The primary objective of the Reserve Bank of Zimbabwe’s (RBZ) long awaited Monetary Policy Statement was to bring sanity to Zimbabwe’s chaotic economic world, especially the madness in financial and currency market. As RBZ Governor, Dr John Mangudya, readily admitted when he launched the policy statement. “This is essential in order to bring sanity in the foreign currency market whilst at the same time promoting exports, diaspora remittances and investments for the good of our national economy,” he said.
Sadly, instead of bringing sanity and stability he has only succeeded in mudding the muddy waters. After going through the statement it is clear that no one in RBZ and Ministry of Finance; headed by the flamboyant and blundering Professor Mthuli Ncube, who approved the statement; know what they are doing.
The statement confirms that insanity still rules supreme in Zimbabwe because nothing in the statement makes any sense. Nothing!
“Denominating the existing RTGS balances, bond notes and coins in circulation as RTGS dollars in order to establish an exchange rate between the current monetary balances and foreign currency. The RTGS dollars thus become part of the multi-currency system in Zimbabwe. The legal instrument to give effect to this has been prepared,” said the statement.
It should be noted here that RTGS balances were, until now, denominated Bond Notes, the electronic equivalent of Bond Notes and coins. The value of the RTGS was less than the Bond Notes and Coins for various reasons including convenience and electronic transactions were subject to the new 2% tax introduced last October by Minister Ncube. Whilst the exchange rate to Bond Notes and coins was 3:1 to the USD the equivalent RTGS exchange rate was 4:1 or worse.
So in denominating all Bond Notes balances and cash to RTGS$ means people have just lost out, instead of having Bond Note worth US$0.33 they now have RTGS$ worth US$0.25!
“The RTGS dollars shall be used by all entities (including government) and individuals in Zimbabwe for the purposes of pricing of goods and services, record debts, accounting and settlement of domestic transactions,” we are know told.
When Governor Mangudya was asked what is exchange rate for the RTGS$ against the USD; his reply was that the RBZ will not set a rate but would let the market decide.
It should be remember here that until this statement government had recognised only the official exchange rate of 1:1 of Bond Note to USD.
So by acknowledging the unofficial exchange rate of 4:1 those with the economic muscle will impose the exchange rate that suit them. Employers, including government, will never adjust the workers’ wages, agreed at on the basis of 1:1 exchange rate. Meanwhile all the goods and services will be charging in RTGS$ using the highest exchange rate possible!
Last time, October last year, when Finance Minister suggested government would let the Bond Note float this had caused serious financial turmoil as people rushed to sell their Bond Notes for the more stable USD; the exchange rate soared to as much as 10:1 and only started to come down when the Minister withdraw his foolish statement!
It is hardly six months since Minister Ncube’s ill-advise exchange rate comment and yet government is once again allowing the local currency float! Government has just fired the starting gun of the rat race to buy USD with RTGS$. The value of the latter will fall.
If government tries to impose price control by insisting on a stable RTGS$ price whilst allowing the market to determine the later’s value this will only result in shortages. Zimbabweans have been queuing for cash, fuel, bread, etc. the queues are only going to get longer and the list of commodities is short supply will increase.
“The Bank has arranged sufficient lines of credit to enable it to maintain adequate foreign currency to underpin the exchange market. This is essential to restore the purchasing power of RTGS balances through safeguarding price stability emanating from the pass-through effects of exchange rate movements,” said Governor Mangudya.
Zimbabwe’s chronic shortage of foreign currency is a child of the country’s skewed balance of payment. We are importing far more than we can pay for through our export earnings. We need to revive the country production to reduce the volume of imports, we are now net importers of food a far cry from our breadbasket of the region days. Creating lines of credit, dictating what people should spend their hard earned incomes on, etc. are not going to end the country’s foreign currency shortages and all the other economic problems.
It is laughable that Dr Mangudya should be admitting to the need to “bring sanity to the foreign currency market” when he knows that it was the RBZ and Ministry of Finance’s ill-advised policies that brought the insanity in the first place. By the same token he and Minister Ncube know the recent statement will do nothing to end the chaos and insanity in the Zimbabwe economy.
