By Imraan Buccus
"Debt” Thomas Sankara famously argued at the Organisation of African Unity (OAU) in Addis Ababa on 29 July 1987 “is a cleverly managed reconquest of Africa."
The history of the misuse of debt as a form of political control goes back more than two centuries. Haiti, the first independent Black republic in the modern world, was coerced into paying reparations to France for its own freedom, won in 1804 after more than a decade of war against slavery.
This imposed debt, totalling an estimated $21 billion in today’s terms, crippled Haiti’s economy for over a century. The injustice of this arrangement was not only in its moral absurdity but also in its economic implications, which locked Haiti into cycles of poverty and dependency.
More recently the Structural Adjustment Programs (SAPs) implemented across Africa during the 1980s and 1990s by the International Monetary Fund (IMF) and the World Bank devastated many countries.
These programmes were framed as necessary measures to stabilise economies, reduce debt, and promote development through liberalisation and integration into the global economy. However SAPs represented a form of neo-colonial control that seized control of large areas of policy formulation and prioritised the interests of global financial institutions and Western powers over the well-being of African populations.
SAPs imposed severe austerity measures, including cuts to public spending on essential services such as healthcare, education, and social welfare.
They also mandated the privatisation of state-owned enterprises, the removal of trade barriers, and the liberalisation of financial markets. While these measures were justified as promoting efficiency and growth, they had devastating consequences for the majority of people.
SAPs led to widespread poverty, unemployment, and inequality.
The dismantling of state support systems meant that millions of Africans lost access to basic services. Farmers, who were often forced to compete with subsidised agricultural products from the Global North, found their livelihoods destroyed.
In urban areas, the removal of subsidies on food and fuel led to skyrocketing prices, sparking protests and uprisings across the continent. Women, who often bore the brunt of caring for families and communities, were disproportionately affected by the social and economic dislocation caused by SAPs.
The emphasis on export-oriented growth and the repayment of external debt trapped many African countries in cycles of dependency.
Rather than investing in local development, governments were compelled to prioritise debt servicing, often at the expense of their own populations. This perpetuated a form of economic subjugation that mirrored the extractive relationships of colonial rule.
Zimbabwe’s descent into economic turmoil began in earnest with the implementation of the Economic Structural Adjustment Program (ESAP) in 1991. Mandated by the International Monetary Fund (IMF) and the World Bank, ESAP was presented as a pathway to liberalise the economy, attract foreign investment, and stimulate growth.
However, the programme came with severe austerity measures, including cuts to public spending, removal of subsidies, and the deregulation of industries.
The immediate impacts of ESAP were devastating. Healthcare and education, two pillars of Zimbabwe’s post-independence achievements, suffered severe funding cuts. Public sector retrenchments led to widespread unemployment, while the removal of subsidies on basic goods made life unaffordable for the majority.
The promise of economic growth never materialised, and instead, Zimbabwe became increasingly reliant on external loans to service its growing debt. By the late 1990s, the structural adjustment program had left the economy weakened and the population in a state of profound distress.
As Zimbabwe grappled with the fallout of structural adjustment, its political landscape became increasingly fraught.
In 2000 ordinary Zimbabweans, desperate for land, began occupying white owned commercial farms. Seeking to sustain its collapsing legitimacy the Zanu-PF government sought to take over the process of land reform initially driven from below.
In response, the United States and the European Union imposed sanctions on Zimbabwe. The Zimbabwe Democracy and Economic Recovery Act (ZDERA) of 2001, enacted by the US, imposed a clandestine embargo on Zimbabwe.
It officially made it US policy to block Zimbabwe’s access to loans and investment from international financial institutions, such as the IMF and the World Bank. Senior US officials, who hold influential positions in many multilateral institutions, were prohibited under ZDERA from voting to support Zimbabwe’s financial needs.
This legislation has not only entrenched Zimbabwe’s economic isolation but also created significant barriers to recovery, further impoverishing an already struggling population.
