ON Tuesday, the Finance and Economic Development ministry and the Reserve Bank of Zimbabwe, announced new economic measures meant to stall the country’s current untenable state of affairs characterised by three-digit inflation that has goaded prices to unreachable levels for the majority of Zimbabweans.
The rising prices of goods and services have resulted in the local currency, prematurely birthed in 2019 with insufficient immune boosters in the form of forex reserves and national confidence, suffering chronic seizures. And pitted against other stronger currencies such as the United States dollar, the Zimbabwe dollar has proved no match resulting in both private and public workers clamouring for greenback salaries to at least afford a decent living.
“The market lacks confidence that the multi-currency system is here to stay for the foreseeable future. To eliminate speculation and arbitrage based on this issue, the government has decided to embed the multi-currency system and the continued use of the US dollar into law for a period of five years,” Finance minister Mthuli Ncube told the nation when he announced his new measures which mean that government has buckled to pressure to redollarise the economy.
While the government appears to have realised and accepted that the die has been cast, it is critical to again remind government that half-hearted and piecemeal measures will only serve to prolong the country’s economic misery.
By reintroducing the multi-currency regime, which – for those who still remember, was first announced in 2009 when the old Zimdollar was mauled to death by a monstrous 500 billion percent hyperinflation, what exactly is Ncube saying?
Is Ncube telling us that the Zimdollar is part of the new basket of multi-currencies? If it is, then we are afraid to say, maybe acting as loose change the local currency may still have some life left in it. However in the long haul the currency will simply lose relevance.
It, therefore, means the multi-currency regime which Ncube hopes will last the next five years will, unfortunately not include the local currency. Including the Zimdollar in the multi-currency basket is a lame measure because the generality of the population, including government itself, no longer have faith in it.
What is most saddening is the fact that this was not the only half-hearted measure government announced on Tuesday. Everything else it told us, such as the so called loans to civil servants, were just smokescreens for failed economic measures.
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For instance, how can government offer loans with one hand and with the other hand extend a punitive 200% interest rate on the very same loans? What kind of policy measures are those? What kind of economic tomfoolery is this?
Why is the Zanu PF government taking us for such fools to accept such ignoble nonsense of economic measures? The writing is on the wall; Zimbabweans have been there before and they would be the worst fools in the universe to be taken for a ride by such misguided policies.
Government must simply go back to the drawing back and try again, fast.