Govt must stop lying on inflation

editorial comment

EXACTLY a year after Zimbabwe’s first biggest fuel hike since President Emmerson Mnangagwa took over the reins of power from the late Robert Mugabe, the administration was at hand to celebrate the January 14, 2019’s 150% fuel hike anniversary with a yet another fuel price increase.

While this time around the increase over the weekend was a modest 10%, it represents a major milestone in a year that the fuel adjustments have brought nothing but misery and death upon the Zimbabwean citizenry. At the weekend the Zimbabwe Energy Regulatory Authority announced new petrol and diesel prices of $18,28 and $19,55, respectively, which essentially means that in just a year the price of fuel has risen by a jaw-dropping 1 284%.

While the country’s so-called financial gurus held the entire country hostage, held the gun to every citizen’s head and banned any talk of inflation whatsoever, this simple kindergarten mathematical observation clearly shows that even the assumed unofficial inflation figure of over 500% is a gross understatement.

Finance minister Mthuli Ncube promised to start publishing the annual inflation figures next month, and many are definitely going to accept whatever the minister dishes out to the nation with a pinch of salt simply because the fuel price increase alone tells a harrowing story. Is it not high time the government stopped hoodwinking its citizens as far as inflation and the country’s general economic performance is concerned? The general outlook does not appear good at all, given the obviously poor rainfall season that spells disaster for one of the country’s major foreign currency earners: Tobacco.

It is a fact that many tobacco farmers failed to return to the field this season after proceeds from their last harvest fell way too short to afford them the chance to stock up on inputs following government’s poor handling of their pay cheques. Having promised to pay the farmers half in foreign currency and the other half in local currency, the government made a violent about turn and decided to force the farmers to buy their other 50% foreign currency component at a rate which was essentially a moving target. This significantly eroded their earnings at a time the Zimbabwe dollar was losing value to the US dollar every day. In other words, there will be very little tobacco to shore up the country’s economic performance.

Ncube has already admitted that food, power and currency stability are the three things that are giving him sleepless nights and as yet another drought looms, his hours of lack of sleep will evidently lengthen. There is little hope that Zimbabwe’s main power supply source, Lake Kariba, will have enough water to improve generation capacity given that the devastating drought is regional. With tobacco in a poor show, there is little chance that food crops will fare any better. And on the currency front the situation on the ground already points to the Zimbabwe dollar heading for a brutal bashing from other major currencies having, for the first time, been upstaged by the South African rand with which it has for some time traded at 1:1.

So many hope and fervently pray that Ncube and his colleagues will be honest and stop pulling wool over people’s eyes as far as the country’s overall economic performance is concerned.
There is no reason or justification for government to keep lying to itself and the nation that all is well at the front when it is not.

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