Sunday, 6 November 2016

Zvorwadza there good reasons to reject bond notes do not discredit them by questioning legality.

Let me say upfront that I admire people like Sten Zvorwadza and all the other of the social media heroes and heroines for their courage and passion in leading street protests from the front. However, I am not entirely convinced that some of these street protests, well intended as they clearly are, are helping us get out hell-hole we find ourselves in but are instead just a rat-race taking us round and round in circles.

Take the issue of bond notes, Sten Zvorwadza has vowed to stage street protests, starting on 18 November 2016, to force this Zanu PF regime to abandon its drive to introduce bond notes in Zimbabwe. An admirable stance but first, we should be absolutely what the protesters are demanding.

Zimbabwe finally scrapped its Z$ in November 2008, in favour of a basket of foreign currency, when it was near impossible to carry out any meaningful transaction using the Z$ because currency was losing its value by the minute. Inflation peaked at 500 billion per cent, a world record; fueled by the country’s economic collapse and the regime’s foolish notion that it can solve all the nation’s economic problems by printing more Z$.

The years of hyperinflation, 2000 to 2008, have crippled the national economy and wiped out many people’s investments. Since the scrapping of the Z$ inflation has dropped to single digit percentage points but scrapping of the Z$ alone was not enough to trigger meaningful economic recovery.

It was Zimbabwe’s failure to revive the economy since November 2008 that is behind the cash shortage and forcing the regime to go back to using local currency. Because local industry had all but collapse by 2008, the country has had to import almost everything. Since we import a lot more than we export our balance of payment has been negative and has continued balloon with time. With a net flow of foreign currency out of the country it was just a matter of time before the country started to run out of cash. We have done just that!

This Zanu PF regime now wants to reintroduce the Z$ (calling it a bond note, does not change the essential element that it is the local currency back) ostensibly to allow local transaction to be paid in the local currency and free the foreign currency to be used in foreign transactions. But since the regime has done nothing to address the underlying causes of our economic collapse we will still need to import and thus the foreign currency hemorrhage will continue.

With unemployment rate sitting at a nauseating 90% plus, it was 80% plus in 2008 and has steady crept up; most people have eked a living by importing building materials, clothes, food - we even import milk – (a sorry state for the nation that used to be the breadbasket of the region) and selling them. We have become a nation of importers and vendors!

Since the regime has done absolutely nothing to revive the country’s economy and thus reduce its dependence of imports the people have three good reasons to fear the reintroduction of the Z$:

a)     With unemployment a nauseating 90% and millions now living in abject poverty, vendors sell to those in formal employment and not fellow vendors, the need to revive the economy is now a matter of life and death. By reintroducing the Z$ will free the foreign currency for foreign trade but doing nothing to reduce the need for imports. So reintroducing the Z$ is doing nothing to revive the economy whilst kicking the crunch of the shortage of foreign currency to pay for imports further down the Street.

b)     The regime will force the ordinary people to accept the bond note at the official exchange rate and force those lucky enough to get foreign currency to sell them through designated channels at the official exchange rate. If the ordinary people need foreign currency, they will be forced to buy on the black-market at exorbitant exchange rates. Meanwhile the ruling elite will be allowed to buy foreign currency at the low official rates and sell on the black-market at the exorbitant rates. The reintroduction of the Z$ will therefore be big money maker for the ruling elite milking povo!

c)     The shortage in foreign currency will bring back the days of empty shop shelves and hit the vendors will pay for the imported goods in foreign currency but force to accept worthless Z$ from their customers because that is all they have.

Last week President Mugabe issued a decree clearing the way for the issuance of bond notes as legal tender using Presidential Powers (Temporary Measures) Act (Chap 10:20).

Alex Magaisa, Tsvangirai’s legal adviser during the GNU, has said decree was illegal because President Mugabe is forbidden from amending a primary law in terms of section 134 of the country’s new constitution.

“Parliament may, in an Act of Parliament, delegate power to make statutory instruments within the scope of and for the purposes laid out in that Act,” states section 134. And goes on to explain that the statutory instrument “must not be consistent with the Act of Parliament under which they are made”. Magaisa’s argument being that the decree not consistent with the existing law.

