Commerce without morality ... media reactions to the war on prices: as usual, Zimbabwe's media (both private and state-owned) have been vociferous in their support or criticism of the war against inordinate price increases. Here is a sample of the media reactions.

"Business gave a hostage to fortune". By Joram Nyathi, Columnist, Zimbabwe Independent, (private weekly), 13 July.

[ILLUSTRATION OMITTED]

It was the same in business, the media and the opposition. The response to the government's crackdown on business for hiking prices of basic foodstuffs last week was notoriously familiar: 'Hang Mugabe!' The results were equally predictable: Empty shelves and a burgeoning black market. [New African note: In fact, "empty shelves" is a wrong description as all other shelves are full except the shelves for bread, meat, salt, and other basic items which were affected by panic buying when the prices came down].

Nobody was bothered that the galloping prices were themselves stoking inflation faster than the government spending and the printing of money by the Reserve Bank. Nobody in the media bothered to ask the all-important question why business was suddenly in this frenzied bout to increase prices, all as if acting in concert.

On 1 June, the government, labour and business signed the protocol on price stabilisation. The social partners agreed to act in good faith and create a conducive business environment.

The government would cut expenditure, business would maximise productivity and make reasonable profit margins, while labour would exercise restraint in its wage demands. Prophets of doom were already at the altar telling us the social contract would not work before they had even read it. The government later raised the non-taxable benefit without forcing companies to increase workers' wages. It has resisted calls for a supplementary budget, which [some] believe is long overdue.

Business' response was a price madness without precedent in Zimbabwe. In two weeks, prices of some basic goods went up four-fold, wiping out overnight the tax benefit I hadn't yet received.

Those in the know told you prices were being pegged to the black market exchange rate of the US dollar. The major fuel of the price spree was the so-called "replacement cost" of stocks. It was as if everyone wanted to be counted as having contributed a sterling effort to the attainment of 1,500,000% inflation by year-end. How much of this "replacement cost" went into the pocket of the tolling worker?

The government might have over-reacted in reversing all prices to 18 June levels. The cut in prices of 50% is irrational and, therefore, unsustainable. But that doesn't take away the fact that business gave a hostage to fortune. Any government would have responded.

Zanu PF is making political capital which may force some companies to close down and hurt the poor more. But business was putting the same basic commodities that are now in short supply beyond any reach. Whether they were available in the supermarkets, I was still denied their enjoyment because somebody felt they couldn't forego a huge profit margin for the sake of the social contract. The ZNCC [Zimbabwe National Chamber of Commerce] president, Mara Hativagone, admitted as much.

Nobody doubts the cost of foreign currency. Nobody doubts the detrimental effects of price distortions on the market. Indeed nobody questions the government's culpability in the entire economic mess.

Unfortunately, that doesn't diminish the failure of business to act with circumspection and in good faith. They knew the rate of inflation at the time of signing the social contract on 1 June. They also knew that the social contract would not flood the country with foreign currency overnight.

[ILLUSTRATION OMITTED]

Speaking in a radio programme soon after the contract was signed, Callisto Jokonya, president of the Confederation of Zimbabwe Industries, said with commitment from all partners, economic recovery was possible within three months. So what caused the price panic so soon after the signing?

To me, the social contract was never given a chance purely for political reasons, not because it was futile. We have grown to prefer foreign intervention ahead of local initiatives. In any case, what is the value of business operations which our businessmen risk losing relative to the profit margins they could have foregone to meet their side of the bargain?

For opposition parties, the price escalations were celebration time. They served three purposes:

* As a demonstration of Zanu PF failure to run the country.

* Exposed Zanu PF's failure to manage the economy.

* That the opposition was indispensable in the economic recovery.

None showed any sympathy for the starving worker. All waited breathlessly for food riots and chaos that would force Mugabe out. I was left wondering whether our nation still has a soul at all.

Nowhere was this soullessness more evident than in a labour-based party failing to balance the interests of business with those of workers. Nothing was said about the gap between wages and the PDL as prices skyrocketed.

At the end of the day, what has been exposed is the myopia of both the government and business. The government's harsh response has predictably left supermarkets empty. On the other hand, relentless price escalations were a classic timebomb. They were bound to lead to a more catastrophic end. A starving nation starring at well-stocked shops will likely be tempted to loot before any political considerations. This could lead to the destruction of property and even loss of lives.

