ZIMBABWE’S worsening economic situation has reportedly ratcheted pressure on President Emmerson Mnangagwa from within his ruling Zanu PF party to find quick solutions as the country heads into the election season.
The spectre of the grim 2008 era defined by hyperinflation
is looming large in the southern African country after the year-on-year
inflation shot up to 191,7% in June from 131,7% in May according to the latest
official figures.
Price increases have become a daily occurrence, leaving desperate
workers unable to cope as wages and salaries fail to keep pace.
A panicked Mnangagwa promised on Friday to announce fresh
“concrete measures to tame inflation, and unwarranted increases towards
securing the incomes and savings of our people, especially women”.
He said this while officially opening Zanu PF’s 7th
national women’s league congress in Harare.
Mnangagwa appears stumped, unable to deal with the
rampaging inflation or halt the slide of the local currency against the United
States dollar.
Finance minister Mthuli Ncube is likely to announce the
measures at a Press conference this morning.
On the parallel market, the rate was US$1:$650 at the
weekend, compared to $360 on the official market.
Party organs are reportedly increasingly becoming restless,
worried that the economic meltdown could cost the ruling party dearly in
elections expected next year.
There are also strong indications that the Cabinet is
sharply divided over how to deal with the situation, with some ministers
calling for dollarisation, while others are advocating for the status quo to
stay.
Big wigs in the party are also reportedly piling pressure
on Mnangagwa to reshuffle the Cabinet and fire some ministers they accuse of
sabotaging his vision of a middle class population by 2030, insiders said.
The Zanu PF women’s league on Friday implored Mnangagwa to
put in place stringent measures to stem corruption that now infests his
cronies, which has emerged as the major force bleeding the economy.
“My President, we want you to introduce stiffer penalties
against perpetrators of corruption by even cutting one finger, if not two,”
women’s league secretary Mabel Chinomona said at the conference.
At a Press conference recently, Zanu PF youth national
secretary for administration Tendai Chiwetu said he was aware of ministers and
legislators who were working against Mnangagwa.
“We have people who seem to like President Mnangagwa, but
they don’t like him. We are going to make sure that they don’t retain as
central committee members as we approach the elections,” Chiwetu said.
Mnangagwa has previously attacked “saboteurs” for the
economic malaise.
Last month, he announced a raft of measures aimed at controlling
the spiralling inflation, which included a ban on bank lending, but the
measures boomeranged and forced government to backtrack.
Economists attributed the current economic mess to poor
monetary policies and fiscal policy failure, insisting that dollarisation was
the only way to forward.
“There is no room for other economic measures to rescue the
economy other than dollarisation. Owing to this ever rising inflation, the
minister (Ncube) may need a supplementary budget, but with what currency? Is he
prepared to use the local currency, we will have a $2 trillion dollar budget
because naturally, if you look at what has been happening, the official
exchange rate has tripled from December last year yet the budget did not take
into account of that,” economist Gift Mugano said.
“Expectation was that by the end of the year, the official
exchange rate would be around 200, but now it’s already 350. As we get to
December, the rate would be above 500.
“So government is in no capacity to put any measure to tame
inflation other than dollarising. It’s a raging fire. Economic agents are
restless. Whatever is happening in the economy is self-fulfilling.”
Political analyst Sydicks Muradzikwa described Mnangagwa’s
efforts to resolve the economic crisis as “political rhetoric”.
“The economic fundamentals that are prevailing cannot be
addressed by political gimmicks. He has to make sure that he implements genuine
political reforms. There are outstanding key political issues that are
threatening to tear this economy apart,” he said. Newsday
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