The two gentlemen know the madness in the Zimbabwe economy will not end until something is done to end the rampant corruption and to restore investor confidence in Zimbabwe as a stable country and not a pariah state ruled by vote rigging thugs. There can be no economic recovery, much less prosperity, whilst the country remains a corrupt and lawless nation. There can never be sanity whilst the insane continue to rule!
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Vote rigging and corruption have done more harm to the nations in one month than sanctions have done since they were imposed in 2001! For someone therefore to be protesting about sanctions even with the benefit of all the documented details on the three issues only goes to show just how shallow minded some people are.
Democracy never had a chance of taking root in Zimbabwe given we have corrupt and murderous thugs armed with guns who were determined to impose their tyrannical will on the nation, on the one hand. And on the other hand, a very naive and gullible electorate who have always struggled to get their heads round any major national issues and preferred to follow blindly like sheep. Even now with the country up to her eyes in trouble because of decades of Zanu PF corrupt and tyrannical rule, we still have people who still belief the discredited Zanu PF imaginary enemies of the nation!
Reserve Bank of Zimbabwe (RBZ) Governor Dr John Mangudya has admitted that the economy has largely deteriorated since last monetary policy statement in October 2018, we now in an (highly) inflationary environment and parallel market rate has more than doubled.
This is just voodoo economics at its worst! Zimbabwe’s foreign currency shortage is a result of Zimbabwe’s failure to earn foreign currency through export to march the ever ballooning import bill! Creating credit lines and other measures will solve nothing!
Zimbabwe’s economic recovery will never happen whilst the country remains a pariah state ruled by corrupt and vote rigging thugs!
How EU can admit Zanu PF rigged last July's elections and still decide to let the regime off the hook beggars belief! They would never ever tolerate that in any one of their member states and rightly so too. Why they did so here only goes to show how the EU will undermine those who have fought hard for free, fair and credible elections for selfish European interests!
For countries like Zimbabwe to end corrupt and tyrannical rule, we the people have not only to fight the tyrants at home, their socialist backers in Asia and now add the democrats from the West! It is at times like this one deeply regrets the wasted golden opportunities Zimbabwe had to end the Zanu PF dictatorship. Tsvangirai and his MDC friends sold-out by failing to get even one reform implemented in five years of the 2008 GNU and the nation have paid dearly for it!
“The Party leadership met for six hours today and noted the continued suffering of ordinary Zimbabweans due to the non performing economy and failure to deliver by Mr Mnangagwa’s administration. The leadership however, restated the position that the MDC will only take part in a dialogue that is presided over by a credible, independent, mutually acceptable mediator/convener. It is only under such a convener that an agenda can be adopted and a sincere dialogue process begin to unlock the challenges affecting ordinary Zimbabweans,” writes Jacob Mafume.
MDC has said it would like to see the proposed national dialogue lead to the implementation of the democratic reforms and an end to the curse of rigged elections. Every thinking Zimbabwean would agree that implementing the reforms and holding free, fair and credible elections is the number one issue on the nation’s agenda.
Indeed, this has been the number one issue ever since the late 1990s when the people of Zimbabwe started demanding democratic change in earnest. Many Zimbabweans have risked life and limb to elect MDC leaders into power on the understanding the party will bring about the changes the nation has been dying for!
God knows MDC leaders have had many golden opportunities to implement the democratic reforms necessary to guarantee free, fair and credible elections and yet they have wasted them all. The party was reminded on countless occasions not to contest the elections without first implementing the reforms but would not listen.
“MDC has stringent measures to stop Zanu PF rigging the elections!” Chamisa claimed.
“MDC has developed Winning In Rigged Election (WIRE) strategies!” chipped in Obert Gutu, then MDC-T party spokesman.
This is no doubt that MDC Alliance has ignored implementing the reforms all these years and is only picked these up now to give the call for dialogue credibility. The primary reason MDC Alliance want the talks is so Nelson Chamisa and a few others can get a seat on the gravy train just as happened during the last GNU.