[ILLUSTRATION OMITTED]

Nobody can deny the resentment among shop assistants as they are made to put fresh price mark-ups daily to goods they need for their families, but can't afford. Witness how they have been the first to provide incriminating evidence against their bosses to the price monitoring taskforce about hidden merchandise. It is what Mahatma Gandhi termed "commerce without morality".

Instead of trying to "fix" each other, isn't it time for sober reflection among the stakeholders in the national interest? There is a certain belligerence that is as futile as it is ill-conceived.

"Greed, a way of life in Zanu PF". Zimbabwe Independent (private weekly). Editorial comment, 13 July.

The image of President Mugabe addressing ruling party supporters last Friday must have made an impression on all who saw it. Here was the head of state inviting his followers to back governments campaign to dispossess business people who are victims of his own damaging economic policies. People were being asked to take the law into their own hands which they duly did.

A figleaf of legality was only placed over the shameful episode after this newspaper was told by prominent lawyers last week that enforced price reductions were illegal. "Which law are you talking about?", Mugabe asked. He referred to "extreme greediness" among the business community. "They want to get richer at the expense of the poor," he claimed.

These remarks would have been more accurately directed at his own supporters for whom greed has become a way of life. And the whole point about the law is that it should be obeyed by rulers as well as the ruled. But once again, we have the president choosing which laws he is going to respect and which he will ignore because "people are struggling".

They are struggling largely with the fallout from policies he has pursued in the teeth of advice from every economist in the country. Inflation is being fuelled by incontinent state expenditure, governments appetite for funds, a bloated administration that offers no value for money, and the absence of political will. Then there is the destruction of forex-generating revenue sources such as tobacco and horticulture, money spinners just a few years ago.

Meanwhile, the seizure of farms has reduced agricultural output by 60% and tourists have been scared off by scenes we witnessed last week at supermarket tills. So have investors. Nobody will invest in a country where the head of state threatens to seize factories because he needs to court popular support in the run-up to an election.

The current campaign against the business sector will be just as damaging as farm seizures and Operation Murambatsvina. Again we witness violence and looting of private property.

This is Mugabe's idea of helping the poor. On his watch, the economy, once the pride of Africa, has contracted annually since 2000. Per capital GDP has shrunk to levels not seen since the 1950s. By any standard, Zimbabweans are immeasurably poorer today than they were at independence in 1980.

This is a novel approach to helping the poor! More accurately, he is pauperising the nation. Now he wants to do to manufacturing what he did to commercial agriculture. And then he will offer himself to the country as indispensable

How indispensable is somebody who cannot stop ruining a once thriving economy? How indispensable is a leader who instead of calling for national dialogue and well-considered policies to tame inflation, provides no example of restraint in patterns of public spending and unleashes gangs of undisciplined youths to mete out punishment to business people who have struggled against the odds to remain in business; whose taxes and expenditure keeps tens of thousands in employment.

By crushing the business sector because he believes it to be in league with Anglo-American imperialists, Mugabe is destroying the nation's means of recovery.

"Where are the 'captains of industry? By Dr Tafataona P. Mahoso. Columnist, The Sunday Mail (state-owned weekly). 15 July.

Corporate managerialism is an ideology and a corporate version of the imperialist doctrine of "good governance". This means that corporate managerialism is not usually what it claims to be. Its aim is to bamboozle society so that society substitutes a corporate dictatorship for its hard-won democracy. Nothing proves this point better than the ongoing price war in Zimbabwe.

Lynn Mukonoweshuro, a Kingdom Financial Holdings director, was quoted by the Zimbabwe Independent of 13 July as making two critical observations: First, the current crop of "captains of industry" were too pessimistic and too cynical to prepare Zimbabwe's industry for its impending recovery, the same recovery which South African firms see and which make the South Africans treat the current challenges as opportunities beckoning them to stay put.

Second, because of their role as Rhodesian and neo-Rhodesian "prophets of doom" against their own economy, many of the current "captains of industry" were not grooming new and appropriate leaders to take over from them and to position Zimbabwean industry for the impending recovery.

The current price war has, therefore, revived a persistent national question, which we have asked many times, and in different ways: Are the so-called "captains of industry" in Zimbabwe real captains leading new teams of Zimbabwean industrialists, or are they a bunch of isolated, co-opted and compromised African individuals grafted on to the rump of a dying Rhodesian oligarchy sustained by foreign capital?

