HomeLocal NewsMnangagwa ignorant of economic issues: US economist

Mnangagwa ignorant of economic issues: US economist

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BY FIDELITY MHLANGA

RENOWNED United States economist Steve Hanke yesterday said President Emmerson Mnangagwa was “totally ignorant” about tackling Zimbabwe’s economic problems.

Commenting on his Twitter account, Hanke said the Zimbabwe dollar had lost value by 93% against the United States dollar since reintroduction as the soul medium of exchange for domestic transactions in 2019.

In the past few weeks, the domestic currency has also received its worst battering on the parallel market where it has been trading at rates of up to US$1:$180.

The official exchange rate on the foreign currency auction system is about US$1:$88, but businesses requiring foreign currency to import critical requirements have been failing to access the forex on the official market.

Hanke blamed the government for the runaway parallel market exchange rate.

“Corrupt @edmnangagwa brought back the Zimbabwean dollar two years ago. Since then, the Zimbabwe dollar has depreciated by 93% against the mighty United States dollar. President Ed is not only corrupt but, when it comes to economics, he is totally ignorant,” Hanke said.

Hanke’s comment came after prices have rocketed in the past few weeks, with inflationary pressures returning to haunt the southern African country.

Hanke said threats by government to suspend businesses that have been blamed for dabbling in parallel market activities will backfire.

“Zimbabwe’s currency is in a death spiral. Now, the corrupt government is threatening to suspend all businesses using black-market exchange rates to price goods. I’ve seen this movie before. It has a tragic ending,” he said.

But Information deputy minister Kindness Paradza said: “Actually as a government we cannot respond to an individual’s opinion, we have our own course which we are charting, which will see our economy getting back to normal as per our programme, so we cannot listen to personal opinion.”

Confederation of Zimbabwe Industries (CZI) — the largest representative body for local business, warned this week that the country’s currency was in danger of collapsing as businesses resorted to United States dollar transactions.

Zimbabwean authorities have in recent weeks arrested business leaders accused of manipulating the volatile Zimbabwean dollar by charging goods using a parallel market rate.

CZI cautioned the government against clamping down on firms and traders.

Follow Fidelity on Twitter@FidelityMhlanga

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