HomeAnalysisTime to prove critics wrong

Time to prove critics wrong

Since taking over power from long-serving former president Robert Mugabe under circumstances which we are not going to delve into, lest we, in David Copperfield’s words, “meander” into other matters we had not hoped to be the centre of this week’s installment, President Emmerson Mnangagwa has made all the right noises since his inauguration last year. He has instituted some bold reforms by Zanu PF standards such as the disbandment of the indigenisation policy and instituted some economic reforms.

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Notable reforms centre around trimming a bloated civil service, cutting the sizes of delegations on foreign trips and general austerity measures, something that could not be imagined under Mugabe’s rule. And he has scored some successive public relations coups with impromptu hospital and church visits, and the old mercedes benz he is using.

He has also set the tone for his government with a 100-day plan, which will hopefully provide a benchmark assessment of cabinet ministers’ performances against set objectives and his performance incidentally as well. His fight against corruption is also quite popular after his predecessor paid lip service to dealing with the vice.

Mnangagwa has won over everybody, including the Americans.

In an article for the Harvard Business Review titled: What Investors Need To Know After Mugabe, Anna Rosenberg and William Attwell, analysts at the Frontier Strategy Group, say Mnangagwa’s policy pronouncements inspired confidence among foreign investors.

“For companies willing to take on some risks, now is the time to buy local assets, which, though priced in US dollars, are still fairly cheap because of the associated risk,” reads the Harvard Business Review article.

“As Mnangagwa’s reforms begin to gradually stabilise the economy, significant opportunities will emerge across an array of sectors and segments — both formal and informal — for companies hoping to expand in this relatively under-served, but high-potential market. Mnangagwa’s first actions in office underscore how important he views economic recovery.”

But after all the reformist, likeable guy and public relations goodwill has ended that the Mnangagwa administration is currently enjoying, the electorate will once again start asking the hard bread and butter questions again.

Where are the jobs and the investors? Where is the cash at the banks? Is that an agreeable rate for the US dollars initially deposited in banks? Why is the bond’s value discounted against the United States dollar and how much in Real-Time Gross Settlement’s balances did the central bank create? So far, there is no convincing plan to restore confidence in the economy and genuine support of the value of the bond against the US dollar. And the market is overflowing with liquidity coming from the central bank.

Against such a background, any attempt at populist moves which do not address fundamental macro-economic challenges will just backfire. Now is the time to walk the talk and prove critics wrong. Until credible economic reforms have been instituted, the plans by the Mnangagwa administration will remain just that.

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