Categories: Zim Latest

Stick to economics basics, threats scare investors, ED Govt told

…as Zim’s economic self-dollarisation rages

ZwNews Chief Correspondent

The Zimbabwean government is fighting against the economy’s self-dollarisation tooth and nail, in favour of the surrogate currency, the bond, threatening companies along the way.

When Delta Beverages recently disclosed, the intention to peg prices of its products in foreign currency, the government was shaken summoning the company’s executives to an urgent meeting, that ended in the reversal of the intention by the company.

The government celebrated the outcome thinking the war has been won, but that was not to be.

An agreement was reached, with the leading beverage company reversing its proposal based on the fact that the government would supply the needed foreign currency.

However, the government came under fire for prioritising the issue, at the time the country’s health system is in the intensive care unity, with doctors on strike, while teachers are also threatening to join the industrial action.

Some mocked the country’s leadership alleging that they cannot govern sober citizens, hence the need to keep beer affordable. “Our government wants its citizens to be always drunk, so that they would not interrogate the way they are being governed,” they mocked.

However, the coup leaders’ sympathisers are hitting back, saying it is not that the government value beer more than human lives, but it acted to avert a dollarisation precedence.

However, despite the leading beverages manufacturer have agreed not to price its products in foreign currency, it is being alleged they have hiked prices, so as to cope with the prevailing economic environment.

A clear sign that the war is far from being over.

As if to confirm the brewing war, Industry and Commerce minister Mangaliso Ndlovu has threatened to revoke licences of all companies adjusting prices in an attempt to cope with the prevailing economic challenges.

Ndlovu criticised the companies saying they are trying to hijack the monetary policy from the constitutional authority, which is the Reserve Bank of Zimbabwe, vowing he won’t let that happen.

“We do not want to be stretched to the extent of having to revoke licences. But it would get that far,” he threatened.

Meanwhile, analysts have warned the government against threatening business, as that would contradict the ‘Zimbabwe is open for business mantra’s and could undermine foreign and local investor confidence.

Renowned political scientist Elder Mabhunu has no kind words for the minister, labels him a novice, someone who was promoted to the post not on merit. “I am not sure if he understands the simplest economics. You can not commandeer an economic situation, junta tactics do not work in economics,” he lambasts.

Another analyst weighed in;

“Threats and intimidation against business not solution to Zimbabwe’s economic problems.

“Forcing business to apply illogical economics will lead to empty shelves,”said a renowned Zimbabwean journalist.

zwnews

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