The banking sector — which plays a vital role in financial intermediation as well as other critical functions which collectively are the lifeblood of the economy — should be commended for presenting a detailed dossier articulating critical issues that must be tackled by the government without further delay.
Other business executives also did the same at a high-level meeting with President Emmerson Mnangagwa and government officials at State House on Monday.
Reeling from market turmoil and currency volatility eroding their balance sheets, earnings and savings, financial institutions say the government must urgently tackle the root causes of the country’s economic problems and not just tinker with symptoms.
No one can ignore bankers. Sitting at the heart of financial intermediation with aggregate deposits amounting to US$9,5 billion, banks have massive leverage and their voice on the economy matters.
As the Zimbabwe Independent has repeatedly advised, the multi-faceted crisis facing the country requires a comprehensive policy response, a practical implementation matrix, clear-cut timelines and the political will to carry through with the desperately needed economic and political reforms.
The banking sector’s intervention comes ahead of Finance minister Mthuli Ncube’s presentation of the 2019 national budget statement this month amid the intensifying economic implosion.
The minister has his work cut out: tackling deepening foreign currency and cash shortages; unsustainable high budget and current account deficits; rising inflation pressures; slow re-engagement process and arrears clearance strategy; infrastructure bottlenecks and poor social service delivery. Ncube, brought in to fix the broken economy, also has to deal with the unmanageable subsidies, especially on fuel and agriculture, and a series of austerity measures.
A document written by the local banking sector, submitted to Mnangagwa at the Monday meeting between government officials and business executives at State House in Harare, seen by the Independent this week, shows bankers are anxious about the current economic emergency.
Bankers say government must urgently rein in public expenditure to address the fiscal disequilibrium, craft a comprehensive debt clearance plan and restructure moribund state enterprises as part of a broader strategy to address current economic problems. The fiscal deficit is inflationary and is crowding out the private sector.
Considering the sluggish pace at which the government machinery seems to be moving, there is really no sense of urgency in addressing the economic malaise afflicting the country.
Even without money, a lot can be achieved on the reform agenda. This government does not need billions of dollars to fight corruption, institute reforms and privatise parastatals, cut down on wasteful expenditure, respect the rule of law, property rights, uphold human rights and align laws with the constitution.
What is needed is vision, good leadership, workable policies and iron-clad political will to succeed. Money is the last thing needed.