Tuesday, March 19, 2013

An African success story?

One of the most influential think tanks in all the land is the Cato Institute in Washington, D.C.  One of the reasons is the high quality research their scholars consistently produce.  In this post I direct your attention to a report from Cato examining an interesting economic "success" story: the rapid growth of Zimbabwe's economy over the last 4 years or so.  At first glance, Zimbabwe's growth is puzzling: after all, how can its economy since 2009, grow at a 7% plus rate given that it is one of the world's most oppressive and economically backward countries?  And are the conditions that have given rise to it sustainable?  Alas, as Cato scholar Craig J. Richardson explains in the most recent version of Cato Institute's Policy Analysis, the reality is that this is not a success story after all.  Hear Richardson:
Zimbabwe’s recent growth rates do not accurately reflect its long-term economic prospects. Rather, they draw attention away from the country’s continuing pressing problems, including an inadequate food supply, poor governance, weakening property rights protection, and a bloated government sector. Those problems have been unwittingly enabled by Western governments and the IMF through massive cash infusions, which have given the Zimbabwean government little incentive to change.
This interesting and accessible article is well worth the read.  Find it here.