By Martin Tarusenga
IN all fairness this should go down as the most frustrating festive season Zimbabweans have ever had. Most people spent hours trying to get cash from
I was one of those who found themselves in one of the long queues that remain a common sight at all the banking halls in town.
I had summoned the courage to brave the pounding rains and queue in order to get my money. I just had to get the cash because I badly needed to buy basics. By basics I mean the essential things that feed and keep the body functioning properly.
On this particularly frustrating day I was wondering whether there was no time-efficient way of queuing in both the balance inquiry and the cash withdrawal queues at my over-crowded bank.
I was not sure about the amount in my account and therefore had to check the balance first. That of course meant that I had to join two queues. I resolutely joined the balance inquiry queue to check if the RTGS transfer made by my counterpart a week earlier was reflecting in my account.
Though pained by the many hours of queuing I found comfort in the fact that I was not the only one who was struggling to get their cash. There were thousands others who had thronged the banking halls dotted around the country in order to get their cash.
I had driven from my home to town but there were others from remote areas like Jerera Growth Point who had walked 20km to get their cash.
How frustrating could it have been to a granny who had spent hours in a queue trying to get money deposited by her son in Harare?
What about a retired teacher who had spent a day trying to get his/her $5 million pension pay-out from the National Social Security Authority?
All these possibilities made me sad but it helped me understand that mine was not the worst of situations.
With boredom creeping in I began chatting with others in the queue. There were people who had joined the queue at 6am. There were others who had been struggling to get their cash for weeks.
I needed cash to buy basics but there were others who had desperate needs like money to buy a coffin and feed mourners at a funeral.
Then there were others who wanted cash to transport their sick relatives from rural areas. There were still others with medical prescription notes. They badly needed cash to buy medicine. I can’t imagine what happened to those who are terminally ill. It was all desperate. It was sad.
And as I pondered the dim prospects of when I would be served I reflected on the events leading me to this time-wasting fiasco.
First the RBZ had announced the $200 000 notes would be rendered valueless on December 31.
The logic was that most of the $200 000 were held by barons who were holding on to cash to fund their parallel market deals.
In the meantime the price of commodities and services resumed their upward trend in earnest after government dismally lost the price-control battle.
My understanding, not backed by a thorough research though, tells me that most people were just not banking their money because once locked in the bank they would find it difficult to withdraw it. In other words people had lost their confidence in the banking sector.
The other explanation is that at the rate at which prices were surging there was bound to be a shortage of cash. People just needed more notes to buy fewer commodities.
I don’t know much about the cash barons’ theory but I am sure it is not the only cause.
From my chat with others in the queues I got to understand that generally people don’t want explanations as to why they are not getting their money. Instead they are more interested in getting their money and using it as they wish.
Withdrawing money should not constitute a day’s work for any sane person. If withdrawing cash takes the whole day then where will time for other productive operations come from?
In the current circumstances adequate cash to make purchases of even the essential commodities and services is not obtainable from the banks, hence the endless queues. The cost of such a crisis to a country’s economy is huge.
Given the service rate per customer at the enquiries service point, I estimate that I would be in that particular queue for at least 30 minutes and would be in the longer cash withdrawal queue for at least an hour assuming that the RTGS transfer had succeeded.
I estimated that I will be in the bank for roughly two hours. Going by the RBZ’s estimate which puts the number of bank retail customers at two million, an average aggregate over all bank retail customers of about four million hours of productive time is lost everyday that this cash crisis persists.
This translates to upwards of 400 days or upwards of one year of productive time lost in a day. Given that the queuing was the order of the day for about three months, about 60 years of productive time was lost on bank queuing during this time.
Given the national budget which stated that Zimbabwe’s GDP was $16 quadrillion one easily ascertains the real damage of this crisis on the economy.
The $16 quadrillion translates to US$10 million when using the Old Mutual implied rate. This GDP forecast translates to a per capita GDP of about $1,5 billion or US$970 assuming that Zimbabwe’s population is 11 million.
If it is assumed that the two hours that each customer lost each day of the last quarter of the year 2007 is a quarter of an eight-hour working day, then the whole country lost about 25 days of production in the last three months.
This would therefore mean that each customer lost an equivalent of 7% of their per capita GDP in the last quarter of 2007. When will we get the time to recover these losses I wonder!
* Martin Tarusenga is Principal Consultant of Systemics Consulting. Email Mtarusenga@aol.com tel 0912 889 716.