'Zim govt incurs credibility deficit'

HARARE - Government is running under a serious credibility deficit, as the long-suffering Zimbabweans continue to lose hope in its economic policies, analysts have observed.

The four months preceding the July 30 elections have been a perdition to Zimbabweans after the August 1 army killings of innocent civilians on the streets of Harare resulted in President Emmerson Mnangagwa’s administration squandering all the goodwill that it had accumulated upon assuming the reins of power from former president Robert Mugabe.

Since then, the economic wheels have come off the rails in what is turning out to be another version of the 2007/08 crisis that resulted in government ditching its own currency in early 2009 after it had lost its value due to hyperinflation.

The country’s economy has been in the throes of shortages of basic commodities, and vexatious price hikes since September.

To make matters worse, industry has been brought down to its knees owing to fuel shortages, and creeping inflation which is eroding salaries and the little savings in the financial system.

A survey by Daily News on Sunday Business showed that the majority of ordinary Zimbabweans have lost confidence in their government.

In an interview, Steve Hanke — a renowned currency and economic expert — said economics and politics were interrelated, and that each creed cannot be looked at in a vacuum.

The country has been weakened by numerous economic disasters that have left the populace shipwrecked.

Analysts have argued that Zimbabwe’s case is more of a political deficit sullying the economy.

While Mnangagwa has made discernible strides to stop corruption, his government has been chastised for cosmetic approaches to the cancer and other economic issues.

This has further reduced credibility of the noble intention.

While the Finance ministry has vouched to reduce government’s perpetual expenditure due to Zimbabwe’s mammoth debt that runs into billions of dollars, government’s insatiable appetite to spend on meetings and some luxurious trips still looms large.

This also comes after government has been castigated for its warped priorities, including building a new luxurious Parliament and purchasing top-of-the-range cars for its bureaucrats while hospitals are dilapidating.

It has also been castigated for choosing to pamper traditional chiefs with goodies while doctors are on strike.

Former Finance minister Tendai Biti was recently quoted saying that the Zanu PF government, from Mugabe’s time, has always had an insatiable appetite for goodies, which has amplified debt for the past few years.

In April this year, the Daily News on Sunday’s sister paper reported that Mnangagwa hired a private luxurious Swiss jet on his State visit to China blowing $2,3 million, while another report cropped up in November, the same year, that he hired the same plane on another visit to Guinea.

Economist Simbarashe Gwenzi said the prevalence of foreign currency shortages amid other challenges erode confidence due to the painted picture of uncertainty.

“It is indeed true that public perception erodes in times of uncertainty. We are experiencing cyclical challenges, coupled with an expanding economy putting pressure on the foreign exchange (forex) allocation matrix which is inefficient and ineffective,” said Gwenzi.

“The bottlenecks in the flow of forex to the critical areas; poor communication strategy on the part of government definitely erodes confidence. On the political front, dialogue between the two leaders of the main parties ought to bring stability and improve political risk that’s affecting increased investment by both domestic and foreign investors,” Gwenzi said, while importing on nemesis Mnangagwa and main MDC leader Nelson Chamisa to smoke a peace pipe.

Many economists have said dollarisation is the only answer out of this economic quagmire but government has resolved to follow the path of a Transitional Stabilisation Programme (TSP) which it says will stabilise the economy.

This has precipitated many calls for a unity government as many people fear that Mnangagwa’s government will not be able to raise the economy from the doldrums alone.

Businessman Shingi Munyeza tweeted on his Twitter handle recently that government needs to bring back credibility and confidence by making the August 1 inquiry into the army killings public, expedite all cases on corruption, allow the selling of fuel in United States dollar and open up fuel importation for those who can.

He said government must come to the realisation that the US dollar is not at parity with the bond note, and also called for the opening up of dialogue between Chamisa’s party and Zanu PF.

Speaking at the Zimbabwe National Chamber of Commerce Business Review Conference recently, the president assured the business community that he is in the process of constituting an Economic Advisory Council in the Office of the President that will assist him to steer the economy to achieve the TSP vision 2030.

Political analyst Maxwell Saungweme told the Daily News on Sunday that too many promises have been made and so far government under Zanu PF is already failing to deliver as promised

“It is true a lot of careless and vacuous promises were made by both opposition and Zanu PF. Now that Zanu PF is in power people expect them to make good their promises but that is not coming.

“Credibility deficit has been characteristic of former President Robert Mugabe’s epoch and Mnangagwa inherited and perfected the same,” Saungweme said.

While some bemoan the loss of elections by MDC Alliance saying the party could have changed lives in Zimbabwe, others remain sceptical of both parties probing MDC’s policy contribution during the Government of National Unity between 2009 and 2013.

Analysts have argued that Mnangagwa’s government is a simple extension of Mugabe’s rule, citing that the two former allies still have much in common.

An academic and analyst from the University of Johannesburg Pedzisai Ruhanya said there has not been institutional and structural governance change in the architecture of Zimbabwe.

“Deal with the parasitic network, patronage, personalisation and family links governing the State, and the culture of impunity over accountability which still runs in the regime.

“The rotten system in Zanu PF and the liberation war heroes who give themselves entitlement to loot resources and make decisions because they fought the liberation struggle is disheartening.

“Mnangagwa has failed to transform and to reform the nation and what they are doing is lipstick reform and we are simply repeating 2008 in 2018, he talks but does not walk the talk. He is now exposed, how can Zimbabwe be open for business with fuel shortages?

“The bond note currency is not traceable on the market, and US dollars can never be the same just like donkey meat and beef in Zimbabwe,” said Ruhanya.

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Comments (4)

vhekishesiyasi price hikes ???....Inga urishasha.. Chirungu chakanaka kana chakareruka hachirare. Mabasa anofanira kuwanikwa munyika.

Ndechevaridzi - 16 December 2018

My hope is that the economy will improve after six months from now. It is when some policies will start to show its indications and respond in our economy.It is unfortunate that people are expected to see the positives of our economy now where the oppositions of ruling party are spreading news of worse economy that is coming.Zimbabwe must focus mainly on Bond notes stability,foreign currency creation by way of export ,restrict luxury import, cut gvt expenditure, allow all our hotels charged in forex and promote incentives on imports cut on raw materials that can be sourced local.Six months from now the economy will be on its stability due to some of economic indicators that are more to positives than to negatives that is a sign of economy expansion. If all those economy indicators stayed on positive side without any disturbance for the next six months, gvt is going to meet it targets on its expenditure cut, boost its fc reserve and its development.Yes we need a better Zimbabwe by yesterday,Yes we need a better living by yesterday but my hope is Zimbabwe is going to change for better.

Hope - 17 December 2018

We have a failed banker as our Minister of Finance, so expect more problems.

citizen - 18 December 2018

@ Hope, keep hoping. ED is even worse than Mugabe. Things will get worse.

Chikowore - 19 December 2018

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