Payments position.

Figure 8: Foreign Direct Investment Inflows (US$M)

86 The negative perception associated with sanctions has adversely impacted on foreign direct investment to Zimbabwe.

External Loans (US$ Million)

Source: Various RBZ Quarterly Economic Reviews, Ministry of Finance.

87Foreign direct inflows increased significantly from an average of US$8 million in the 1980s to an average of US$95 million in the 1990s. Due to the negative impact of sanctions, FDI declined to averages of US$20.4 million in the new millennium.

88 Reflecting this, most multinational corporations such as Anglo-American have been strongly discouraged from investing in Zimbabwe by their home countries.

89 This has adversely affected investment levels into the country, thus, worsening the foreign exchange shortages leading to shortages of fuel and imported raw-materials.

90 The shortage of fuel has had a debilitating impact on all sectors of the economy, leading to a continuous decline in economic activity. This has generated additional inflationary pressures and speculative behaviour in the economy.


91 In the last 10 years, Zimbabwe has basically been on its own. The country has also relied on the resilience of its economy and its people.

92 Due to declining external budgetary support, Zimbabwe’s budget deficit has largely been financed from inflationary domestic bank sources.

93 Figure 9:Average Domestic Financing (Z$’000)

External budgetary support for Zimbabwe has completely dried up following suspension of loan disbursements for projects and BOP support.

Figure 10: Average Foreign Financing (Z$’000)

94 In contrast, most countries in Sub-Saharan Africa and elsewhere have continued to receive the bulk of fiscal budgetary support from the international donor community.

Budget Deficit Financing (Z$000)

Finance Statistics Year Book, RBZ Quarterly Economic Reviews, Central Bank Economic Surveys.


95 The country’s agricultural sector relied to a certain extent on funding from the donor community. The withdrawal of such support since the inception of the Land Reform Program negatively impacted on the sector.

96 The Danish International Development Agency (DANIDA) supported the Agricultural Sector Programme in the late 1990s to the tune of DKK 98.6 million (US$ 15.4 million).

97 The programme was aimed at:

i. Enhancing forestry extension services;

ii. Development of an agriculture policy;

iii. Development of a marketing information system;

iv. Supporting irrigation schemes to small holders;

v. Provision of training to smallholder farmers; and

vi. Provision of direct support to farming households to assist them in income generating activities.

98 The programme was suspended due to sanctions. The economy thus lost an opportunity to enhance food security.


99 The Education Sector Support Programme was established in January 1996 and was funded to the tune of Sek 95 million (US$13.9 million), by the Swedish government.

100 The project facilitated the supply of text books, special education needs, construction of school buildings, capacity building and promotion of gender equity in education.

101 The Swedish Government did not fund any new programs in the education sector after 2000. Such programs would have gone a long way in benefiting the country’s education system.

102 In addition, Africa University is currently failing to access computers and related accessories from American Information Technology (IT) companies. The sanctions imposed on Zimbabwe by the West, has thus spilled over to the country’s institutions of higher learning, by affecting their ability to procure modern technology, critical for learning purposes.


103 The Transport Sector Support Programme was funded by Danish International Development Agency (DANIDA), in April 2000. It was established to support the Transport sector with a value of DKK380 million or (US$48 million).

104 The programme was aimed at;

i. Rehabilitation and maintenance of the Harare-Nyamapanda and Kwekwe-Lupane roads;

ii. Institutional support to the road sector; and

iii. Labour based rural rehabilitation and maintenance of roads.

105 Had this programme been undertaken to completion, it could have created employment opportunities and enhanced trade through efficient movement of commodities within the country and the region.

106 In addition, the Labour-based Roads & Rehabilitation Works programme was established in October 1995, and was funded by the Swedish Government to the tune of Sek10 million or (US$15.1million).

107 The programme was aimed at rehabilitating 116km of roads as well as training indigenous small scale road contractors. This was meant to enhance entrepreneurial skills and capacity building for the rural population.

108 However, no new programmes have been put in place because of Sweden’s suspension of co-operation with Zimbabwe

Health Sector

109 DANIDA suspended Health Sector Support Programmes which were targeted at:

i. Supporting the provincial health service capacity building and policy issues to Ministry of Health & Child Welfare (MOHCW);

ii. Development of a gender strategy Support to HIV/AIDS activities;

iii. Integration of Zimbabwe Essential Drugs Action Program (ZEDAP) to national laboratories;

iv. Establishment of the health information system; and

v. Support to the Health Services Fund Transport Management.

110 The project was established in May 2000, and it was valued at DKK 235 million (US$ 29.7 million). The project was suspended as a result of the Land Reform Programme. The suspension of the programme subsequently affected the general health of HIV/AIDS patients.

