2. Overview of Zimbabwe economy: 1980 – 2010 In 1980, Zimbabwe was the most industrialized nation in sub Saharan Africa apart from South Africa, but between 1991 and 1995, Zimbabwe’s industrial production shrank by 21%.20 ESAP policies did not result in the growth government expected: nor did its successor, ZIMPREST. Additionally, during the 1990s, Zimbabwe moved steadily from producing goods with a high level of technical input, to producing a greater proportion of primary products that were labour‐intensive. Food, beverages and tobacco grew to represent a greater portion of GDP while textile and chemical industrial outputs declined.21 In the late 1990s and post 2000, there were several severe knocks to the Zimbabwe economy, including the war in the Democratic Republic of Congo, unbudgeted war veteran payouts, and then wide‐spread farm invasions in the wake of the 2000 elections. Commercial farming employed 400,000 labourers, the vast majority of whom lost their jobs as a result of the invasions. As commercial agricultural production shrunk, so did the entire national economy – industries in Zimbabwe source more than 60% of their inputs from commercial agricultural production, and sell 50% of their products back to agriculture.22 All these factors have resulted in dramatic deindustrialization of Zimbabwe, particularly Bulawayo, and a responding growth of the informal sector. However, in 2005 the informal sector itself became the target of government action, with the infamous Operation Murambatsvina (OM). In the space of two months, government forces destroyed informal settlements and vending markets nationwide. This displaced an estimated 500,000 people, with direct and indirect knock‐on effects for millions more. Hundreds of thousands of families were plunged into poverty, and the devastating effects of OM on people’s lives continue to date.23 Nor did OM reverse the growth of the informal sector: it simply made life more difficult and treacherous for the millions struggling to survive by vending and cross border trading. As political tensions heightened between 2005 and the end of 2008, government policies further exacerbated the viability of businesses, with unreasonable and punitive price controls, multiple exchange control levels which disadvantaged exporters, and profligate printing of money. The resulting hyperinflation combined with price controls, resulted in empty shelves nationwide. Hundreds of businesses folded during the years leading up to the GPA. Currently, otherwise efficiently run and productive companies are struggling financially as a result of the “forced borrowing” of their capital by the Reserve Bank of Zimbabwe, which in 2008 literally seized foreign exchange from business accounts. Other losses were accrued in February 2009, during the process of US dollarization, which overnight left companies with empty Zimbabwe dollar bank accounts that had been worth millions in real currency terms. None of this money has been repaid by the State. Companies were forced by hyperinflation and government policy in the 2000s to accrue debt to stay afloat, which they now find 20 ZIMCODD: “Deindustrialisation of Bulawayo: a contribution to the debate”: August 2011. 21 Ibid page 5. It is not the intention of this report to fully unpack the broader contexts of these shifts. 22 Ibid. 23 SPT: “A fractured nation: Operation Murambatsvina 5 years on”: 30 July 2010. 14