Mugabe Destroyed Zimbabwe’s Property Rights

It’s true that Robert Mugabe’s drive for a one-party state, his brutality and deep corruption were a significant part of Zimbabwe’s economic collapse. But the signature blow that brought Zimbabwe’s economy crashing down was the abandonment of property rights in 2000.

Craig J. Richardson.

"Regarding Jason L. Riley’s otherwise excellent “A Too-Comfortable End for Robert Mugabe” (Upward Mobility, Sept. 11): It’s true that Robert Mugabe ’s drive for a one-party state, his brutality and deep corruption were a significant part of Zimbabwe’s economic collapse. But the signature blow that brought Zimbabwe’s economy crashing down was the abandonment of property rights in 2000, which had previously been enshrined in its constitution.

Whatever Mugabe’s faults, his new government in 1980 gave most white commercial farmers a “certificate of no present interest” when his party came to power, meaning they would be free to hold on to their land or sell it to the government at the going market price. Both white and black commercial farmers enjoyed access to bank lending for capital equipment using their land as collateral, making them among the most productive in the world. Mugabe’s government nationalized farmland in July 2000, seizing commercial farms without compensation, ignoring Zimbabwe’s constitution. A disastrous domino effect then ensued. Without a property title serving as collateral, banks refused to lend to the new farmers and lost millions on existing mortgages. Zimbabwean companies that relied on the commercial farms’ output, such as textile companies, also went bankrupt. Foreign investors fled and new investors stayed away despite the country’s prodigious wealth in mineral resources. Disastrous hyperinflation, spiraling government deficits, continued reliance on food aid (never a problem before 2000) would define Zimbabwe’s unfortunate turn away from free markets, stable currency and secure property rights.

Economies can often survive corruption, price distortions, inflation and brutality, but they cannot survive the destruction of property rights and the resulting breach of trust."

Prof. Craig J. Richardson
Winston-Salem State University
Winston-Salem, N.C."