Of debt clearance and sanctions conundrum

Zimbabwe has been on a drive to come up with a solution to clear its foreign and domestic debt such that it begins to borrow again.

However, the talks hit a bump in the road as the United States of America decided to pull off from the talks saying the government failed to meet some agreements.

Questions had been asked about the commitment of the United States to these talks as there were minimum comments from the beginning by them. This week, I will also say I never trusted that the dialogue was going to get any backing from the United States as it would jeopardise the effects and impact of ‘targeted’ sanctions.

In the intricate dance of international relations, economic tools often serve as leverage for geopolitical objectives. The recent decision by the United States to withdraw from debt resolution talks with the African Development Bank (AfDB) regarding Zimbabwe raises crucial questions about the role of debt in achieving strategic goals.

US Chargé d’Affaires Ms Elaine French, cited concerns over Zimbabwe’s human rights record as a primary reason for the withdrawal, revealing the interconnected nature of economic and political strategies.

Sanctions have long been employed as a tool to influence regime change and debt resolution has emerged as a key component in navigating these turbulent waters.

The intersection of these dynamics in Zimbabwe provides a compelling case study, shedding light on the delicate balance between economic recovery, human rights considerations and geopolitical interests.

The linkage between debt and sanctions is not merely coincidental, it reflects a strategic approach to shaping the trajectory of a nation. The withdrawal from debt resolution talks by the US implies a re-evaluation of the leverage wielded through economic instruments.

Assumption is that a debt-free Zimbabwe would diminish the effectiveness of sanctions as a regime change tool, allowing the nation to rebuild its economy without external constraints.

One cannot overlook the broader implications of a debt-free Zimbabwe as financial independence from international financial institutions (IFIs) could mark a turning point for the country, unleashing a wave of economic opportunities.

The ability to borrow from IFIs can fuel infrastructure development, raising living standards and stimulating economic growth.

This potential positive trajectory presents a conundrum for those employing sanctions as a geopolitical strategy, as a thriving Zimbabwe might be less susceptible to external pressures.

As is known, the concept of sanctions as a regime change tool relies on economic distress to foment internal discontent, pushing a nation towards political transformation.

In the case of Zimbabwe, the interconnectedness of debt resolution and sanctions becomes apparent. A debt-free Zimbabwe would not only be better positioned to withstand the economic strain imposed by sanctions but could also reduce the efficacy of this tool altogether.

The primary question that arises is whether the international community should prioritise human rights concerns over economic recovery.

Striking a balance between holding nations accountable for human rights violations and fostering economic development is a delicate task.

The decision to disengage from debt resolution talks reflects a stance that leans towards emphasising human rights concerns, even at the potential cost of impeding economic progress.

However, it is crucial to consider the broader impact of a debt-free Zimbabwe on the African continent.

Economic stability in one nation can have a cascading effect, fostering regional growth and stability.

A thriving Zimbabwe could serve as a beacon of hope, demonstrating the transformative power of economic recovery, ultimately contributing to a more stable and prosperous region.

Beyond the geopolitical considerations, a debt-free Zimbabwe holds immense potential for its citizens.

Improved living standards, driven by sustained economic growth, can create a positive feedback loop, reinforcing social and political stability.

Infrastructure development funded through international borrowing can address critical needs, from healthcare to education, laying the foundation for a brighter future.

Moreover, a debt-free status enables Zimbabwe to explore new avenues for economic growth and diversification.

The nation could leverage its resources and human capital to become a key player in regional trade, fostering exports and contributing to the development of a robust African economy. This not only benefits Zimbabwe but also aligns with broader global goals of fostering inclusive economic development.

In conclusion, the withdrawal of the United States from debt resolution talks with the AfDB regarding Zimbabwe reflects the complex interplay between economic tools and geopolitical objectives. The decision suggests a prioritisation of human rights concerns over economic recovery, but it also raises questions about the effectiveness of sanctions in the absence of economic vulnerability.

A debt-free Zimbabwe has the potential to reshape the geopolitical landscape, challenging the assumption that sanctions alone can drive regime change.

The international community must carefully navigate these complexities, balancing the pursuit of justice with the imperative of fostering economic growth and stability in the region.

Tapiwanashe Mangwiro is a resident economist with the Business Weekly and writes this in his own capacity. @willoe_tee on twitter and Tapiwanashe Willoe Mangwiro on LinkedIn-ebusinessweekly