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The origins and development of secondary industry in Southern Rhodesia between 1890 and 1938 need to be outlined if the clamour and debate over local industry that emerged in the ensuing years of the Second World War are to be understood. While this gestation period of secondary industrial development has received considerable scholarly attention, this chapter discusses in particular the way in which the peripheral emergence of secondary industry amid opposition from mining and agricultural interests during the first forty-eight years of the colony reveals tensions in settler colonialism.
First, there were conflicts between local and national capital and international capital. Local capital, largely comprising rural owner-workers of small and medium-sized mines and farmers, formed the base of the capitalist sector and was committed to the economic development of the country. ‘This national character of the white rural bourgeoisie’, trenchantly explained Giovanni Arrighi,
distinguished Southern Rhodesia from practically all other African colonial territories north of the Limpopo and South of the Sahara, where exploitation of resources was carried out by large-scale international capitalism. In these other territories, where exploitation was based on large-scale mining or plantation or monopoly trade, capitalist interests in the economy were not permanent but lasted until, for example, deposits were exhausted or the raw material was substituted in the industrial process overseas or some more economic source of supply was found.
Second, there was also antagonism within the settler society itself, as reflected by the continuous conflicts among the various interest groups, notably miners, farmers, commerce, and industrialists. These intra-settler relations were crucial in shaping the Rhodesian economy and politics in general and industrial development in particular. Hence, ‘the path of capitalist development followed by Southern Rhodesia’, argued Arrighi, ‘is intelligible only if due attention is paid to divisions within settler society and between economic sectors’. The conversation over the overall economic trajectory of the colony was underpinned by these differing interests. This marked the beginning of the notion of societal corporatism, as the state and economic interest groups (whose cordiality was indispensable) negotiated, adopted, and implemented policies for the success of the colonial project. The following paragraphs discuss the early foundations of the Rhodesian economy, highlighting the competing views of the different economic sectors and the unfolding societal corporatism as agriculture, commerce, and mining received state recognition and thereby achieved monopoly over industrialists.
This chapter describes Southern Rhodesia’s continued post-war industrial expansion, the government’s industrial policy, and the consolidation of organised industry into a national association, the Federation of Rhodesian Industries (FRI), established in 1949. It then covers the FRI’s politics up to 1957, when it amalgamated with industrialists of the other two federal territories, Northern Rhodesia and Nyasaland. This consolidation occurred in the socio-economic and political environment that ‘birthed’ the Central African Federation (CAF) in 1953. The post-war environment and the establishment of the CAF were significant in shaping the relationship between the FRI and the state regarding government assistance to secondary industries. The FRI, like its predecessor, was persistent in its pursuit of a definitive industrial policy and government assistance through protective tariffs, among other factors of production. In doing so, it faced a reluctant, if not outright dismissive, state. This apparent arrogance of the state towards secondary industries triggered wide-ranging criticisms from the FRI. All of these dynamics form the core discussion in this chapter.
The chapter begins with an analysis of the impact of the post-war economic environment on the government’s industrial policy and industrial expansion. It then examines the consequent transfiguration of the organisational structure of secondary industry. Under the stimulus of continued industrial expansion and due to the desire to achieve more for the country in general and the sector in particular, a colony-wide association of industrialists, the FRI, was formed. The second section goes on to examine the nature, form, and effectiveness of state assistance for secondary industries and the various responses by industrialists thereto, and the last shows the size and the structure of secondary industries that emerged under the existing policy environment.
The chapter concludes that to achieve industrial expansion, industrialists received minimal state assistance and, in fact, largely persevered on their own. Despite the increasing importance of secondary industries to the country and the numerous pleas and proposals from the FRI, the state continued to be a reluctant partner. For instance, by 1957, almost all of industry’s requests were yet to be attended to or were completely dismissed by government; even when they did receive attention, it was not satisfactory. Yet, this did not inhibit industrial growth and expansion. In what follows, the discussion turns to how industrial growth and expansion were achieved, notwithstanding the reluctance of the state.
This book examines the relationships between organised secondary industry, the state, and other economic interest groups (farmers, miners, and commerce) during the industrialisation of Southern Rhodesia (colonial Zimbabwe) between 1890 and 1979. Using diverse and fresh archival material that includes minutes and reports of industrialists’ congresses, industrial journals, business newspapers, legislative debates, and government and commissions of enquiries’ reports, it demonstrates that this relationship was conflictual, uneven, and irregular, and often shifted depending on time and context. The book argues that the great expansion and diversification of industry which took place were attributable, among other factors, to the efforts of private entrepreneurs.
