Comment: Gono’s Complex Mind

RESERVE Bank governor Gideon Gono is reported to have said he is ready to leave office if anyone wants his job.

 

He disclosed this at a field day at Chief Fortune Charumbira’s Acton Farm in Masvingo.

“I am even looking for an excuse, I do not need much effort to be pushed out,” he said. “If anyone wants to take my job, let them come forward.”

This should have been music to the ears of those Zimbabweans who this week spent hours in queues waiting for cash at banks after the withdrawal threshold was raised to $20 000 on Monday. While Gono has invited those who want his job to come forward because he is ready to leave with the least of bidding, it does appear that in reality he has become immune to growing exhortations to quit. He should have been among the throngs outside banks this week to hear who the public hold responsible for the mess.

No one wants his job because it is tantamount to receiving a poisoned chalice, which we warned him about when he took office in December 2003. But depositors, many sleeping in the queues, believe that he is the root cause of their misery.

Those who have followed his performance as Reserve Bank governor since his appointment in 2003 have their daggers drawn but appear reluctant to tackle the formidable foe. Gono is digging in and is not acting like a man going anywhere soon.

He came into office vowing to clean up the banking sector in which many banks had forgotten their core business and were risking investors’ money in speculative investments. Despite accusations that Gono used a sledgehammer to swat a fly, including being vindictive in his handling of certain financial institutions, at least he managed to restore some semblance of order.

But the chaos manifesting itself in the cash crunch at Christmas appears to be returning once again. Gono also came into office promising to fight inflation, which he declared to be the country’s Number 1 enemy. He famously declared that “failure was not an option” in that war. He was also sold to the nation as a most able turnaround strategist after the almost miraculous resurrection of the then Commercial Bank of Zimbabwe where he was chief executive officer.

At the time of his declaration of war the inflation rate was 621%. Today at 11,2 million percent people have stopped looking for adjectives to describe it, except as another world record for Zimbabwe!

Gono has said we are living under extraordinary conditions and it is therefore not a time for textbook economics when rebutting those who tell him it is ill-advised to print money to meet excessive government spending or that he is straying from the core business of the central bank by engaging in quasi-fiscal activities.

In his speech in Masvingo this week, Gono let us into a bit of the complex operations of his mind. Sounding like he had just dropped in from Mars to see for himself what has been rumoured as Zimbabwe’s economic collapse for nearly a decade, Gono remarked: “Zimbabwe’s ancestors are strong. It is surprising to see our economy standing by now.”

Then apparently angry that the economy was still “standing”, Gono said he would continue to print money, maybe to spite those who believe his policies have failed and that he should call it quits.

“I’m not afraid to print money and I will continue doing so until those who imposed sanctions on us (the West) have lifted them,” Gono said.

No doubt even his most ardent supporters must have cringed at this. It is difficult to see how a Reserve Bank governor who continues to print money and then thanks the “ancestors” for saving the economy can win the war against inflation, let alone achieve an economic turnaround.

The least anyone would have expected of Gono was for him to repeat the Zanu PF rhetoric about sanctions and the need to fund agricultural recovery under a cash economy.

The Zimbabwean economy is still standing not because but despite disastrous printing of money. The Zimbabwean economy is still standing not because of “strong ancestors” but because a strong foundation had been laid long back to withstand the most brutal buffeting by the storms of President Mugabe’s unplanned and badly executed land reform programme.

It is that foundation of the economy, commercial agriculture, which needs to be rebuilt before Zimbabwe can reassert its role as the regional breadbasket. So far Gono’s efforts to reduce inflation and achieve an economic turnaround have failed because he has been tinkering with the symptoms and forbidden by his “principals” to address the macro-economic fundamentals.

People expect Gono to be telling them that the madness of the past few years is finally coming to an end. He should be preparing to cede the vast powers and a myriad other responsibilities the central bank acquired during the years of madness to a properly constituted government. The least that this nation expects at the moment is Gono promising us more of the same.

 

 

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