Two months of Mnangagwa and still no sign of economic turnaround in Zimbabwe

Last week a shortage of bread‚ a basic commodity‚ was announced by the Grain Millers Association of Zimbabwe. The situation has changed for the worse‚ as the association announced on Monday that biscuits and other confectionery products will not be getting an allocation of bread and self-raising flour for at least two weeks.

“Flour supplies remain critically low and it is therefore prudent that the available wheat stocks be maximised towards food security in respect of improving bread flour supplies and self-raising flour for home baking nationwide‚” an association statement read.

The cash crisis‚ on the other hand‚ has presented an advantage for Zambians‚ Malawians and Congolese who have easy access to the US dollar that has been pushed out of the market by bond notes. This because government insists that the bond notes are of the same value as the American dollar. When on the ground‚ the American dollar is worth more than 130 percent of the bond notes. As such‚ Zambians and Malawians in border towns now shop in Zimbabwe.

“They change hard currency into bond notes on the black market and that gives them more than a hundred percent more buying power. It becomes cheaper for them to buy in Zimbabwe than in Zambia‚” said a shop owner.

The biggest winners are truck drivers that move from South Africa right up to the Democratic Republic of Congo. They now buy fuel in Zimbabwe using bond notes instead of hard currencies.

“It works out cheaper. Diesel is selling for $1.34 and if I take that $1.34 and buy bond notes‚ instead of a litre of diesel‚ I get 2 litres‚” said a truck driver with Real Logistics.

On Monday‚ presenting his fiscal policy‚ Reserve Bank governor John Mangudya said that‚ with immediate effect‚ truckers should buy fuel with hard currency and shoppers – whom he referred to as cross-border traders – should also stop “rent-seeking behaviour”.

But for truckers‚ it’s a laughable demand.

“If a trucker buys in forex and the fuel attendant replaces the forex with bond notes‚ how will the governor know? It’s not like diesel speaks that it has been sold to a foreigner‚” said a trucker.

Zimbabweans with access to US dollars‚ mostly mineworkers‚ tobacco farmers and dealers‚ have found ways of keeping their money in stock.

“I am buying cars and parking them. When the situation normalises I will sell them at a reasonable going rate. It’s better than spending the money on consumables. When the crisis started I used to buy bricks up to a point when brick makers failed to meet demand‚” said Wayne Ngorima‚ an illegal forex trader.

The fiscal policy announced on Monday failed to get a buy-in from the worried public.- Times Live.

Ed: Although Mnangagwa was announced winner of the presidential election on 3 August, he only assumed office on 26 August after opposition leader Nelson Chamisa challenged the election result in court but lost the case.

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