Industrialists galvanised and formed representative organisations, starting with the Salisbury and Bulawayo Manufacturers’ Association (c.1920), which then evolved into the Salisbury and Bulawayo Chambers of Industry (c.1930s), the Association of Chambers of Industries of Rhodesia (1941–1949), the Federation of Rhodesia Industries (1949–1957), the Association of Rhodesia and Nyasaland Industries (1957–1964), and the Association of Rhodesian Industries (1964–1979). These organisations engaged the state in pursuit of industrial development. Often, industrialist associations’ requests, demands, and suggestions were opposed, if not dismissed, by the government and other economic interest groups, and yet, remarkably, secondary industries expanded. By privileging the voice of industrialists which hitherto has been neglected in the historiography, the book moves beyond the existing scholarship’s emphasis on the actions of the state in the industrialisation of colonial Zimbabwe through planning, regulation, and establishment of major industries of national importance. While this existing analysis is correct, it is incomplete.
Between 1890 and 1965, farmers, miners, and commerce, with the state’s support, believed in the supremacy of the primary exporting industries of agriculture and mining in propelling the economy of Southern Rhodesia. As we will see, the state adopted the policy of ‘imperial preference’. It opened the colony for imports of manufactured goods from other parts of the British Empire in return for market opportunities for the primary products. This policy deliberately favoured the mining and agricultural sectors. It also sacrificed industrial interests in negotiating trade agreements, thus depriving the secondary industry of tariff protection. Further, the state routinely accepted advice which labelled the manufacturing sector as of secondary importance to mining and agriculture.
‘We must pay due respect and praise to those industrialists who started, with few resources and with very little prospects, the development of secondary industries. They not only faced active opposition in some directions, but they got very little cooperation from the general public, from the merchants or from the government – and very little from politicians. Even today, the position is not such that we can say that the general population, the government or the politicians are fully aware of the importance of the development of secondary industries.’
– J. H. Hendrick Smit, Southern Rhodesian Minister of Finance and Commerce, Address to the Rhodesian Jubilee Industrial Exhibition of the Bulawayo Chamber of Industries, 3 September 1940.
The outbreak of the Second World War in 1939 brought mixed fortunes for Southern Rhodesia. Whereas the colony previously relied largely on imports for manufactured goods, it now turned to local products because of the interruptions in international trade caused by the war. Imports became increasingly unavailable, inducing scarcity and high demand. Shortages stimulated calls for local industry to fill the vacuum. Consequently, an import substitution industrialisation (ISI) drive temporarily developed. However, this impact of the Second World War was not unique to Southern Rhodesia. It was also felt in some other parts of sub-Saharan Africa. The only exception to this was South Africa, which had a comparatively established secondary industry by the time the war broke out. Not all industrialisation was sparked off by the conditions of the war, however. For example, in British West Africa, Lord William M. Hailey had already recommended in 1938 that Britain allow her dependencies to develop local secondary industries. While these factors are acknowledged, the impact of the war stood out, as it accelerated industrial development.
At the same time, secondary industrial development in colonies such as Kenya and Southern Rhodesia was aided by the greater buying power of their White settler population. Southern Rhodesia had the crucial advantage of being a self-governing colony, a status that gave it some considerable control of the domestic economy. Southern Rhodesia under the Responsible Government was free to manipulate tariffs, something denied to every other colony. Shigeru Akita has observed a similar tendency in British India during the Great Depression, wherein a self-governing India took full advantage of her fiscal independence to promote her industries, which had the effect of elbowing out Britain’s efforts to dominate the Indian market.
Existing conventional wisdom on the Rhodesian economy during UDI posits that the state muzzled organised secondary industry, which became acquiescent. This assertion captures developments on the political front. However, this chapter shows that in the economic sphere, industrialists remained forceful in pursuit of their interests. They manipulated the state’s overreliance on the manufacturing sector to provide employment and consumer goods vis-à-vis sanctions. The chapter also revisits the accepted belief that UDI was the period of high import substitution industrialisation (ISI) and economic nationalism. In this vein, it examines the interaction between the state and industrialists over the administration and implementation of the import control policy and currency allocations – the two major economic instruments of the UDI regime. The chapter suggests that Tor Skålnes’s notion of societal corporatism – the changing role of interest groups and their relationship with the state, as well as their collaboration in a broader sense – may be a more useful way to understand the relationship between the ARnI and the state during this period.
