ZIMBABWE:It's hard to live and work in Robert Mugabe's beleaguered Zimbabwe, but the Irish community remains hopeful that change will come

THE IRISH abroad have proved a hardy bunch, as those living and working in Zimbabwe will attest. The local economy, starved of investment and shrinking for a decade under Robert Mugabe, is quickly reaching crisis point. Many say it is already there. However, for all the despondency over Mugabe's regime and the economic woes, many of the Irish residents believe the country's potential remains intact despite the turmoil.

After 28 years in power, Mugabe could be on the way out with his ZANU-PF party losing control of parliament in the March 29th election. A second-round run-off in the disputed presidential election will be held on June 27th. The leader of the opposition party, Movement for Democratic Chance (MDC), Morgan Tsvangirai won the first round, but not by enough to avoid the run-off. Although reliable reports say state-sponsored violence against suspected opposition supporters has been increasing, Tsvangirai still has a chance of winning.

But whatever the outcome, whether Zanu PF or MDC or one of national unity, post-election the state of the economy will be top of the agenda. In 2000, when the government began forcibly redistributing commercial farms owned by whites this resulted in the destruction of the country's agriculture industry, which had provided half of Zimbabwe's currency exchange.

Since then thousands of businesses have closed down, and 80 per cent of the population is officially unemployed, though many are involved in the "informal" business world.

Political strife, the world's highest inflation rate of more than 165,000 per cent - at the end of May the currency had passed 1 billion Zimbabwean dollars to €1.27 - and shortages of fuel and electricity, have made it virtually impossible to do business.

Despite the obstacles, a small band of Irish people have stuck it out. The community of around 1,500 can be found working in all sectors - and some still have their own businesses. There are also larger firms such as the Africa regional headquarters for construction firm John Sisk & Son in the capital Harare, and Lake Harvest - a fish farm run by Belfast man Gerry McCollum.

McCollum moved to Zimbabwe in 1997, after three years in Uganda. His company is situated on Lake Kariba - on the northeastern border with Zambia. Lake Harvest, which exports to the EU and southern Africa, employs 500 and has actually expanded in recent years.

He says he is not sure how it has managed to pull through. "You are firefighting all the time, I don't know how you do it, you just try to spend as little as you can, and earn as much as you can," he says. "It's very difficult as you are always working in real time - there is no quoting or coming back to things." However, he says that, given the proper circumstances, such as a liberalised economy, the country is ripe for investment.

The population is highly educated and work very well, and there are resources such as water, arable land, an excellent climate and the country's infrastructure is still of good quality, he says.

Asked if he believes the country can free itself from its current political situation, he says he is not sure, though he is hopeful that, post-election, a more liberal economy would come about.

Another Irishman keeping the show on the road is Garrett Killilea, a Limerick native, who once employed 80 people at his Harare civil engineering firm - Lamont Engineering. His employee base has now shrunk to eight.

Killilea, who is also the honorary consul for the Irish Embassy in Zimbabwe, says Lamont survives by taking on mainly mechanical and electrical engineering jobs - as the larger components are imported and bought in foreign currency. He says a job can take six months, so the fee will be based on final value - this is related to the consumer price index and the cost of importing the goods. It is not possible to price a job at tender, as it would have escalated so much when completed.

Neal Leach was born in Zambia and is married to Jenny, whose parents emigrated to Africa in the 1950s. She is president of the Matabeleland Irish Association in the southwestern city of Bulawayo, where only around 35-40 Irish remain. Their previous business was in irrigation, but Neal says that after land grabs closed the farms down, they diversified into video production. Asked how he has managed, he says it's not a country for the weak.

"The rate of inflation is killing us and prices can double every day. My personal benchmark for giving quotes is a litre of petrol. At the end figure out what that will cost in Zimbabwean dollars, or else quote in litres of petrol in US dollars or another commodity that holds its value."

He is cautiously upbeat on the potential for the country, and says the quality of the land is fantastic, though it's not being utilised at the moment. Also, while many factories have closed down, a strong infrastructure remains, as it was only in the past eight years that things got very bad.

John O'Sullivan, who moved to from Cork to Zimbabwe in 1982, works as a food processing consultant but says business has seriously fallen off and, like many others, he now sources more and more work in Mozambique and Zambia. "Ten years ago there was plenty of expansion in food manufacturing, but today the inflation rates make the decision to invest impossible." Although he is confident of better times ahead, he is not sure when they will come, and says the country cannot pull itself out of its troubles without outside help.

O'Sullivan is married to a Zimbabwean and has three children, but says that a lot of Irish have left, and from the middle of last year things got exceptionally difficult.

Another Irish consultant living in Zimbabwe is Michael Connolly, from Mullingar. He has spent 13 years in the country and 25 years in Africa, and works as an agriculture consultant mainly in neighbouring countries for the World Bank, the EU and Britain's Department for International Development (DFID). Until 2002 he spent seven years as an adviser to Zimbabwe's Ministry of Lands and Agriculture.

He says there has been a chronic deterioration of services - with interruptions to power, phones and internet making it hard to do business - but in truth the people are very patient.

So, the feeling seems to be of tempered hope on the ground of a new economic and political climate. Regardless of the election outcome, the economy needs to be quickly tackled. But has too much damage been done to what was once southern Africa's second biggest economy? Economists are suggesting that if the currency can be corrected, it will be possible for the economy to be turned around relatively quickly, and the International Monetary Fund (IMF) work suggests hyperinflation can be brought under control in a year.

But the IMF is also warning that far-reaching recovery will be slow, because attracting back professionals, getting agriculture back to work and restoring normal relations with the international community could take years.

Konrad Reuss, managing director for sub-Saharan Africa at rating agency Standard and Poor's, says looking at similar situations in other countries, an eventual turn-around is possible. But it would require very tight fiscal policies to get the public finances on a sound footing, and to arrest hyperinflation. He cites Bulgaria as a role model, as a strict recovery programme in 1997 curbed inflation of 1,082 per cent back down to single digits two years later.

A legitimate change of regime in Zimbabwe is likely to generate international goodwill and immediate financial support, and Reuss, looking at similar situations elsewhere, believes there are plans in place. "I believe that the World Bank and the IMF would be on standby to assist, and the international community would provide immediate aid support to put the country back on track."

He says the Zimbabwean economy used to have a diverse economy, unlike some other African countries which rely on specific commodities such as copper or oil and gas.

Roelof Horne, portfolio manager for frontier markets at Investec Asset Management, agrees and says that the country is not by its nature or culture an unstable place, and with the right change in political leadership it could be ripe for investment. Despite a rebuilding stage that could take years, he says there are opportunities there for Irish investors to enter into joint ventures with locals, start their own business or just simply put up the capital.He says the first step is to get rid of inflation, price controls and other rules and prohibitions stopping market forces from acting normally.

Secondly, external help will be needed and the budget deficit must be funded by external agencies, if there is a proper political outcome, and then the private sector must be given free rein. Horne says he is very impressed with the business people who kept going, and is certain quality management and entrepreneurship is there, though capital is needed. "Any businessperson who has survived the past five years is really good - they will be brilliant when circumstances are easier and I have the utmost respect for them."