Zimbos struggle to show love for local money
LAST Thursday, my liberal team and I sampled a few of our country’s top economic analysts on a Zoom conference on Zimbabwe’s precarious currency conundrum.
Of course, one cannot make objective conclusive judgment premised on a two-hour debate.
Even with my minuscule knowledge of North Korean, Burundi, Venezuela, Libyan, Syrian, Siberian or Cuban economies, participating Zimbabweans turned out to be citizens who have a passionate, incorrigible hatred for their currency.
We conjured a conference topic, mischievously drawn from the “Even God cannot sink the Titanic” analogy, which tragically ended up at the bottom of the Atlantic Ocean in April 1912.
Local money pundits insist the Rhodesian-turned-Zimbabwean dollar counted among the elite currencies of Africa – only up to perhaps 1990.
Economists Vince Musewe and Christopher Mugaga hardly concur on what would restore it to that altitude of former glory. It would be a catastrophe of unimaginable proportions if economists agreed on anything, anyway!
I follow Steve Hanke’s writings who routinely argues for mothballing of central banks in favour of monetary policy committees.
Yet trade unionist Peter Mutasa insists the solution lies in government fulfilling its policy commitment to a new social contract towards an inclusive economy. Musewe, like most participants, contends Zimbabwe’s malady stems from a leadership crisis, not currency crisis, advocating for a new generation of captains with reformative predisposition towards high export-led productivity. Only to restore local currency reserve value.
However, Mugaga dismisses Musewe’s gold-backed currency proposition in preference to a drastic reduction in money supply, supported by private sectorled growth.
The billion-dollar question for me is not so much about the value of the Zimbabwe dollar as it is about our hatred for it. I have spent 30 years of my adult life crisscrossing Africa for a liberal cause; and have seen with my own eyes the value of shilling, kwacha, naira, metical, birr and rand tumbling; yet East Africans, Zambians, Nigerians, Mozambicans and Ethiopians tenaciously cling to the their beloved currencies.
In 2008, the Reserve Bank of Zimbabwe under the politicised governorship of Gideon Gono, unleashed billions of “funny money” to appease the late President Robert Mugabe’s political gluttony. By the time Finance minister Tendai Biti officialised the United States dollar in the government of national unity, Gono’s “agro bills” were on a trillion percent hyperinflation trajectory.
Today, iceberg-bound Finance minister Mthuli Ncube and his “lost at sea” governor John Mangudya are twin coxswains on Zimbabwe’s fateful epic currency journey.
Worse still, my country’s economic lighthouse refracted in the distant haze of political misdemeanours.
No wonder Ncube and Mangudya’s monetary policy antics attract nothing but collective national scorn.
My Zoom panellists concluded that without relentless local production, strong independent institutions, national confidence, respect for property rights and a drastic change in leadership mind-set, Zimbabwe’s hated titanic “Zimdollar” is headed one direction – to the bottom of the fiscal and monetary icy ocean.