When people rise to higher offices

By Amh Voices | May. 16, 2023

Letters to the Editor

WHEN people rise to higher offices, their heads get lost in the clouds. Some, notwithstanding their strong rural backgrounds, become oblivious to the real situation of the ordinary citizenry. They suddenly are the socrates of this modern world, fathoming far-fetched solutions to what are seemingly very ordinary circumstances.

The high office disease seems to affect everyone without exception, economists, accountants, not to mention politicians. Those of us in ordinary spheres of life are left bereft of direction and puzzled by these high office bearers’ solutions to our daily problems as we struggle to live from one day to the next. Very often, politicians are the most susceptible people to this disease, followed by economists.

My focus in this article is at Number 80, Samora Machel Avenue, home to our esteemed reserve bank. The Reserve Bank of Zimbabwe (RBZ) is the controller of all the banks in the country. It exercises oversight over the financial services sector and manages the country’s monetary policy in close conjunction with the fiscal authorities.

It is the custodian of the local currency. Its pride (or is it its success) should derive from the potency, stability and purchasing power of the currency. The central bank can only brag of success if the currency it has in place is stable. Anything short of that puts the central bank’s success in dispute. When a central bank measures its success away from the strength of the currency it presides over, then there is a problem, big problem indeed.

Suffice to put aside the Gideon Gono era and concentrate on the years after him. A cocktail of measures have been adopted by the reserve bank to try and stabilise the local unit. To start with, the local unit was re-introduced in 2019 after it had long been buried in 2009. When it was introduced, there was public outcry from almost all corners of society that the timing was wrong, that the necessary enabling requisites were not yet there.

Even the incoming Finance minister Mthuli Ncube before he got ensconced in his high-rise office, had correctly observed that bringing back the Zimdollar (bad money) would drive out the good money. No sooner had he gotten into a high-rise office than he started to see things the other way round. It was fatal mistake number one. And one wonders what really gets into people’s minds when they get into higher public offices.

Suddenly they see what we don’t see, even if they saw it before they got into office. Amazing, isn’t it? But don’t they say it’s “unAfrican” to talk while eating.

Blunder number two was the declaration that the newly-introduced Zimdollar was equivalent to US$2,50. As much as we may not be privy to the formula used to arrive at that exchange rate, chances are that it was not a demand-supply determined exchange rate. When economists do those kind of things and they oversee the country’s apex bank, then there is a big problem. Economists are supposed to be masters of demand and supply dynamics and must accordingly be guided. Unfortunately, the market knows no high-rise office bearers, and as expected the exchange rate shot through the roof in a short space of time.

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Having failed to tame the stubborn exchange rate, the reserve bank, creative as ever, came in with the foreign currency auction system. Like any medicine administered to some critical patient, the auction system temporarily put at bay the ever-spiralling exchange rate. The apex bank failed to fulfil allocations, sometimes falling several months behind. Again, this bore testimony to the fact that the bank was failing to pinpoint the cause(s) of the runaway exchange rate. But as expected, the bank remained adamant and kept the auction system on. The system is limping on as I write.

But like ever before, the central bank is forever conjuring new tricks to try and harness the elusive exchange rate. In came the gold coins. It was believed they were going to be the magic wand to soak away the inflationary tendency of the local unit. Sales figures of the newly-minted gold coins were published in the State-owned Press and on television. For sure, people bought the gold coins, and are still buying them, they can continue to buy them ad-infinitum.

The fact, however, remains the local unit is still plunging and will continue to do so. It can, therefore, be asked what is the underlying problem that in the face of all these interventions, the local currency is still not stabilising. As far as I can see, it’s all because when people ascend to high positions, they become oblivious to reality. But why? I will come to that latter.

Now our esteemed central bank says it is introducing digital gold coins, whatever that is. What is the probability that this will change anything? The central bank says this will complement the gold coins in a big way. Living above the clouds of course, nothing else. The exchange rate is now at a whooping $3 000 to the green buck.

But let’s face it. What’s our undoing. Is it really that the central bank does not know exactly what needs to be done to fix the problem. I refuse to accept that school of thought. Near barren neighbour Botswana with an economy anchored solely on a few diamond mines and livestock has a currency stronger than ours although we have a plethora of minerals, vibrant agriculture and a reviving manufacturing sector.

