A NUMBER of market events have come to pass following the announcement of results of the July 31 harmonised elections.
Report by Own Correspondent
This article argues that while we may call them conspiracy theories or characterise them in any number of politically convenient ways we may chose, these are in fact the real economic issues crying for our attention and needing to be dealt with.
We must not shoot the messenger — in this case in the form of market sentiment or market forces.
We must do something about these issues since that will be our true test as a sovereign country because facts are stubborn and can’t be wished away.
We must not become eternal conspiracy theorists who furiously engage in the unproductive pursuit or pastime of seeking out speculation and quashing it.
- The Return of the ZWD: Anxiety about the return of our defunct currency reminds us that, having adopted other people’s currencies which we can neither print nor wish into existence, we have an obligation to say and do things that make the multi-currency regime a viable and sustainable proposition.
In the meantime, we have to work hard to create conditions suitable for the return of our own currency, instead of just waiting for that day to arrive.
- Panicky withdrawals: The clear message is that since adopting the multi-currency regime, we have done precious little to inspire confidence in the banking public regarding the direction of currency reform, that’s why when the chickens come home to roost, we can only rely on strident denials and rebuttals.
We have been thoroughly reactive in dealing with this elephant in the room, when pro-active is what we should have been.
Panicky withdrawals also just plainly tell us that we do not have enough liquidity to go around and even small market movements can shake the market to its core, so we have to adopt policies that encourage liquidity to flow into the country.
- Stock Market Plunge: If
$1 billion worth of shareholder value can be lost within three weeks because of our commissions or omissions.
Theoretically it means that we can do or say enough to wipe out the whole stock market by January 2014.
Whether meltdown is a result of investors reacting to the poll outcome or investors behaving as investors are wont to do after an election, what the Zimbabwe Stock Exchange sell-off tells us in no uncertain terms is that we should be careful what we do or don’t do in the next five months and beyond.
- Migration to South Africa/Visa Regime: Whether the recent trend of Zimbabweans allegedly “pouring” into South Africa in large numbers since the conclusion of elections is due to those based south of the Limpopo who had come back home to vote, cross-border traders who had temporarily suspended their trips in the run-up to the elections or those relocating to Mzansi due to uncertainties gripping the country in the wake of the disputed poll, that is probably not the issue.
The real issue is that over the years, the conditions at home have evolved and conspired to force at least 1,5 million Zimbabweans to migrate to South Africa.
The issue is not about denying them the opportunity to leave when they want to, or denying that they are leaving, it is about creating conditions for them to willingly return home.
- Zesa load-shedding: We may bring pressure to bear on Zesa Holdings (Pvt) Ltd, forcing them to publicly deny allegations of deliberate economic sabotage, but what the load-shedding really tells us is that since 2007, the country has had to deal with a power deficit of 400MW at any given time.
The load-shedding is the writing on the wall — since independence in 1980, we have done precious little to create new capacity to deal with the power deficit as the country’s power requirements continued to grow significantly.
What the emerging post-election trends are telling us is the plain, inconvenient truth.
Let’s deal with it.
And, let’s not deal with people please, let us deal with issues.