In addition, the chapter analyses the numerous interactions between the state and industrialists over several challenges affecting the economy in general and the manufacturing sector in particular. Both the Rhodesian war of liberation and the constitutional negotiations with Britain attracted comments from the industrialists, and as such warrant examination. The chapter begins in 1966 with the imposition of sanctions by both Britain and the United Nations (UN), which necessitated the introduction of a new economic policy. It then moves on to examine the implementation of the economic policies, the challenges faced, and industry’s views on decolonisation and African majority rule. It ends in 1979, with a discussion on the nature, pattern, and structure of secondary industry that emerged during UDI.
UDI, Economic Policy, and State–Industry Relations
The UDI in November 1965 had huge economic and political consequences for Rhodesia. Following the White rebellion, Britain and the UN imposed economic sanctions on Rhodesia. The sanctions were applied piecemeal. Britain initially introduced financial sanctions from 12 November 1965 to 16 December 1966. British embargoes were also imposed on Rhodesian tobacco, sugar, and other products, and Rhodesia’s Commonwealth trading preferences were suspended, as was the country’s access to the London capital markets.
On 1 July 2016, the government of Zimbabwe gazetted Statutory Instrument 64 of 2016 (SI 64/2016), aimed at boosting domestic industrial production through the protection of local industries from unfair competition from foreign firms. However, Zimbabwe’s neighbours, in particular Zambia and South Africa, formally complained to the Southern African Development Community (SADC). They claimed that SI 64/2016 adversely affected their economies and violated the SADC Protocol on Trade, which promotes free trade among member countries. The two countries further argued that Zimbabwe’s introduction of the statutory instrument was unilateral and unprocedural because, for instance, ‘the Government of Zimbabwe was supposed to approach the SADC Committee of Ministers Responsible for Trade to justify its promulgation before implementation’. The rationale was that Zimbabwe, as a member of the World Trade Organization, the Common Market for Eastern and Southern Africa, Economic Partnership Agreements, and the SADC, was bound by the various trade agreements of these organisations and, therefore, had an obligation to adhere to their terms and conditions.
Around the same time, in 2016, the East African Community (EAC), comprising Rwanda, Kenya, Tanzania, Uganda, and Burundi, adopted a phased ban on the importation of used clothing over three years. Just like Zimbabwe, the EAC intended to protect its domestic textile industry because the second-hand clothing imports, estimated at roughly USD 151 million in 2015, stifled the local sector. The proposed ban alarmed the Secondary Materials and Recycled Textiles Association (SMART), an association of United States (US)-based used clothing exporters. They sought the intervention of the US Trade Representative (USTR). The USTR responded by evoking ‘an out-of-cycle review of AGOA privileges’, which would result in the revocation of ‘preferential market access’ for the EAC’s textile exports to the USA. Against the backdrop of this threat, within two years all EAC states except Rwanda had reversed their decision.
The two cases of Zimbabwe and the EAC brought to the fore the globalism, imperialism, inequality, and state–capital relations associated with African industrial policy as it strives to achieve meaningful industrialisation. Examining industrial policy is even timely, as the topic has also become resurgent after a lapse of almost three decades.
This chapter discusses the establishment of the Association of Rhodesian and Nyasaland Industries (ARNI) in 1957 as an organisation that could speak for industrialists throughout the Federation of Rhodesia and Nyasaland. It details the politics of the ARNI, especially the demands and aspirations of Southern Rhodesian industrialists as they interacted with territorial and federal governments as well as their Northern Rhodesian and Nyasaland counterparts vis-à-vis other economic interest groups. The formation of the ARNI happened in a fast-changing economic and political space in British Central Africa. The Federation suffered an economic recession from late 1956 following a fall in the price of copper, the linchpin of the federal economy, on the global market. From 1957, African nationalism in the Rhodesias and Nyasaland grew, resulting in frequent protests and states of emergency. In 1962, general elections in Southern Rhodesia brought in a new right-wing government under the Rhodesian Front. This political and economic situation resulted in the dissolution of the Federation in 1963, paving the way to the independence of Zambia and Malawi in 1964, while Southern Rhodesia continued under a White minority government that proclaimed a Unilateral Declaration of Independence (UDI) from Britain in 1965. The following pages give an overview of how the ARNI manoeuvred itself in this changing economic situation and during decolonisation. It further assesses how the dissolution of the Federation reconfigured trading relations among three territories and the implications of this on industrial development.
