Why a nation is great? In fact how a nation becomes great?
A country which is free - politically, socially, culturally, economically for a consistent and enduring time is on its way to greatness.
A country whose spirit is shackled by short sighted policies of shorter people is definitely on high way to peril.
Zimbabwe is a perfect example of the sort of economic and political disaster that could destroy any country that pursues populist Marxism and the short sighted plugging of holes by policy makers to such an extreme.
The economy of Zimbabwe is collapsing no, it’s collapsed – reason Economic mismanagement.
Unemployment is 85% with highest rate of inflation close to 730,000%. This is the highest inflation for any country on Earth, the next highest being 60% for Iraq (due to war).
Conversion Rate: (http://www.oanda.com/convert/classic)
1 US Dollar = 593,964,860 Zimbabwe Dollar (six years ago it was 55 Z$)
1 Zimbabwe Dollar (ZWD) = 0.00000000 US Dollar (USD)
1 Indian Rupee = 14,036,748 Zimbabwe Dollar
1 Zimbabwe Dollar (ZWD) = 0.00000007 Indian Rupee (INR)
Zimbabwe’s currency is nearly worthless from hyperinflation; its financial institutions are in disarray; its world-class farms sit idle; and its manufacturing, mining, and export sectors are declining steeply.
A major reason for this state of affairs:
Earlier the farming sector in Zimbabwe was sophisticated and pretty much commercial.
Vast tracts of large-scale farms produced thousands of acres of tobacco, cotton, and other cash crops.
About 4,500 white families owned these farms.
In contrast, 0.8 million black farmers eked out a living on small and relatively infertile plots in the communal lands, producing maize, groundnuts, and other staples.
Contemporary History:
By the late 1990s, a broad consensus had taken shape–including the Mugabe government, the IMF, the United Nations, the British government (the original colonial power in Zimbabwe), Africa scholars, and even many of Zimbabwe’s white commercial farmers–that land reforms were needed.
The purpose of these reforms would be to improve agricultural productivity and, simultaneously, increase wealth for the black majority.
The sensitive issue was how to redistribute the land, since the commercial farming sector provided much of the country’s foreign exchange, created thousands of jobs, and produced the essential staple of maize.
What went wrong?
While the IMF and the British advocated that landowners be given adequate compensation, as dictated by Zimbabwe’s own laws, the Mugabe government argued that these lands had been “stolen” from the country’s black inhabitants and thus could simply be taken back.
This claim ignored the fact that more than 80 percent of white-owned commercial farms in Zimbabwe had been purchased through the commercial real estate market since Robert Mugabe came to power in 1980, and less than 5 percent of the farmers could trace their ancestry back to the original British colonialists who arrived in the 1890s.
The loss of Zimbabwe’s 4,000 farms has impacted every aspect of the country’s economy. Each of these farming companies employed 100 or more people, paid various taxes to the government, and generated incomes for others that also yielded taxes. In addition, the farms provided housing, clinics, and schools; more than a million Zimbabwean children, in fact, received an education from farm schools. Communal farmers also benefited from the farming companies, sourcing their demands for seed, fertilizer, chemicals, and expertise to them.
Reducing Inequality became the primary goal and function of the Mugabe government. Best and fastest way to achieve equality is to destroy wealth and Mugabe destroyed the very sector that was the economic driver of the country.
There are economic lessons from history, rather contemporary history.
Sources:
http://en.wikipedia.org/wiki/Economy_of_Zimbabwe
http://www.guardian.co.uk/world/2008/feb/22/zimbabwe
http://www.willisms.com/
http://www.zimbabwesituation.com/