HomeLettersEditor's Memo

Editor’s Memo

Gono’s test

I AM becoming more than a little irritated with the naivety of newspapers claiming that Gideon Gono’s purge of the fin

ance sector is a panacea for the country’s myriad woes. We are faced with a national propaganda campaign, orchestrated by the government, and dutifully parroted in the official media that Gono’s crackdown is about to turn the economy around and set the country on the path to salvation.

Of course only the most delusional observers of the national scene would swallow such nonsense which Gono himself has been careful not to endorse. He has made it plain what obstacles he faces.

But still, day and night, the relentless propaganda offensive continues to insist that Gono is some sort of messiah leading the nation to the promised land.

In none of this are we told how the country got into the current mess in the first place – apart of course from the dishonest claims about sanctions. In fact the economic pattern of the past seven years has been entirely consistent. Zimbabwe’s slide began in 1997 with the devastating impact on the budget caused by President Mugabe’s award of over $4 billion to war veterans and the announcement of a programme of land seizures. The following year saw the intervention in the Congo and the terrible drain on resources, including scarce foreign exchange, that campaign entailed. The IMF, impatient with the deterioration in budgetary planning, began to see Zimbabwe as a hopeless case.

The economy was therefore already in trouble well before the land invasions of 2000. A pattern of borrowing and spending was already fuelling inflation, lenders were bailing out, and macro-economic distortions becoming entrenched. The ill-conceived and violent land grabs simply compounded existing problems and put the country off-limits for investors.

So the EU’s ban on President Mugabe’s trips to European capitals can hardly be held responsible for the current decline.

Much has been made of the fall in the consumer price index from 619,5% to 598,7%, a decline of 20,8 percentage points. Some newspapers understood this to mean a fall of 20,8%. In fact a fall of 20,8 as a percentage of 619,5 is 3,36%. In other words we have been celebrating a 3,36% fall in inflation as if our problems were nearly over. Is that really the best we can do?

This Pollyanna approach to journalism is unhealthy. Journalists should be reasonably sceptical of all patent medicines, especially those offering a complete recovery!

Gono has not helped his own cause by allowing the ruling party to hike a free ride on his bandwagon. If he is to retain his credibility as a broom that sweeps clean he will need to prevent discredited elements from claiming he is their man. Ideally he should be his own man in all this. And, as we have said in today’s editorial, that will entail tackling the Augean stables of the public sector with the same gusto he has shown in the private sector.

The foreign exchange market, for instance, doesn’t stop at the borders of the state-owned companies. What is the point of imposing order in the finance sector if public-sector corporations can go on distorting the macro-economic picture by draining the fiscus?

I think we can safely dismiss the current plot against the Reserve Bank boss currently being bandied about in the state media as yet another fictional distraction. Gono is an accomplished banker. That is all we need to know. If he has a weakness it is that he has allowed himself to be rather too closely identified with those in power. But he will be judged on how well he undertakes his current mandate. If there is a plot against him it is about as credible as all the other plots emanating from official sources!

Gono must be allowed to get on with his job unmolested. But it must extend beyond the narrow confines of finance-sector discipline. He needs to say what has to be done to stabilise the economy at a more general level in order to underpin monetary policy and restore relations with the international community. That will be the real test of his mettle.

Recent Posts

Stories you will enjoy

Recommended reading

You have successfully subscribed to the newsletter

There was an error while trying to send your request. Please try again.

NewsDay Zimbabwe will use the information you provide on this form to be in touch with you and to provide updates and marketing.