UN human rights experts argued that the “human rights of ordinary Zimbabweans suffer greatly from the consequences of sanctions,” and that “sanctions and various forms of over-compliance with sanctions have had an insidious ripple effect on the economy … and on the enjoyment of fundamental human rights.”
These findings underscore how punitive economic measures often harm the most vulnerable populations rather than achieving their stated political objectives.
The prohibition of debt relief and loans placed Zimbabwe in an economic stranglehold. Without access to international credit, the government struggled to finance development projects or stabilise the economy.
Hyperinflation, which reached its peak in 2008, wiped out savings and plunged millions into poverty.
Zanu-PF is authoritarian and corrupt but while mainstream Western narratives blame Zimbabwe’s leadership for the crisis, the role of sanctions in deepening the country’s economic collapse is seldom acknowledged.
In 2023, President Biden removed Zimbabwe-specific sanctions under the Treasury program. However ZDERA remains in force, blocking debt relief and restricting Zimbabwe’s access to loans from international financial institutions. Experts estimate that banks lose about $1bn annually in higher bank charges because of ZDERA.
The lifting of ZDERA and the provision of debt relief are critical steps toward economic recovery. If former white land owners are to be compensated for the expropriation of their farms that money must come from the coffers of the United Kingdom which never made good on its promises to fund reform.
In July 2020, a “compensation deal” was signed in Zimbabwe offering $3.5 billion to roughly 4,000 white former landowners for property expropriated in the land reform process of the early 2000s. This agreement was presented as an effort to mend relations with Western powers and restore Zimbabwe’s access to international financial markets.
Zimbabwe continues to grapple with extreme poverty, manifesting in widespread unemployment, chronic hunger, and inadequate income for the majority of its population.
Unemployment is endemic. In 2019 the World Bank reported that as of 2019, 39.8% of Zimbabweans lived below the international poverty line of $2.15 per day, with 85% falling below the upper middle-income poverty line of $6.85 per day.
Food insecurity is also an acute problem. In December last year, the U.N. World Food Programme warned of an impending dry season that could exacerbate hunger for millions already affected by drought. This dire situation has created a cycle of deprivation, deepening inequality and undermining the potential for long-term economic recovery.
Huge numbers of people have had to leave the country to find livelihoods, with South African and the United Kingdom gaining many well educated people.
Now, Zimbabwe’s government faces a dire ultimatum. US restrictions will not be removed unless the government fulfils its pledge to pay the $3.5 billion to white farmers who profited from colonial rule and post-independence land ownership patterns.
These billions, amounting to nearly half of Zimbabwe’s annual revenue, are unattainable for a nation already teetering on economic collapse.
At a time when Zimbabwe is ranked among the four most food-insecure countries globally and on the brink of ‘man-made starvation’, this demand can only deepen the humanitarian crisis.
When Zimbabwe gained independence in 1980, the Lancaster House Agreement included a commitment from the United Kingdom to provide funding for land reform.
This was intended to facilitate a peaceful transition by compensating white farmers and redistributing land to the Black majority who had been dispossessed during colonial rule. However, this promise was not fully honoured.
While some initial funds were provided, they fell far short of what was needed to address the land issue comprehensively. By the late 1990s, the UK had withdrawn its financial support for land reform.
The demand for the Zimbabwean government to pay $3.5 billion to the former white farmers who lost land during the land reform process can only mean that the Zimbabwean people will be further impoverished and Zimbabwe’s institutions, which are already in crisis, further degraded. If the farmers are to be compensated that money must come from the United Kingdom.
Now that Donald Trump has turned on South Africa, citing possible land reform as well as South Africa’s position in support of Palestine, we must face the possibility that we may now also face the risk of being subject to sanctions.
A problem once faced by the people of countries such as Cuba, Venezuela and Zimbabwe could conceivable become a crisis for our people too. In this moment it is essential that, while sustaining our critiques of the corrupt and authoritarian regime in Harare, we stand with the Zimbabwean people.
** Dr Buccus is senior research associate at ASRI
** The views expressed here do not necessarily represent those of Independent Media or IOL