November 5, 1981
Dear Mr. Chairman:
In accordance with the provisions of Section 720 of the International Security and Development Cooperation Act of 1980, I am submitting the following report on the internal situation in Zimbabwe.
Zimbabwe is well into its second year of independence, and in the period which has elapsed since the last report to the committees, the state of the nation can be described as basically stable politically. The disarmament and integration of the two former guerrilla groups continued on schedule and is expected to be completed in the very near future. This process represents one of this young nation's most significant achievements.
Prime Minister Mugabe's position within the government and within his party is still strong and his overall position in the country was enhanced by his skillful handling of the dismissal of former Minister of Manpower, Planning and Development, Edgar Tekere. While Mr. Mugabe is still lobbying for the creation of a one-party state, he has stated that he will not move in this direction without a popular mandate. The Prime Minister is also becoming a more prominent spokesman among Front Line leaders and within the OAU. Of obvious concern, however, is the increasing sensitivity Prime Minister Mugabe and other government officials are beginning to display over what they perceive as unfavorable press. The government recently fired the editor of the Umtali Post allegedly for questioning the military arrangement with the North Koreans.
In making public the government's decision to conclude a military agreement with North Korea, the Prime Minister stated that the brigade to be trained and equipped by the North Koreans would be used for internal security only. He also said that the acceptance of military assistance has no political or ideological significance so far as Zimbabwe's non-alignment policy goes, but rather this action, balancing British military aid, is an affirmation of that non-alignment.
Economically, Zimbabwe appears to be going through a period of defining what government's policy and role in the economic sphere should be. This could be a lengthy process, and it is already generating considerable concern in the private sector about its own role in the country's plans for economic development. Zimbabwe's economic policymakers remain very realistic, however, and, for the most part, seem inclined to approach structural changes in the economy with caution and gradualism, recognizing the importance of relating ideology to attainable goals.
The government has attempted to maintain a favorable investment climate. However, in keeping with its commitment to the implementation of socialist goals, the government wants the private sector to become more responsive to its development concerns as well as to Zimbabwe's overall development goals. The recent decision to create a minerals marketing authority to control the production and marketing of the country's minerals and metals no doubt represents an attempt to manifest these concerns.
Although the new budget reflects a moderately socialist path, it contains no references to drastic income redistribution programs or plans for nationalization of the private sector. Tax hikes called for in the budget are high by Zimbabwean standards; they are designed to increase government revenue and will have the added effect of allowing the government to increase expenditures in the fields of health services, schooling and other social programs.
While there is no question that Zimbabwe is continuing to make economic progress and that the economy is growing, the rate of growth is slowing somewhat and inflation is up for both high and low-income families. Key factors contributing to the economic slow-down include constraints in foreign exchange and labor and transportation problems. The emigration of whites is continuing, but there has been no significant increase or decrease in the numbers leaving.
There are also indications that recent tensions between South Africa and Zimbabwe may be having a negative impact on the economy. Also, the Zimbabwe Government has acknowledged that the country cannot cut off commercial relations with its neighbor. South Africa's decision to cancel the preferential trade agreement and to phase out Zimbabwean contract workers presently in the Republic will certainly aggravate an already difficult foreign exchange situation. The reclaiming by South Africa of 25 of its railroad locomotives is also causing serious transport problems for Zimbabwe, particularly with respect to the transport of petroleum products and to the movement of surplus grain from Zimbabwe's record maize harvest.
Land distribution is being carried out very cautiously and carefully, to insure that the basic infrastructure is either in place or under construction before settlement takes place. Present plans call for the resettlement of 18,000 families by the end of this year on presently unused land.
Sincerely,
RONALD REAGAN
Note: This is the text of identical letters addressed to Charles H. Percy, Chairman of the Senate Foreign Relations Committee, and Clement J. Zablocki, Chairman of the House Foreign Affairs Committee.