close‐to‐impossible to service. As the Ministry of Finance appears not to trust the
Reserve Bank with funds, all government‐to‐government funds are currently being
channelled via the private banks to industry and commerce. These private banks are
charging iniquitous rates to access the loan facilities. It can cost up to 40% per
annum to borrow money in Zimbabwe, compared to 3% interest in many other
countries around the world.
In 2011, and in spite of the modest economic growth since 2009, government
remains the biggest formal employer in the nation, with most Zimbabweans still
having to seek income from the informal sector. Civil servants continue to earn
salaries that are below a living wage24, and use most of this to pay for rent, basic food
and services. Tragically, businesses continue to close or run at below capacity.
3.
Bulawayo and deindustrialization
Bulawayo has been the most severely affected city with regard to deindustrialization.
Since the early 1900s, Bulawayo has been the industrial hub of Zimbabwe, being
strategically situated between South Africa, Botswana and Zambia. Home to the
National Railways of Zimbabwe, and close to Hwange coal sources, Bulawayo has
traditionally housed most of the large textile and clothing factories as well as
furniture, pharmaceutical, metal, electrical and heavy industries. At its height,
Bulawayo industries alone contributed 25% to the GDP ‐ yet nationwide, industries
now contribute around 15% to the drastically reduced GDP.25
According to the Association of Bulawayo Businesses (ABUZ) more than 20,000 jobs
were lost in Bulawayo between February 2009 and February 2011.26 At least 85
firms and industries have closed down during that time span, including several of the
city’s major employers, while several others have relocated to Harare, citing
difficulties with sourcing agricultural and other inputs in Bulawayo, as well as lack of
Bulawayo markets for finished goods. Factories stand empty, and vacant shop fronts
are replacing functioning businesses in the shopping malls and in Bulawayo city
centre. The recent invasions of some properties, and threats of invasions made to
other businesses, have added to the sense of economic insecurity and depression in
the city.27 The knock‐on effect of these job losses for the well‐being of the city as a
whole has been profound: there is scarcely a family that has not faced a redundancy
in the last two years, with its associated economic hardship. The loss of spending
power in the city has further negative consequences for surviving businesses. It is
not surprising that families in Bulawayo are three times more likely to be food
insecure than in Harare. The loss in revenue to the Bulawayo City Council caused by
business closures, which have reduced the property rates’ base, as well as failure of
retrenched families to pay for services, has impacted negatively on the running of the
24 Most civil servants still earn below USD 300 per month, while the basic income needed for a family
to survive is USD 400 per month.
25 B Chitemba: ‘Byo revolving fund under scrutiny”, Zimbabwe Independent, 14‐20 Oct 2011.
26 Interview, Bulawayo, Sept 2011. See Appendix One for list of companies.
27 The Standard, “Police say they can’t stop Byo property grab”: 28Aug to 3 Sept 2011; Newsday, “Zanu
PF youths invade white‐owned buildings”, 19 Sept 2011, through to The Chronicle, “Police launch blitz
on illegal occupants”, 13 October 2011. Countrywide, there have been mixed messages as to whether
business invasions will be tolerated or not, and there have been waves of invasions going back to
2000.
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