A GNU led by Zanu PF will never implement the democratic reforms to guarantee free, fair and credible elections. The party failed to implement the reforms last time it is naïve to believe the party thugs would want to do so now when they have a lot more at stake than in 2013!
Chamisa and the rest in MDC Alliance know Zanu PF will never implement the democratic reforms and the international community know this too hence the reason why there will be no meaningful economic recover. The world will still consider Zimbabwe a pariah state with or without Chamisa and a few MDC Alliance friends.
Zimbabwe should focus all its energy on forcing Zanu PF to step down to allow for the appointment of an interim administration that can be trusted to implement all the democratic reform. MDC Alliance are once again an unwelcome distraction!
The Grain Millers Association (GMAZ) general manager Lynette Veremu wrote to the National Bakers Association of Zimbabwe (NBAZ) to tell them the country not pay for 55,000 tons of wheat in bonded warehouses in Mozambique and Harare.
“We regret to advise that the current stocks for foreign wheat for bread flour have depleted to 5,800 tonnes and… we are left with less than eight days of national bread flour supplies,” the letter said.
GMAZ spokesman Garikai Chaunza confirmed the letter, saying “this is the situation we are faced with.”
Once upon a time, it now sounds and feels like it was 100 million years ago, long before the dinosaurs ruled the earth (they are back ruling Zimbabwe), Zimbabwe was the breadbasket of the region! Now we are the basket-case of the failed state, the crocodile, the surviving relic of those dim-witted lizards, and his cronies rule the roost!
Zimbabwe’s economic meltdown will only get worse because there is no chance of any meaningful economic recovery as long as the country remains a pariah state ruled by corrupt and vote rigging thugs. The only solution is for Zanu PF to step down and allow the holding of free, fair and credible elections! All this talk of national dialogue is just a waste of time and space!
China’s acting ambassador to Zimbabwe said his country is confident Zimbabwe will achieve its developmental goals under President Mnangagwa’s leadership whose reforms will transform the country and attract more investors.
Addressing delegates during the 2019 Chinese Spring Festival gala in Harare on Sunday night, Acting Chinese Ambassador to Zimbabwe Mr Zhao Baogang, who is also the Charge d’Affaires at the embassy, noted that Zimbabwe had faced developmental challenges but would achieve its goals.
Since when has China ever care whether Zimbabwe developed or drowned man-made hell-on-earth as long as China milked Zimbabwe for everything it can! Indeed, China has played a major part in encouraging Zimbabwe’s economic demise and breakup with the west leaving Zimbabwe dependent on China and thus ripe for exploitation by China.
Mnangagwa is China’s puppet and they will prop up this Zanu PF regime for as long as they can provided China continues to get more from Zimbabwe than it is putting in. Helping Zimbabwe develop is the least thing China would want to do since Zimbabwe is a market for Chinese products!
The United Nations (UN) says it remains committed to spurring economic development in Zimbabwe in a bid to help the country achieve President Mnangagwa’s 2030 agenda.
The newly appointed UN Ambassador to Zimbabwe, Mr Bishow Parajuli said the international organisation has for many years committed to the nation’s development and will continue to support the President’s vision of transforming the country into an upper middle income economy by 2030.
The Ambassador also revealed that Zimbabwe is among eight African countries selected by the UN to benefit under a US$21 million fund earmarked for gender based violence programmes.
Zimbabwe’s greatest challenge right now is how to force Zanu PF to step down following the party rigging last year’s elections. Zimbabwe is stuck in this hell-on-earth because the country has failed to remove Zanu PF from office for 38 years and counting. Why is the UN pretending this Mnangagwa regime is legitimate when we all know it is illegitimate!
EU election observers confirmed in their report that Zanu PF rigged last July's elections and the only logical reason the EU did not bother punish the party with the new sanctions is because some EU members do not care that the elections were rigged. What they want is to be able to trade with Zimbabwe and have their share of the country's wealth. EU wants to join China, Russia, Israel, India and a number of other countries who have continued to trade with Zimbabwe regardless of the country's poor human rights record and the suffering masses.