The discussion begins with the transition from the Federation of Rhodesian Industries (FRI), the predecessor to the ARNI. The second section analyses the existing economic and policy environment and the ARNI’s perspectives and responses on these. The next part discusses the road towards decolonisation and how the ARNI positioned itself under the circumstances. Lastly, the chapter examines the structure of secondary industry and its position in the economy. Broadly, the chapter maintains that industrialists managed with minimal state support. Other economic interest groups, in particular commerce, remained somewhat unsupportive of industrial development.
From the FRI to ARNI
The ARNI, established in 1957, succeeded the FRI, which until then had represented only the interests of industrialists in Southern Rhodesia. During the final congress of the FRI on 18 July 1957, Sir Malcolm Barrow, the Minister of Home Affairs (and former Minister of Commerce and Industry), urged industrialists to expand their membership to reflect the geopolitics of the Federation.
Colonial Zimbabwe’s Industrialisation in Retrospect
This book has offered an alternative historical account of colonial Zimbabwe’s industrial policy formulation and implementation which places industrialists, through their successive representative organisations, at the centre of the country’s industrial development. Local nascent industrialists and other local capital interests challenged the metropolitan ‘tradition’, which did not favour industrial development in colonies. That Southern Rhodesia was a settler colony with relative independence from metropolitan control helped, as it was able to formulate its own economic policies that were contrary to the British manufacturers and exports. However, the settler colonial state in Southern Rhodesia did not willingly introduce its economic policies. In many cases, this happened at the behest of the various economic interest groups. Manufacturing development was a case in point. With minimal government direction, and aided only by the smallest degree of protection afforded through the customs tariff, selectively granted only after careful consideration of various factors, industrialists risked their money and laid a sound base for the sector and the diversification of the economy evident in Southern Rhodesia by 1965. Although the government attitude changed between 1966 and 1979, its pro-industrialisation stance was not of its own volition. Industrialists and the state, each determined to protect their own interests, worked closely to sustain the economy under the weight of economic sanctions, international ostracisation, and the escalating armed liberation struggle.
The book has built on the observation – which scholars of Zimbabwean industrialisation have surprisingly ignored or overlooked – that the manufacturing sector in Rhodesia generally suffered from ‘the lack of state support … right up to the Federal period, through UDI and sanction’, a reality conceded in 1971 by the government, through the Minister of Commerce and Industry, Jack Mussett. According to Mussett, whose view is reinforced in this study, economic growth
was achieved by private enterprise and certainly in so far as manufacturing industry was concerned, with very little encouragement from government, for it was only towards the end of the Federal era that the Federal Government instituted a policy of assisting and protecting local industry through the Customs Tariff.
But even the claim by Mussett that the government introduced tariff protection towards the end of the Federation is contestable. For example, the Phillips Report of 1962 discussed in Chapter 5 showed that the government still believed that the manufacturing sector was dependent on agriculture and mining for its growth.
Ocean-going trade in the early modern period was fundamentally precarious, unpredictable, and fraught with peril. Merchants often had no choice but to bear the dangers – to ‘run the risk’ – of naked threats which, at worst, could mean the complete destruction of a season's invested capital, spelling ruin for an individual merchant-adventurer. The rage of the oceans often caused the total loss of ships and their cargoes, or inflicted extensive damage before goods reached markets. The violence of men, in the form of warships, pirates and privateers, raiders, thieves, and brigands, was sometimes an even greater danger. Especially in wartime, human risks to trade were recurrent and grave. At their height, enemy onslaughts against seaborne trade could endanger the whole commerce of a country, imperilling its military success, and potentially its independent survival.
Happily for merchants and nations, disasters arising from the manifestation of the intrinsic perils of the seas, mare, and of men, gentium, could be eased. Marine insurance could ensure that losses arising from such hazards were indemnified, and that the insured merchant's capital would be restored. A mature insurance system, such as that developed and honed in London during the period reviewed in this book, could underpin seaborne trade, and mitigate the risk of national catastrophe arising from enemies’ ocean-borne predation. The importance of London's marine insurance system to the expansion and success of England's trade was paramount, but its impact was much greater than this immediate function. It made far-reaching contributions to Britain's divergence from her Continental peers, both directly by spreading risk among the members of the merchant community, especially in the eighteenth century and particularly when beleaguered by formidable and repeated assault, or enthused by offensive opportunity, and indirectly from a much earlier period, through its continued contribution to the formation of the English state, as a conduit for the introduction of merchant approaches to institutions to the process of state formation.
Marine insurance became a critical component of national development, and of Britain's rise to great power and imperial status, most directly by extending private capital to the public projects of the state (including, towards the end of the nine-teenth century, directly through the investment of merchants’ capital, accumulated by insurers as a reserve to pay claims, in state borrowing instruments).