MDC solution to Zimbabwe crisis appears to be veiled call for GNU

With the above characterizing economic activity in Zimbabwe, the underlying assumptions for recovery are therefore non-existent. In this kind of situation a government which regulates consumer spending and control prices is a wrong government. It is a government which only worsens the situation.

It creates shortages, encourages the alternative market and subsequently exacerbates prices they are trying to control. The government must attend to its expenditure irregularities and provide supply side solutions.

We have also argued that the centre piece of any government policy must be restoration of production. Zanu PF’s failure to create conditions in respect of which the economy is grown and jobs are created will always harm this economy.

We further made the point consistently that the cash crisis, multiple exchange rates and the bullish trend in respect of the prices of the US dollar is a direct result of fiscal mismanagement.

The cost of the dollar is therefore the major driver of inflation. This cannot be corrected through institution of barbaric price controls and threats of revoking retail licenses.

We therefore propose the following solutions.

1. The government must design an Emergency Recovery Economic Plan supported by an Emergency Recovery Fund.(Creating such a fund will not be possible under a Zanu PF government)
2. Inject funds into traditional funds like DIMAF and ZETREF to revive distressed companies as part of supply side solutions.
3. The government must leave within its means, maintaining a primary balance is a hallmark of successful fiscal cycles.
4. Deal with the liquidity crisis including paying back the money stolen by the government at the RBZ which was kept in RTGS balances.
5. The government must construct itself out of the current crisis, by dealing with the infrastructure gap employment will be created and aggregate demand will also increase.
6. Initiate a sustainable debt clearance strategy and end isolation of the country by sincere re-engagement of the international community.
7. Combat corruption which has put a huge premium on the economy, the strategy must include regular life style audits for all top public officials.
8. Scrap the bond note, attend to fiscal hygiene and join the rand monetary union.

MDC: Change That Delivers
Jacob Mafume
MDC National Spokesperson

(679 VIEWS)