If a peasant with two donkeys and a few chickens is doing better for his family than another peasant with a hundred heads of cattle, then the hundred heads of cattle owner has some serious management problems. The economists will of course accuse me of oversimplifying the scenario. They should, however, know that that’s how us ordinary people look at it.

I put our undoing on the lack of integrity, national pride and leadership on the people who hold public office in our country, especially at the very top. There is general failure to strike a balance between political and national interests.

It is my opinion that the apex bank office bearers know exactly what needs to be done to fix the problems of our local unit. Unfortunately, these solutions run right in the faces of politicians who refuse to accept those solutions. Timidity overcomes our otherwise well-meaning apex bank office bearers who give in and follow directions they know are not helpful.

Politicians are not known to accept things that will shed away support from them even if in the long run this will turn out for the better. Giving in to political pressure should not be excusable, it is a weakness. - Mutemo Pisa

Govt has never had an economic strategy'

THE state of paralysis in which our motherland finds herself can be traced back to the early 1980s.

A number of economic policies have been crafted and implemented and yet the economy remains in the intensive care.

The country’s economic policies have been failing dismally. Thank God, this analysis does not seek to address issues to do with the “blame game”, but rather attempts to demystify economic policy dynamics by critically examining the success/failure of economic policies implemented since 1980.

We have had many economic blueprints from the Economic Structural Adjustment Programme, ZimAsset and Zimbabwe National Development Strategy 1 (NDS1).

The only thing that is needed in the country is good politics and paying our debts rather than swallowing more than we can chew.

The economy has been on a free-fall due to lack of monitoring. Are these blueprints achieving their objective?

The former British territory, Zimbabwe, has been an independent nation for 43 years now and is one of only 23 countries with a gross national income per capita below US$2 000. Low-income countries typically rely on agriculture and in Zimbabwe, farming accounts for 67% of total employment.

The problem is that the Zanu PF-led government has never had an economic strategy since 1980, all it did was benefit from a strong economy left by the late Rhodesian Prime Minister Ian Smith and it went on spending, looting and stealing spree. Economic building is all about trust.

The most important question is: Do the people have trust in the government?

Trust is the most valuable currency in economics. People and institutions local and abroad should have trust in the government and the question still remains: Why do the people not “trust” the government?

Every year, people are fed with lies and propaganda that the economy is performing very well. Come the following year, you hear the same government reading a different script, that the previous year’s economic performance was bad and that the coming year is promising and will be great in economic performance and yet the results will be speaking for themselves on the ground.

Of late, Zanu PF has been focusing more on winning elections than fixing the economy. There is need to revitalise the dying economy.

Economic reforms are the best foot forward for development. People are tired of a government which boasts and hits its chest for winning elections while the majority is living in abject poverty.

Politicians must stop the looting and smuggling of minerals. - Citizen

IN response to Industry frets over suspension of duty, BLESSING TAVARAISA says: Well done our government for putting in place a policy that is pro-citizens.

GEORGE CHIPARA says: The problem is these captains of industry are milking the people by overcharging. We can import our own basic commodities and they will cry foul.

SAM SOFASONKE SITHOLE says: That is the problem of being capitalist. They don’t care about people around them. They are only interested in making profit.

IN response to Chitembwe thrilled with Caps’ progress, despite draw, TAURAI CHIRIKWAWO says: I watched Caps United play Dynamos. The Green Machine impressed me most because they never changed their style of play even if they were trailing. Their passing game reminded me of the days of Charles Mhlauri.

MILTON USORE says: Keep up the good work Caps United, our strikers need to pull up their socks.

IN response to Zanu PF bigwigs sweat over poor rally attendances, TADIWA MAPONGA says: This is a reflection that the people no longer listen to Zanu PF’s fake promises and have lost confidence in it because of its failure to resuscitate the economy.

IN response to Govt pounces on schools rejecting Zimdollar, EPHRAIM CHITURO says: Government should know that the Zimdollar has collapsed. Mthuli Ncube is out of touch with reality. He has dismally failed to stabilise the local currency. People have lost confidence in the Zimdollar.

IN response to Lupane juice maker eyes export market, WILLARD MOSES says: This is what we expect from our local companies, especially in these hard times when they get no funding from government.

IN response to CDF disbursement delays stifling development: MP, DAIRO MAMBO says: We have not seen any meaningful development from these Constituency Development Funds. This is just a looting scheme used by our politicians.