BY STAFF REPORTER
AN international non-profit organisation Pact says Zimbabwe’s bad governance has created conditions for illicit financial flows (IFFs) to the country which is isolated from international financial systems.
In a September report titled Infamous by Design: Illicit Finance in Zimbabwe, Pact states that the government even admitted that the most recent recession in 2019–2020 was in part brought on by its “missteps” in implementing austerity policies.
“Zimbabwe has experienced a decline in economic output in one out of every two years since 2000, mainly as a consequence of decisions made by the country’s leadership. The ubiquity of illicit finance in Zimbabwe reflects both institutional weaknesses and the reality that the current political order relies on the movement of dirty money to bind and stabilise relationships between power-holders,” .
the report said
“Certain features of the country’s political culture and economy have created the conditions necessary for illicit finance to thrive and continuously present actors with opportunities, incentives, and even imperatives to engage in illicit financial activity,”
“Though they aim to incentivize foreign direct investment and prevent capital flight, Zimbabwe’s monetary policies and stringent capital controls have had the opposite effect.”
the report said
In reaction Zimbabwe Coalition on Debt and Development programmes manager John Maketo said:
“This is not far from the fact. IFFs are a manifestation of bad governance that is characterised by corruption, disregard for rule of law, systemic breakdown and institutional failure. In such a scenario, IFFs will obviously thrive with no restraint. The porousness of our borders and opaqueness of trade and financial systems adds oil to the fire.”
said John Maketo
Transparency International Zimbabwe (TIZ) executive director Tafadzwa Chikumbu concurred with Pact’s findings saying IFFs thrive where there is lack of transparency and accountability.
“These are signs of poor governance. It also thrives where there are legal and institutional gaps,”
he said.
The Zimbabwe Women Against Corruption Trust Director Sandara Matendere said corruption is closely linked to bad governance.
“The challenge is that the corruption has become so systemic and sophisticated. It’s more of organised criminal activities which involves a network up to the border control officials who are responsible for monitoring externalisation of funds,”
she said.
Pact has worked in Zimbabwe for more than 20 years,alongside civil society partners in
support of a more-democratic society.