Countries like Belgium have been calling for the lifting of EU sanctions for years. Since when has Belgium ever cared about the black Africans?
EU did not impose the sanctions because the believe in Mnangagwa's "sincerity in seeking a better live for Zimbabweans"! And we are to believe Mnangagwa is delivering that better live by rigging elections and beating, raping and even killing all who dare protest the rigged elections and tyrannical oppression. How idiotic is that!
Ordinarily I would not be surprised that someone like Dr John Mangudya, Professor Mthuli Ncube and many others would all agree that the Zimbabwe economy will never recover as long as nothing is done to end the rampant corrupt in the country. They know nothing is being done to end the corruption because the political ruling elite are the ones who are corrupt. They also know that the only solution is for the country to hold free, fair and credible elections. They have not only failed to lift a finger to demand free and fair elections but worse still they know that by working for the regime they are in fact playing their part in propping up this corrupt and vote rigging regime.
They will continue to work for the regime because they are well paid for their services and they do not care that they are contributing to the nation's economic collapse and the suffering of millions of others.
There are people out there who would happily sell their own mother's for a price and boast their had a mother to sell. The tragedy for Zimbabwe is that we have more than our fair share of such people. If Mangudya or Ncube were to resign in protest that Mnangagwa rigged last year's elections - there will be one hundred thousands equally qualified Zimbabwe who would happily work for Mnangagwa even if the tyrant's hands were dripping blood of the latest victims of his shoot to kill policy! Such is level of moral decay in Zimbabwe today!
The idea that the EU must have decided not to impose sanction on the Zanu PF leaders and those propping up the regime for selfish gain because the EU was impressed by “President Mnangagwa's sincerity to better the lives of locals” is laughable. The EU Foreign Ministers who made the decision would have read the EU Zimbabwe Election Mission’s report and also the EU parliament’s resolution gave the minister the ask of reviewing the sanction. The parliament resolution given even more examples of how the Zanu PF regime has again and again blatantly violated the basic human rights of the locals.
Of course the Foreign Ministers ignored the facts on the ground proving that if the EU cared about free, fair and credible elections and helping the long suffering Zimbabweans end this nightmare of corrupt and tyrannical Zanu PF rule then they would have imposed the sanctions without a moment’s hesitation.
It is not the first time that European selfish economic or political interest have trumped reason, justice and even the right to life itself when it is black Africans paying the price. This is the case here.
Of course Mnangagwa and his cronies were very pleased with the EU decision, he will now step up his brutal repression and do nothing to ensure next elections are free, fair and credible knowing that China, Russia and now the EU will see nothing wrong.
During the slave trade it was not the white man who hunted the blacks slaves; it was fellow blacks who did that and sold their own kith and kin for a fistful of beads and a piece of calico cloth! These blacks selling fellow blacks were very disappointed when slavery was abolished just as Mnangagwa and his cronies will be furious if the curse of rigged elections was dismantled!
But Daniel Shumba's United Democratic Alliance (UDA) withdrew from the second meeting because they were "insincere, choreographed, and a highly compromised process”
This is just grandstanding! Whatever Mnangagwa does in these talks the process can never be worse than the flaws and illegalities in the conduct of last year’s elections. Daniel Shumba was warned about the flaws and illegalities in the election process and yet he and the rest participated in the elections regardless. For these idiots to now boycott these inter party talks to chaired by an illegitimate regime is comical.
Chamisa’s position is equally nonsensical. By participating in last year’s elections he per se accept the power and authority of ZEC regardless of the flaws and illegalities in the conduct of the elections. For him to then refuse to accept the power and authority of the Con-Court is foolish because he should have known they are just as corrupt and incompetent as ZEC.
Let me say here and now, these inter party dialogues are a waste of time. Last year’s elections were flawed and illegal and therefore could never produce a legal outcome. We need an interim administration to prepare for fresh elections and restoration of legality! This Zanu PF regime is illegitimate and all this talk that Chamisa can somehow change that by ‘recognising Mnangagwa as the legitimate president” is all nonsense. If the process is illegal the outcome can only be illegitimate no one individual can change that!
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