How did Mr. Busisa Moyo become president of the Confederation of Zimbabwe Industries when he does not have any common sense?
"There is a possibility that this time lapse can create unintended consequences in the end. There are several likely reactions that could be problematic considering our recent economic history and the general lack of confidence in locally engineered instruments," said Mr Moyo.
He was commenting on the recent announcement by RBZ governor Dr John Mangudya to introduce bond notes in two months-time, set a maximum individuals can withdraw from their accounts and a limit on external payments.
"People will queue daily to utilise the $1 000 maximum withdrawals and not rest until all their US dollar balances are at zero. This again could be a negative consequence which will create further cash shortages," continued Moyo.
Mr Moyo, however, said the reactions were likely to change, with perception easing as with the coins once reassurances from the governor, business community and the Nostro guarantor are made. He said the main challenge was of confidence and trust in local institutions.
To start with the introduction of the bond coins did not have the same effect as the introduction of the bond notes is having because no one expected their bank balances to be converted from US$ to bond coins or did anyone fear that they would be paid in bond coins except for small change. The introduction of the bond notes is changing all that; people will now be paid in bond notes, take it or leave it!
The nation has been spending more on imports than it earned from exports and so has had a net outflow of foreign currency. It was just a matter of time before we started running out of cash.
Bring in rule to make it more difficult to send or take money out of the country will reduce imports and, since we have been importing most of our goods, there will be shortages. We are back to empty shop shelves, fuel shortages, etc. of 2 000 to 2008!
When the country scrap the Z$, removed all the price controls, etc. in 2008 the government should have moved swiftly to restructure the economy and put it on a firm recovery path. These last eight years has been wasted opportunities as Zanu PF and the GNU before it have done nothing get Zimbabwe working again. Zimbabwe has become a nation of consumers and informal traders – 90% of the informal sector are buyers and sellers – and very few producers
The shortage foreign currency, the reintroduction of the Z$ by the bond notes back door, the underlying economic collapse, etc. are the consequential readjustment of the economy to its reality of a consumer nation that has been living beyond its means. Zanu PF has continued to behave as if the skewed high spender economic system by a nation that is producing no wealth was sustainable; now the regime is being forced to accept the reality that the system in NOT sustainable.
Dr John Mangudya’s measures of capping the amount individuals can withdraw, etc. will not stop the economic collapse that is taking place; the measure are as futile at stopping the economic collapse as the proverbial frog’s fart at putting out the forest fire.
The nation had expected someone in the illustrious position of President of the Confederation of Zimbabwe Industries to lead from the front these last eight years warning the regime of the dangers of the forest fire and not waste time wittering of the frog’s fart. Mr. Moyo the RBZ and government itself have failed the nation there is no talk anyone restoring “confidence and trust in (these) local institutions” as they presently constituted.
Zimbabwe economy has been drifting down the flooded Zambezi River for years and the waters have been rough and dangerous, pushing unemployment to the dangerous levels of 90% and forcing millions into abject poverty. The country has now been forced to revert back to using its own currency marking the beginning of even rougher waters and deadly twists and turns.
At the end of the day Zimbabwe will implement the meaningful political reforms necessary for the holding of free. Fair and credible elections; there is no other way out of this mess!