From listening to Zimbabweans talking about the business sector, the following expectations stand out as things which should characterise a truly Zimbabwean business leadership:

A Zimbabwean business leadership would have had enough strategic business intelligence to recognise as a threat to them and their customers the draft of the so-called Zimbabwe Democracy and Economic Recovery Bill (now an Act passed by the US Congress and signed into law by President George Bush in December 2001) when it was being drafted here by white Rhodesians and the MDC in 2000.

A Zimbabwean business leadership would have quickly put together a private sector strategy to kill the sanctions bill before it became US law, and that strategy would have solicited the support of their US colleagues.

The Zimbabwe Democracy and Economic Recovery Act (ZIDERA) is not only racist and illegal, it is also anti-business. But we do not hear this from the Confederation of Zimbabwe Industries or from the Zimbabwe National Chamber of Commerce.

Even now, there would be no doubt among Zimbabwean citizens as well as politicians where the business leadership stood in relation to the US and UK sanctions, and what this leadership was doing to defeat the same sanctions. The absence of a collective business voice against ZIDERA is the most striking comment on business leadership in Zimbabwe.

The absence of such a collective strategy is again a sad and striking comment. Instead of speculating about inflation, instead of raising prices on the basis of speculative guesses, the business leaders would design a national plan to retain their businesses and customers by sharing both costs and profits with customers, meaning that they would opt to reduce profit margins in order to retain market share, consumer confidence, and shorten the "crisis".

[ILLUSTRATION OMITTED]

Unfortunately, the approach which the business leaders took was the exact opposite, guaranteed to stretch the crisis for as long as the government and its majority supporters refused to collapse.

Instead, almost all significant businesses guessed and calculated inflation only upwards, to the extent of even making ridiculous predictions that food would completely run out in March 2008. Yet common sense tells us that, even in a drought year, March is when fresh foods and new harvests become plentiful.

But a good journalist would not restrict his or her camera just to the emptied shelves. That is not the story. The story is the relationship between the fully stocked shelves and the cleared ones. A country in the depth of starvation will not have empty shelves for just mealie-meal, sugar, and Mazoe orange juice, while the shelves for Coca-Cola, Fanta, Lion Lager and Pilsener beers are full.

It will not have empty shelves for bread and buns while the cereals shelves are choked full. It will not have empty shelves for fresh milk while the cheese, yoghurt, and tinned milk shelves are full. This is the reason why the BBC, CNN, Al Jazeera and SABC cameras restrict themselves to the shelf while avoiding the rest of the store.

And the point is that it would be easy to expose and stop the practice if the Confederation of Zimbabwe Industries and the Zimbabwe National Chamber of Commerce had a strict code of ethics and discipline. But these business bodies do not seem to understand what the fake starvation stories say about them. That they are declaring monthly and annual profits over the bodies of women and children dying of starvation.

A truly Zimbabwean business community cannot afford to remain stuck in the vindictive bitterness of the Rhodesian rump. This is precisely why South African businesses in Zimbabwe have refused to buy the British and neo-Rhodesian pessimism about Zimbabwe which has been aimed to make them pull out.

But the South African companies are led by sharp business strategists who know that if they pull out, they will be replaced by Chinese, Indian, Iranian and even Russian companies.

Once Zimbabwean business leaders get over their neo-Rhodesian hatred and vindictiveness, they would not just refrain from collaborating with foreign spies to generate lies about the Zimbabwe economy.

They would forge a strategic plan to take advantage of the glaring contrast between the economic realities on the ground in Zimbabwe and lies being peddled by SW Africa Radio, The Zimbabwean and the thousands of foreign-sponsored hate channels which use internet sites against Zimbabwe. They often talk to relatives, colleagues and acquaintances about the huge gap between the propaganda and the real-life situation.

For example, on 11 July 2007, the British Airways crew had been told through the British media that upon their arrival in Zimbabwe, there would be no vehicles on the streets of Harare because the government had forced fuel dealers to sell fuel at an uneconomic price.

When they then drove from Harare International Airport to Miekles Hotel, they were amazed by the traffic jams on the streets of Harare and the types of vehicles involved--mostly new four-wheel vehicles, BMWs, Pajeros, Mercedes-Benzes and so on.

