Saturday, 20 June 2020


THE pressure is mounting on under-fire Finance minister Mthuli Ncube, with Members of Parliament challenging him this week to fix the country’s comatose economy or resign from his Cabinet post, the Daily News reports.

 This comes as Ncube has effectively moved to partially re-dollarise the economy, after he awarded restive civil servants and pensioners US dollar allowances — in addition to increasing their Zim dollar emoluments by 50 percent.

 It also comes as some shops are beginning to reject payments in the local currency, following the spectacular crash of the Zimbabwe dollar against major currencies on the parallel market — amid the country’s hyper-inflation and ever skyrocketing prices of basic consumer goods.

 On Thursday, Parliament asked the under-the-cosh Ncube to make a ministerial statement on the challenges affecting the economy — with legislators such as Tendai Biti also asking him to resign from his Cabinet post.

“I made the directive that the minister (Ncube) must come to address this august House on the economy of this country and all pertinent issues that affect the Members of Parliament will be raised during that interface,” the Speaker of the National Assembly, Jacob Mudenda, said.

Biti, the former Finance minister in the stability-inducing 2009 government of national unity (GNU), went further — raising a point of privilege demanding the resignation of the Treasury boss.

“In June of 2019,  Speaker Sir, we were advised by the esteemed minister of Finance that the country had de-dollarised … that the regime of multiple currencies were no longer legal tender in Zimbabwe … that the Zimbabwean dollar had been restored as the sole currency in this country.

“We made the point that conditions did not exist for the introduction of our own currency.
“It is our contention … that the minister of Finance owes Zimbabweans an apology … that he should not introduce dollarisation through the back door … that he should repeal Statutory Instrument 33 and Statutory Instrument 142 and the Finance Act.

“Speaker Sir, the minister of Finance has failed in absolute terms and must resign,” Biti — who is the MP for Harare East — said.

 Earlier on Wednesday, Ncube was also told of how some supermarkets were now rejecting local coins and $5 bond notes — with Zanu PF proportional representative MP Perseverance Zhou telling the august House that many people in his area were among those having problems trading in the local currency.

“I have brought the money for ease of reference. In my constituency in Zhombe at Empress, Hove and Chidhakeni shopping centres, parents are having a difficult time because retailers are refusing to accept some notes … they want new notes only.

“Does the minister know this?” Zhou asked Ncube — to which the Treasury boss said people were free to swap bond notes for the new notes.

“I am requesting all of those who have had these experiences, where their bond notes have been rejected, to approach banks and surrender those notes in return for the newly-issued notes … so that we just do a swap.

“What should happen is that people should be able to approach the Reserve Bank of Zimbabwe and then have those bank notes replaced with fresh notes … Just bring them over and we swap those,” Ncube said.

 However, Zhou insisted that the government needed to come up with policies that prohibited retailers from refusing the country’s notes.

“They (the shops) are the ones who are supposed to accumulate these notes and take them to the Reserve Bank.

“That is hard-earned money and yet people are told to go to the bank again to swap those notes.

“People do not have money for transport. What policy does the government have in place to solve this problem?” Zhou further asked Ncube.  However, the Finance minister went on to tell the National Assembly that it was not true that some shops were refusing to accept the Zim dollar.

All this comes as the country’s economy is rapidly approaching the horrors of a decade ago when the Zimbabwe dollar was decimated by hyper-inflation — with the prices of most basic consumer goods now out of the reach of the majority of ordinary citizens.

The country’s worsening economic rot has also triggered restlessness among Zimbabweans.

 Despite being feted like a king when he first replaced the late former president Robert Mugabe, via a popular military coup in November 2017 — President Emmerson Mnangagwa and his government have found re-building the broken economy a tough ask.

 On Wednesday, the government surprised many people by deciding to pay its workers and pensioners allowances in US dollars, in a move which had similarities with how the then administration of Mugabe introduced the stability-inducing multi-currency system in 2009.
 Then, Zimbabwe binned its worthless currency and introduced the multi-currency system which was anchored by the US dollar.

 Despite this system having served the country well for more than a decade, Ncube rattled the markets in June last year when he prematurely and ill-advisedly ended the local use of the US dollar and other foreign currencies.

 He directed at the time that the Zim dollar be the sole legal tender in the country, without addressing the root causes of its crash and subsequent decimation by hyper-inflation in the run-up to the consummation of the 2009 GNU. Daily News


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