111 The Health Sector Support Programme, established in April 1997 by the Swedish Government was funded to the tune of Sek 50 million (US$6.4 million).

112 The objectives of the project were as follows:

i. Improving water and sanitation;

ii. Health education and conditions of the disabled; and

iii. Prevention of the spread of HIV/AIDS related diseases.

113 Due to sanctions imposed on the country, the program was discontinued. Since 2000, no new programs have been undertaken.

114 Sanctions have also indirectly resulted in the relocation of the World Health Organisation’s (WHO) regional offices to Congo Brazzaville, accompanied by retrenchment of Zimbabweans formerly employed by WHO.

115 The Kaiser Networks’ Daily Reports of 28th November 2004 and AFP News Agency reported that Zimbabwe’s grant application for funding for its HIV/AIDS programmes to the Global Fund was rejected on political grounds.

116 Three quarters of the equipment in hospitals in the City of Harare are not functional and this has had serious repercussions on the ordinary people.

117 In the backdrop of an already overburdened health delivery system, many Zimbabweans are finding it difficult to access affordable health facilities and drugs, particularly antiretrovirals for HIV/AIDS patients.

118 The City of Harare Health Department immensely benefited from the various Joint Research Projects previously undertaken with international stakeholders. These projects have since been terminated.

119 The Department used to benefit from such projects since it took over equipment used during researches after the completion of research projects.

Global Fund

120 Zimbabwe has taken years of begging, kneeling and sweating for gaining access to the Global Fund to fight Malaria, TB, and HIV/AIDS.

121 Global Fund is one of the biggest organisations in the world that provides funds to poor countries to fight Malaria, TB and HIV/AIDS. Since the establishment of the Global Fund in 2002, Zimbabwe unsuccessfully applied funds to scale up its HIV prevention programs.

122 After a two year delay, the Global Fund approved a two year grant worth US$10.3 million in April 2005. Zimbabwe’s applications for grants for HIV/Aids programs were rejected for unspecified reasons. Consequently Zimbabwe was unable to expand and roll out antiretroviral drug distribution programs to rural areas.

123 The Global Fund also approved a US$ 65.2 million grant for Zimbabwe under Round 5 of its program in December 2006. Under the fund, the National Aids Council received US$32.7 million for HIV/AIDS the Zimbabwe Association of Church Hospitals got US$3.19 million for HIV/AIDS and TB while the Ministry of Health received US$9.23 million and US$20.12 million for TB and Malaria respectively.

124 Zimbabwe’s application for funds under Round 6 of the Global Fund was, however rejected in December 2006. The same fate faced the country under Round 7.

125 Zimbabwe remains sidelined by other donor initiatives such as World Bank MAP initiative, and US President’s HIV/AIDS initiative.

Child Welfare

126 The Child Supplementary Feeding Programme was initiated in October 1995. The program was valued at Sek 10 million (US$ 1.25 million) and was completed in 1996.

127 The project was aimed at providing nutrition and health education for children under 5 years and strengthening preparedness for future droughts. Although the Swedish government is still supporting the programme; funds for its Humanitarian Aid are now being channeled through Non-Governmental Organisations.

Regional Cooperation

128 Sanctions are affecting the smooth running of regional groupings such as SADC and COMESA.

129 The European Union through the European Development Fund compensates COMESA member states for revenue losses suffered under the tariff phase down exercise under specific conditions which take into account macroeconomic policies and governance issues.

130 Zimbabwe has not benefited from the fund and this could affect, in the long term, its tariff reduction process in line with other countries in COMESA, thereby undermining regional integration initiatives.

African Growth and Opportunity Act (2000)

131 In 2000, the US enacted a new law called the African Growth and Opportunity Act, (AGOA). AGOA offers tangible incentives for African countries to open their economies, build free markets.

132 Those countries that adopt free market principles and are perceived to adhere to the rule of law and respect human rights are, therefore, eligible under AGOA, to export a wide range of goods to the United States duty free.

133 In a single year, the African Growth and Opportunity Act led to an increase in exports from Africa to the United States by more than 1,000 percent, generating nearly $1 billion in investment, and creating thousands of jobs.

134 This increase in trade included a diverse list of products, among them apparel, cut flowers, and processed agricultural goods.

135 Thirty-seven African nations have met the AGOA criteria and are eligible for the trade incentives.

136 Zimbabwe does not enjoy any preferential trade under AGOA because of the sanctions imposed on the country by the USA.


137 As Monetary Authorities, we call upon all Zimbabweans across all social and political divide, from the youth, the clergy, civic organisations, the business community, labour, political parties and other interested groups to rise above party politics and speak with one voice.

138 Significant benefits accrue to the nation at large when all interested groups speaking with one voice and these include:

i. Minimization of internal brawls that divert attention fro
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