Gloomy independence for Zim…as hyperinflation returns

ZwNews.com

“Zimbabwe @ 39 as we count down to the final hours of Zimbabwe attaining 39 years of Independence we continue to salute all those who contributed to this freedom and also remember that we are now responsible for protecting the gains of this Independence,” those were the words from the Ministry of Information, Publicity & Broadcasting yesterday.

The ministry said final touches were being made, at the National Sports Stadium ahead of the main national celebrations to happen today, and called for Zimbabweans from all walks of life to come and celebrate.

However, as the country gears for the celebrations this is being dampened by the now visible hyperinflation, whose existence President Emmerson Mnangagwa’s regime had been refuting and continues to do so.

According to the ZimBollar Index the country’s March 2019 Year on Year Inflation rate measured at 66.80%, up from 59.39% in February 2019. The Month on Month figure also increased from 1.67% in February to 4.38% in March 2019.

This is also in line with what renowned US economist Professor Steve Hanke had previously predicted. Hanke had been saying the country’s inflation rate was always higher than the official figures being given by the state, and warns that the country should eat a humble pie, admit and plan an honest way out.

 “Zimbabwe, the price of bread has nearly doubled, costing “3.50 RTGS dollars a loaf, up from 1.80 on Monday.” By my measure, Zimbabwe’s annual inflation rate is 205%, more than 3 times the official rate. Zimbabwe needs to install a currency board or fully dollarize,” writes Hanke on a microblog.

But the government is adamant, it is in denial mode and accusing of being economic sabotoures.

Apparently, Dr Pedzisai Ruhanya says it is worrying that Zimbabwe turns 39 under a predatory, corrupt, parasitic, authoritarian, and militarised elite that has privatised the struggle for personal greed.

“As Zimbabwe turns 39 years on 18 April; we value and celebrate the sacrifices of our gallant fighters mostly those who did not see independence in 1980.

“But we remind them, their spirits, that what they fought for has been captured, and corrupted and the people are impoverished,” he writes.

Following the bread price hike, the ministry accused business of profiteering saying business was consulted prior to the crafting of the Monetary Policy and as such government expects business not to hike prices unnecessarily.

In the same light, various economic analysts had been crying their lungs out that for as long as the economic fundamentals were not addressed, such scenarios (hyperinflationary tendencies) were bound to happen, but the government labelled them enemies.

Political scientist Alex Magaisa says the prices are reflecting a reality that had long been buried under a facade; the fraud that the bond note/RTGS was 1:1 with the USD. When that fraud fell, prices were bound to reflect the weakness of the pseudo-currency, adds that government should not blame business.

“It’s foolhardy for the regime to blame business for ‘raising’ prices. The irony is that the government itself ‘raised’ fuel prices, an admission that the 1:1 was a fraud. That ‘price rise’ was the trigger to violent protests last January,” he says.

He says the state should have learned from the past that economic challenges will not be solved by simply panel-beating a currency, as what happened back in the 2000s when the then Reserve Bank of Zimbabwe governor Gedion Gono resorted to slashing of zeroes, from bearer’s cheques, but the zeroes reappeared instantly.

Magaisa maintains that Zimbabwe’s economic challenges are inextricably married to its political challenges, and that to separate the two and imagine that the economics will easily be resolved was an exercise in futility.

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