AMH is an independent media house free from political ties or outside influence. We have four newspapers: The Zimbabwe Independent, a business weekly published every Friday, The Standard, a weekly published every Sunday, and Southern and NewsDay, our daily newspapers. Each has an online edition.

Of currency bloodbath, failing economy and general elections

Opinion & Analysis
Mthuli Ncube, Minister of Finance and Economic development

This was a hectic week. The first full week after President Emmerson Mnangagwa proclaimed the general election date as August 23, 2023. Foreign currency exchange rate has gone bonkers, prices of basic commodities have shot through the roof and the citizens’ groaning is becoming louder, and the government is in panic.

There was bloodbath at the central bank’s foreign exchange auction on Tuesday. The local currency fell from $2 500 to $3 600 against the United States dollar in seven days. Twenty-four hours later, the Reserve Bank commenced the interbank auction system. The rate by banks was startling, the Zimbabwe dollar further fell to $4 800 to the greenback. In simple terms, the rate of exchange nearly doubled and the price of goods in shops skyrocketed.

For the uninitiated in economics, it means someone needs double the amount to buy the same grocery they bought last week. It means workers have either to halve their requirements or somehow have their salaries doubled to meet their requirements. They have become the working poor, a keg for social instability.

The central bank, in an attempt to placate business, has liberalised the foreign exchange rate. It further implemented the deregulation of the forex market. Importers can use their money as they wish. It will definitely reduce the crimes by foreigners trying to externalise the greenbacks as they can now do it formally.

The 2023 budget was crafted on the assumption that the ZWL/USD rate would be 950:1. This has been busted. The budget as it stands needs a review and hopefully the Finance minister will do that in his midterm statement. However, it is very unlikely that the minister will present a supplementary budget. A supplementary budget with less than 50 days to the general elections will further dent the government’s chances of re-election.

To further compound the political waters, Saviour Kasukuwere has announced his intention to contest for the office of the President in the general election. Kasukuwere's entrance changes the electoral landscape and his grand entry has gone viral on social media.

Academic Ibbo Mandaza tweeted: “Kasukuwere is the proverbial cat among the pigeons: he will divide the Zanu PF presidential vote, and perhaps even fatally dent Mnangagwa’s chances."

Kasukuwere is a former central intelligence officer, Zanu PF political commissar and held several Cabinet portfolios before the coup against Robert Mugabe in November 2017. He is one of the G40 kingpins currently exiled in South Africa and Kenya, among other places.

Kasukuwere has extensive business interests and links with the business sector. His ambitions are not only a fantasy.

Zimbabwean politics has had tribal connotations, whether perceived or not. There are tribes that since independence in1980 feel aggrieved that they have not eaten cake so to speak. Their communities still remain remote without services, they have not been employed in the public service and very few of them have been appointed to influential positions.

These grievances are real, especially with the perception that Mnangagwa has surrounded himself with his clansmen. The Zezuru tribe that is mostly found in Mashonaland provinces feels aggrieved and it is possible they will back their own and still have to revenge for the manner Mugabe was forced to step down.

Tribalism is not new in African or European politics. It is prevalent in east Africa, especially Kenya. It can also be discerned in west Africa, particularly in Nigeria. The majority tribes always decide the President – old and incompetent – so long it’s their horse.

In the UK, able Ex-Chequer minister David Brown lost as a Labour leader because he was Scottish. It is queer but that is the reality of politics.

Hopefully, Zimbabweans especially their leaders learn this lesson sooner. They need alliances on ideological and ethnic lines if they ever want to snatch power from Zanu PF. With all its incompetence, Zanu PF by hook and crook has “won” polls since 1980.

It is conceivable that Mnangagwa has been strengthened by recent presidential election results from Nigeria and Turkey. In Nigeria, Bolah Ahmed Tinubu at 70 still shocked the young voters who thought Peter Gregory Obi had won. Tinubu’s win came despite the economic chaos in Nigeria, especially fuel shortages and higher prices at the pump despite the country being one the largest oil exporters.

In Turkey, Recep Tayyip Erodgan shocked the Western world when he was re-elected despite the opposition having been tipped to win. Turkey held elections during economic malaise and most thought it would sink his leadership.

Back in Zimbabwe, Mnangagwa has not had a backlash yet. However, at the moment he holds two aces in his hands — the Private Voluntary Organisations Bill and the Patriot Bill which await his signature. The two Bills, if signed into law, will shrink the democratic space and put a lot of hurdles in the opposition's way to win elections. It stands to be seen whether he will continue to hold these Bills as the sword of Damocles over the opposition and civil society.

However, what seems certain is that Mnangagwa is toying around with a scorched earth policy or playing a zero-sum game. Mnangagwa has the mentality that if he sinks, he will drown with the country. A very dangerous game considering the haemorrhaging the economy is going through.

Whoever wins the presidency, the country will need a lot of reconstruction and a shift of the mindset. Zimbabwe should have space to breathe and think of the future rather than only the here and now as being exhibited by the present regime.

Between now and August 23, there are lots of twists and turns that may happen. Even the idea of a coalition government may come to the table, but that remains far-fetched for now as the political hounds smell blood.

Related Topics