What Magaisa has failed to appreciate here is that Presidential Powers (Temporary Measures) Act is not a statutory instrument nor was it ever meant to be and reading it, confirms this.

Mai Mujuru has gone to the Constitutional Court with her challenge of the legality of Mugabe’s decree. "As Head of State, he ought to allow Parliament to do its work," she says.

Yes, having to resort to using presidential powers to introduce the bond notes is clumsy but that is not to say it is illegal.

Of course Zimbabwe has every right to issue and use its own currency as legal tender within its national borders. We should be careful that our mistrust of this Zanu PF regime does not go overboard because the regime will ridicule everything else we say and do.


People like Sten Zvorwadza must be careful they do not bland their legitimate and very reasonable demands by listening to confused people like Alex Magaisa and Joice Mujuru who are so desperate for attention and political relevance they will make stupid and baseless claims! Passion and courage are very important and useful virtues but unless they are guarded at all times by reason they are useless and even a curse!

11 comments:

Zimbabwe Light said...

PRESIDENT Robert Mugabe's government has reportedly availed $3 million to the War Veterans' ministry to wrestle control of the Christopher Mutsvangwa-led Zimbabwe National Liberation War Veterans' Association (ZNLWVA), NewsDay reported.

Mutsvangwa is waking up to the political reality of how Mugabe has used looted wealth to buy support now because this time he is the victim of the corruption. Personally Mutsvangwa should have a taste of his own medicine!

Zimbabwe Light said...

PRESIDENT Robert Mugabe's government has reportedly availed $3 million to the War Veterans' ministry to wrestle control of the Christopher Mutsvangwa-led Zimbabwe National Liberation War Veterans' Association (ZNLWVA), NewsDay reported.

Mutsvangwa is waking up to the political reality of how Mugabe has used looted wealth to buy support now because this time he is the victim of the corruption. Personally Mutsvangwa should have a taste of his own medicine!

Zimbabwe Light said...

Zanu PF is a party of thugs and it is only the naive people like Chamisa who got a chance to stop the thuggery and wasted it and are now wittering about thuggery to stopping as if by magic!

We must now demand the full implementation of all democratic reforms before the next elections and stop leaving our future to chance and corrupt and incompetent leaders like Chamisa!

Zimbabwe Light said...

The fact still remain that you, Tendai Biti and your fellow MDC leaders like Tsvangirai and Ncube, had the golden opportunity to implement democratic reforms which would have ended in free, fair and credible elections in 2013 and almost certain end of Mugabe's corrupt and tyrannical rule. You failed to implement even one reform in five years of the GNU. Not one!

Indeed, you were all tripping over each other in singing Mugabe praises. You Tendai Biti called Mugabe "the unflappable father of the nation" in July 2012.

The tyrant granted you all all manner of gravy train luxuries, a $ 4 million mansion for Tsvangirai, a former white owned farm for Ncube, etc. and MDC forgot about the reforms and the tyrant was transformed into the infallible demigod. It was only after Mugabe rigged the 2013 elections and booted you Mr Biti out of your Minister of Finance Office that the demigod was transformed back into the corrupt and murderous tyrant you now condemn!

Biti, you and your MDC friends have already proven to be breathtakingly corrupt and incompetent. If Zimbabwe was a healthy and functional democracy with diligent and informed voters and not the naive and gullible wildebeest who follow no-questions asked you and your friends would have been forced to resign from all public life after the rigged July 2013 elections.

You and your corrupt and incompetent friends have your beady eyes on winning seats back on the gravy train; you do not give a damn about the suffering masses and never did. Your passionate speech here is as empty as Mark Antony's eulogy over Julius Caesar's blooded. If Mugabe offered you a seat back on the gravy train tomorrow you will once again be calling the tyrant unflappable!

You sold-out during the GNU and it will be sheer folly to entrust people like you BIti with a proven track record as corrupt and incompetent leaders with the destiny of the nation ever again! You can dream all you like of a seat back on the gravy train, it will not happen - not if I can help it!

Nomusa Garikai said...

