On Wednesday morning, I walked into a supermarket in Harare and came across a factory worker gazing blankly at the front pages of local newspapers.
I moved closer to the newsstand, swiftly scanned the front pages and asked him what the big story of the day was. He was somewhat hesitant, almost non-committal, perhaps because he viewed my question as an unwelcome intrusion by a stranger. I then pointed at one newspaper headlined “Currency stability to spur growth” and asked him what he made of that particular story.
Immediately—as if on cue—the man tossed his head backwards, clicked his tongue dismissively and roared into laughter. “He’s not serious!” said the man, pointing at the paper. The person he accused of lacking seriousness is none other than Finance minister Mthuli Ncube, who was quoted extensively in the news article hyping up Zimbabwe’s economic prospects for 2020.
Professor Ncube reiterated his 3% GDP growth projection—an astonishing stance in the face of all the self-evident indicators on the ground. To his credit, the Finance minister cannot be accused of lacking enthusiasm for the tough job of patching up a tattered economy. But the public has often criticised him for blurring the lines between reality and fantasy, especially when it comes to economic projections. Last year, some folks gasped in disbelief when it was revealed that perhaps the good professor may not quite know the exact price of bread in Mbare.
How in the world can Zimbabwe achieve 3% growth this year?In the 2020 National Budget presented last year, the Treasury chief said economic growth would be led by recovery in agriculture. That expectation seems unrealistic now, in view of erratic rainfall which has made it difficult to practise viable farming.
Food imports are inevitable. Already, the staple maize-meal is only readily found on the parallel market.
On the energy front, the minister is hoping to ramp up economic production on the back of imported electricity. It sounds like a threadbare plan, not least because Zimbabwe is still grappling with a foreign currency crisis that stubbornly refuses to go away.
We should also remember that global growth prospects this year are expected to veer towards a modest rebound—but outlook is decidedly fragile. And in our region of the world—sub-Saharan Africa—where 56% of the planet’s poor people live, poverty eradication is likely to remain a pipedream this year.
Recently, the IMF approved a US$3 billion economic rescue package for Ethiopia. Meant to lay the foundation for sustainable and inclusive growth, the reform programme involves shoring up the macro-economic fundamentals of that country by curbing on excessive expenditure, reforming the state-owned enterprises, taming inflation, ushering in exchange rate stability, improving the investment climate, and boosting export competitiveness.
In other words, Ethiopia’s reform agenda sounds exactly like Zimbabwe’s IMF Staff-Monitored Programme. But that is as afar as the similarities go. On paper, the objectives of the two countries dovetail. In reality, however, the stark differences are like night and day. While Ethiopia has embraced far-reaching reforms, Zimbabwe is stuck in the destructive ways of old.