A similar situation prevailed in supermarkets. Only a few targeted items were missing from the shelves and it was not possible to blame scarcity for the empty shelves because the full shelves suggested a very rich economy awash with money and luxuries.

Several varieties of Russian vodka, for instance, were available in almost all the major supermarkets. So were Zimbabwean and South African wines, cereals, soaps, detergents, toiletries and perfumes.

If the so-called business community is serious about "turning around the economy", it should exploit these glaring contradictions and silence the detractors. It is not good for food chains to declare huge profits every year while a hostile foreign and a pro-opposition local media are telling the world through doctored horror pictures that Zimbabwe is worse than Darfur in Sudan.

The business community would be foolish to think that such propaganda hurts only Pesident Mugabe and Zanu PF. Yet they appear to think so.

Lynn Mukonoweshuro's criticism of the current crop of "captains of industry" suggests that what is at stake is not just the recovery of the economy of Zimbabwe. It is in the interest of both Rhodesian rump capital and Euro-American capital to pre-empt the emergence of a Zimbabwean business class and business leadership rooted in the values of the Third Chimurenga.

Such a class would not only enrich and prosper Zimbabwe, it would compete with neo-Rhodesian and Euro-American interests over the massive strategic resources of Zimbabwe. So the Rhodesians, the British, the North Americans and the Europeans are united in financing and promoting sellouts in Zimbabwean business as much as in Zimbabwean politics.

Those who doubt this should study the reasons behind Euro-American hostility towards the Russian president, Vladmir Putin. If we put Zimbabwe during and after the Economic Structural Adjustment Programme in the place of Russia from 1989 to date, we see similarities.

According to Prof Michel Chossudovsky: "The IMF-style shock treatment [of Russia] initiated in January 1992 strategically precluded from the outset, a transition towards national capitalism, that is, a national capitalist economy owned and controlled by a Russian entrepreneurial class and supported as in other major capitalist nations by the economic and social policies of the Russian state."

In other words, after 1989, the new enemy of the West in Russia was no longer socialism but the possibility of the emergence of a truly sovereign national capitalism. The same now applies to Zimbabwe. The West wants sellouts in our economy as much as in our politics.

"Digging its own grave". The Financial Gazette (private weekly). Editorial comment. 5 July. It will be interesting to see how government apologists will sanitise the trail of destruction being caused by their paymasters, who, wittingly or unwittingly, have gone all out to suffocate the very foundation of business--profit.

Cheap political points are being scored at a huge cost to the nation as it is becoming difficult for the majority poor to source basics, which have disappeared from supermarket shelves only to emerge at a premium on the illegal parallel market.

Save for willing tools--Baffour Ankomah of New African magazine and the London-based Nyekorach Matsanga who are only credible in the eyes of their handlers--no serious marketer would have the temerity to defend the ongoing crackdown on businesses.

The approach, style and form all have the marks of yet another ploy to seize assets from targeted business people under the guise of the Zimbabwe State Trading Corporation. The governments shortcomings in restoring normalcy to Kondozi and other farms wrested from former white commercial farmers make us doubt its sincerity and abilities.

With its back against the wall, it has already chewed more than it can swallow, and needs all the support it can muster to wriggle out of the mess, which is of its own making. We fear that the powers that be are digging their own grave. They can brighten their chances for a successful rescue mission, the SADC initiative included, by stopping the digging forthwith and cry out for help. But again, expecting a wounded buffalo to act reasonably is an illusion.

"Harare is safer than Johannesburg". By Dzika Danha, Analyst, Renaissance Capital, Harare. Interviewed by the South African-based Money Web. 9 July.

The immediate impact [of the crackdown on prices] has been a reduction of goods on the shelves. I think we will really feel it in a big way in probably a couple of weeks, because the government is very heavy-handed about trying to enforce it. So I think they are just going to try and get rid of their stock while they can, but the problem is down the line--manufacturers are already short of slowing down production.

Question: And what are you doing with your family? Are you keeping them indoors or are you quite happy for your kids to walk to school and your wife to perhaps shop if there is a place to shop?

Dzika Danha: I'm not married, unfortunately. But look, physically it's safe. There's nothing really wrong. I mean, that's a gross misconception that people have about Zimbabwe. It's actually a very safe place, even now. It's just an economic thing which is the real story here. It's the ordinary person trying to struggle to make a living. In terms of safety, crime-wise, it's a lot safer than, let's say, Jo'burg.