Grace Mugabe bust on the political scene with a very loud bang and for the last two years she has tried to keep up the high tempo. She has kept up the pretence punching and insulting everyone with complete immunity - she has President Mugabe's licence and that is better than James Bond's licence to kill.

Sadly for Grace instead of delivering a knock out her opponents she has knocked herself out. Everyone can see she was desperate to win power at all cost and that was all she wanted. For a country that is down on its knees in the gutter and have been for the last 36 years; the last thing the nation wanted to hear was someone hot to be president but does not even notice the misery all round.

Frankly many people are pleased Grace's pitch for president is over. She arrived on the stage with a bang but went out with a whimper!

Zimbabwe Light said...

Mpilo Hospital had no running water all day on Saturday and all operations were cancelled for the day.

A few weeks ago the institution said it had stopped all routine operations because it had run out of drugs. Mpilo Hospital is one of the top four referral hospitals in the country and if things are this bad at Mpilo there are a lot worse for the smaller hospitals and clinics!

The whole of Bulawayo city is facing serious water shortage and the Council has already started to ration water. Some areas have gone for a whole week without running clean water!

There will be no end to our problems until we address the problem of bad governance at the centre of all our political and economic problems.

Zimbabwe Light said...

What makes you think that Zanu PF chefs are not involved in the forged bond notes racket? The very fact that the Police and CIO have stayed well clear of the matter is proof they are following instructions.

Mugabe told the nation that $15 billion of diamond revenue was looted in February and today, ten months later, no one has been arrested. Think!

We have a thousand and one perfectly good reasons why we must reject the introduction of bond notes the main one being that we cannot trust this regime to have the financial discipline not to print more and more bond notes and thus fuelling the hyperinflation of 2008. The least the regime should have done is enact laws to ensure transparency and tight monetary controls of the new currency before the release of bond notes.

To reject the bond notes on the basis that they are illegal is spurious, to say the least, because it presupposes that we have no legal right to issue our own local currency and call it what we please!

So to abandon solid ground of rejecting bond notes on the basis that nothing has been done to prevent yesteryear’s Z$ hyperinflation, etc. in favour of rejecting them on shaky grounds that they are illegal is dumb!

Zimbabwe Light said...
This comment has been removed by the author.
Zimbabwe Light said...

We have someone in State House with "several degrees in violence", his words not mine. His name is Robert Gabriel Mugabe, he is the one who has created and sustained this culture of violence for his own selfish political gain.

The years of corrupt and tyrannical rule under this Zanu PF dictatorship has destroyed the nation's economy leaving millions of our people destitute. A hungry man is an angry man!

The only way to end the economic meltdown gripping the nation is by ending the Zanu PF dictatorship. And to end the dictatorship, we must implemented the democratic reforms designed to dismantle it and replace it with a democratic system of government.

For the record, it was Tendai Biti, Morgan Tsvangirai and the rest of the MDC leaders who should have implemented the reforms during the GNU; they had five years to do so. They failed to get even one reform implemented in five years.

Unless we implement the reforms before the next elections it is almost certain the elections will be rigged and Zanu PF may even resort to the wanton violence of 2008. The NTA is one possible vehicle with which to implement the reforms.

Zimbabwe Light said...

We have someone in State House with "several degrees in violence", his words not mine. His name is Robert Gabriel Mugabe, he is the one who has created and sustained this culture of violence for his own selfish political gain.

The years of corrupt and tyrannical rule under this Zanu PF dictatorship has destroyed the nation's economy leaving millions of our people destitute. A hungry man is an angry man!

The only way to end the economic meltdown gripping the nation is by ending the Zanu PF dictatorship. And to end the dictatorship, we must implemented the democratic reforms designed to dismantle it and replace it with a democratic system of government.

For the record, it was Tendai Biti, Morgan Tsvangirai and the rest of the MDC leaders who should have implemented the reforms during the GNU; they had five years to do so. They failed to get even one reform implemented in five years.

Unless we implement the reforms before the next elections it is almost certain the elections will be rigged and Zanu PF may even resort to the wanton violence of 2008. The NTA is one possible vehicle with which to implement the reforms.

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