Reserve Bank of Zimbabwe (RBZ) governor John Mangudya yesterday spelt out the three big problems he thinks the country is currently facing.
Zimbabwe Independent Comment
He listed them as: a current account deficit; lack of fiscal space; and lack of access to foreign finance. After listing the top three challenges in his considered opinion, he went on to attribute the lack of access to foreign currency to two factors: Zimbabwe’s debt overhang and economic sanctions imposed by Western governments.
Well, Mangudya is an economist. But with all due respect to him, Zimbabwe’s biggest problem is failure of leadership and the attendant ruinous policies.
We can talk of economic reform until the end of time, but nothing can change in this country as long as political leaders continue destroying instead of building. Why are foreign investors not venturing into Zimbabwe in significant numbers? It is not because of climate change or bad luck. It is because of failed leadership and abysmal policies.
On the controversial bond notes, Mangudya has not been an effective communicator. While conventional economic prudence dictates that in order for a financial commodity to be consumed or accepted by wider society, the public must have trust and confidence in it, this has not been the case with the RBZ’s plan to launch bond notes.
The central bank calls the bond notes an export incentive backed by a US$200 million Afreximbank facility.
Worryingly, no attempts have been made to address underlying concerns which threaten to make the bond notes a failed project.
Lingering concerns and suspicion over the existence of the Afreximbank facility have cast doubt on the real quantum of the bond notes. So far, all indications point to unbelievable levels of confusion on the launch dates. First it was October. Now it is November. Even after hinting at November as the month the bond notes would be launched, it is clear that the central bank has not properly handled the publicity. There is a reason why Zimbabweans are apprehensive about bond notes. Mangudya knows the reasons. People lost life savings in this country and families were left in ruin. He needs to know that in order for any currency to be accepted by the eventual end users, the public must first have confidence and trust in it. These are two commodities that cannot be found when there is talk of a possible re-introduction of a Zimbabwean currency by any other name.
The RBZ needs to come clean on whether the bond notes are indeed backed by some sort of bond. In issues of public governance, nothing beats openness. Sunlight, after all, is the best disinfectant.
Of late, Mangudya has been lambasting journalists for asking tough questions. But the governor is a public figure and should not expect journalists to pamper him with sunshine journalism when the nation is agonising over such an important issue.
The journalism fraternity has a vital responsibility to ask the tough questions on behalf of the public. Public officials should see journalists as partners in the national project — not sinister elements or hired guns.