Today, the nation was shocked at the gazetting Statutory
Instrument 142 which basically reintroduces the Zimbabwe dollar, even in the
absence of addressing the economic fundamentals to support the local currency.
Despite government’s promise that it would introduce a new
Zimbabwe currency in the next nine months while it addresses the fundamentals,
the regime today just ambushed the nation and reintroduced the Zimbabwean
dollar as the only legal tender in local transactions. This means that the
multi-currency regime, which provided some modicum of decency and
predictability, has been thrown out of the window in favor of the volatile
local currency that is not backed by adequate gold and foreign currency
reserves.
In spite of SI 142, it is important to state that trust and
confidence, which any transacting public must have before they use a currency,
cannot in themselves be gazetted.
Today’s decision shows the lack of coherent, prudent and
predictable policy, which is important to retain trust and confidence in a
country’s economy. Policy consistency and predictability are key tenets for any
economy to succeed.
It remains to be seen how the market will respond to the
madness, but the knee-jerk monetary policy introduced in the dead of the night
is reminiscent of the rushed decisions of this regime. The fuel price increases
announced by Mr Mnangagwa himself in the dead of night and that caused a furore
in the country’s economy are a case in point.
With the current madness in government, it is important to
state that the people reserve their right to express their displeasure at the
free-falling economy and the knee-jerk policies that those in authority
introduce when they so wish.
Luke Tamborinyoka
MDC Deputy National Spokesperson
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