MDC-T says Mangudya should resign over Zimbabwe’s the cash crisis


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mangudya-john

The Movement for Democratic Change-Tsvangirai says the governor of the Reserve Bank of Zimbabwe John Mangudya is worsening the cash crisis in the country through his ill-conceived ideas and has asked him to resign immediately to preserve the little dignity, if any, he is left with.

“Only a wholesale and complete change of government will be able to extricate Zimbabwe from the prevailing financial and socio-economic mayhem,” Zimbabwe’s main opposition party said.

The MDC-T said the desperate move by Mangudya to try to arrest the prevailing debilitating financial crisis had instead exacerbated the situation.

“From the beginning, Mangudya’s mooted idea to introduce the bond notes a couple of weeks ago, has resulted in massive capital flight as this has increased uncertainty in business. As if he hasn’t learnt anything from the 2008 crisis, Mangudya is foolishly and arrogantly following the same destructive route followed by his predecessor Gideon Gono,” the party said.

Gono was Central Bank governor for 10 years from 2003 to 2013 and saw the country going through its worst crisis in 2007-2008 when it recorded the second highest inflation in the world in history.

He went on a money-printing spree which culminated in the country introducing a $100 trillion note which was rendered useless within days of its release.

Mangudya announced last month that Zimbabwe would be introducing bond notes in October to ease the current cash crisis which he blames of illicit flows out of the country.

He said the country lost $50 million every month last year but this was reduced to $17 million a month this year.

The move was greeted with a lot of skepticism with most people viewing it as the return of the Zimbabwe dollar. President Robert Mugabe, however, said there was no going back on the introduction of bond notes,

“It is disturbing that Mangudya is failing to realise that his ill – conceived idea has not only caused panic in business but has also forced importers and remittance-senders to the black market. It is abundantly clear that the black market will worsen upon the introduction of the bond notes,” the MDC-T said.

“Mangudya and his handlers in the corrupt ZANU-PF regime conveniently appear to be oblivious of the fact that the current low business and consumer confidence coupled with massive cash flight from the banks, is a result of lack of trust of the corrupt ZANU-PF regime by the general public and business alike.

“The world over, common economic logic dictates that, any financial service system only functions on the basis of trust and if that trust is broken, such manifestation as are happening in our banking and business sector would ensue. It is disturbing that Mangudya would suddenly think that business and the general public would miraculously begin to trust the central bank given their experiences during the quasi – fiscal escapades of Gono in 2008.”

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Charles Rukuni
The Insider is a political and business bulletin about Zimbabwe, edited by Charles Rukuni. Founded in 1990, it was a printed 12-page subscription only newsletter until 2003 when Zimbabwe's hyper-inflation made it impossible to continue printing.

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