COMMERCIAL FARMERS PESSIMISTIC RE: BOTH SHORT

C O N F I D E N T I A L SECTION 01 OF 02 HARARE 000939

SIPDIS

STATE FOR AF/S, AF/EX, HR/OE
NSC FOR SENIOR AFRICA DIRECTOR JFRAZER
TREASURY FOR ED BARBER AND C WILKINSON
USDOC FOR 2037 DIEMOND
NAIROBI FOR PFLAUMER
RIO FOR WEISSMAN
PRETORIA PASS AG ATTACHE HELM

E.O. 12958: DECL: 04/17/07
TAGS: EAGR ECON PGOV PHUM ZI
SUBJECT: COMMERCIAL FARMERS PESSIMISTIC RE: BOTH SHORT
AND LONG TERM PROSPECTS


CLASSIFIED BY ECONOFF K BEL FOR REASONS 1.5 (B) AND(D)


1. (C) Summary: DCM and Laboff met with three
representatives of the Commercial Farmers' Union (CMF)
- David Hasluck, Director, Malcolm Voles, Deputy
Director, and Colin Cloete, President, on April 11,

2002. The CFU had requested the meeting as a "reality
check" on the post-election situation of the
commercial farmers (CFs) in Zimbabwe. The CFs were
pessimistic regarding their ability to "sit out" the
situation in hopes of improved post-election
prospects. They were similarly dismissive of GOZ
projections that winter crops, grown with or without
the participation of the CFs, could yield enough to
meaningfully address Zimbabwe's critical food
shortfall. End summary.

Situation Regarding the Commercial Farmers (CFs)


2. (C) The CFU reps were very downbeat regarding the
GOZ land resettlement program. Although the farmers
had hoped for some easing of the situation post-
election, they have seen "more of the same" in the
form of farm occupations, acquisitions, and the
targeting of white commercial farmers. In fact, the
CFs have seen an increase in A-2 settlers (A-2 is the
GOZ's indigenous, small-scale commercial farmer
program) who receive entire farms rather than pared-
down sustenance plots. The CFU's assessment is that
white commercial farmers are no longer viewed by the
leadership as a key component of the Zimbabwean
economy, with attendant rights.


3. (C) The CFU does not believe that the majority of
its members will be able, on an economic basis, to
"sit it out" much longer. In addition to loss of
income and the shrinking value of any savings, the
farmers are facing their routine obligations - debt
payments, tuition payments, and living costs, the net
result being forced migration.

Future Economic Projections for CFs in Zimbabwe


4. (C) Of 4,500 paid members in the CFU prior to the
land acquisition scheme, the number has dwindled to
approximately 3,200 members - a decline of more than
one quarter. Further, about 50% of the remaining
farmers are having major operating or viability
problems. The CFU stated that this year had seen
approximately $250 million in forex income, of which
the producers were the main beneficiaries. This
amount is down from the $350 million which was
expected.


5. (C) When asked whether the CFs would be able to put
crops in next year if they "rode it out" for this
year, the CFU responded that there were both political
and social elements to the question. The CFs believe
that surviving for six to eight months without being
on the farm would be extremely difficult, noting that
the equipment and assets of the farms would certainly
be stolen/looted during the farmers' absence. They
noted as well that the figures coming out from the
Central Bank were increasingly unbelievable. They
feared that the economy would become de-monetized to
the point that people would refuse to accept money for
goods and services.


6. (C) The CFU complained that Agriculture Minister
Made's projections regarding the capacity of the
government to grow winter crops were outrageous. They
noted that Minister of State Security Goche, rather
than the Minister of Agriculture, was ostensibly in
control of this project. Although the government has
reportedly already placed an order for fertilizer for
the winter wheat crop, the official estimate of the
amount of wheat which could be grown was far out of
balance with reality. While the GOZ publicly stated
plans to plant 45,000 hectares of wheat by October
2002, the CFs believed the GOZ would barely be able to
sow 4,000 hectares. (UNDP projects a maximum
hectarage of 10,000, if all goes ideally.)


7. (C) Additionally, the GOZ did not even know who
would be growing the wheat. Most of the settlers -
and particularly the A-2 settlers - had little or no
farming experience. There had been some suggestion to
the CFs that they remain on their homestead and teach
the new settlers how to farm, a proposition which they
received with incredulity and disinterest.


8. (C) As far as the participation of CFs in the
winter growth cycle, they stated that while it might
be possible for them to plant 20,000 hectares,
yielding 120,000 tonnes, there were legal constraints
to contend with as well. For instance, the issue of
whether they would be allowed to remain on the farms
through harvest time is a key, but as yet unanswered,
question.

CFU Assistance


9. (C) When the CFs asked how they could assist the
mission, the DCM requested that they keep the Embassy
informed of the situation and new developments. In
addition, the CFs agreed to provide the names of A-2
settlers who were being allocated or grabbing large
chunks of CF assets. Further, the CFs agreed to keep
us informed of dialogue or approaches from the GOZ
that might point to normalization of the situation.


10. (C) Comment: Zimbabwe's white commercial farmers
are clearly at the end of their rope, and even their
previously affixed veneer of optimism about "riding it
out" is now cracking. An already destructive solution
is made worse by the Agriculture Minister's recent
statement that farmers are henceforth not allowed to
remove equipment - including irrigation systems,
farming tools, and tractors - from their farms.
Though such an edict is in clear violation of the law,
it reflects the GOZ's attitude that property rights
are no longer enjoyed by the commercial farmers. As
the realization of their fate becomes clear, more and
more will be forced to consider options elsewhere,
with varying but shrinking amounts of movable assets.
Zimbabwe's economic foundation is being dangerously
eroded as we watch, with parallel damage being
simultaneously inflicted on its civic foundation. End
comment.

Whitehead