The adopted mantra of the new Government was ‘we are open for business’ but this false store front hid a far wider agenda of reform and change. In days after the November 2017 transition the new President had instituted far reaching reforms to the very institutions that had carried him into power. The leadership of the security services and the armed forces were changed, in succeeding months the military Junta which had kept Mugabe in power since Independence and which had increasingly subverted constitutional and civilian government was dissolved. The reform of the security forces is continuing and has a long way to go but a great deal has been achieved in the past 15 months.
In August 2018 he appointed a new team at the Ministry of Finance – not just Mthuli Ncube but a whole raft of changes at a senior level. The new team lost no time – a ‘Transitional Stabilisation Plan’ was crafted and a program of reform to fiscal and monetary policy agreed and rolled out. The changes have been dramatic – in weeks the fiscal deficit was eliminated, then foreign exchange balances in the Banks ring fenced and protected. Then monetary reform and right now we are in the process of gradually allowing exchange rates to find a rate at which supply and demand are in equilibrium.
Soon a new currency will follow and normal conditions of trade within a stable money market restored after three decades of chaos. The new Minister was clear – this would be a time of austerity while we found our feet in a new dispensation of fiscal and monetary discipline. He was not exaggerating in any way – our living standards have plummeted and the real value of our local currency devalued to 25 per cent of what it was two years ago.
But it was necessary and all Zimbabweans should understand this and I call it the struggle for realignment to the new realities of our situation after decades of economic delinquency. The impact of these changes has been dramatic and the process will continue for much longer. But we are establishing a market driven economy and the process of what we call ‘price discovery’ is well underway – this refers to the way the markets establish equilibrium and balance when they are allowed to do so. The State can only guide and stabilise this process, they cannot stop it and any attempt to do so will end in failure.
The new dispensation is going to strengthen the productive elements in our society – those who actually produce value are going to prosper and in the process this will eventually make Zimbabwe one of the fastest growing economies in the world – one of the new African Lions of Growth. The consumptive elements – including the corrupt and those who have been feeding at the trough of patronage and privilege are going to find themselves being forced to work and use their ill-gotten gains to actually make a living for once.
But for the ordinary person living on a fixed salary or trying to make a living on the margins of society and in the massive informal sector we have, this is a time of painful sacrifice and I am just amazed at how patient they have been. The floating of the currency from 1:1 with the US Dollar to the levels prevailing today of 3,1:1 on the official interbank market and 4,5:1 on the open market means that prices have had to rise 3 to 4 times. Many firms have increased salaries but the changes have been marginal. Fuel prices were first, maize meal and bread will follow along with vegetable oils.
Major adjustments are now needed to salaries and disposable incomes and this MUST be the next area to receive attention and Mr. President, please explain what you are doing when you have to do whatever is necessary – not like the fuel price adjustment. If we know what you are doing and why and the reasons are reasonable we will take the pain but we need to know that they are taking us towards the new beginnings that were promised when we said yes to the removal of Mugabe.
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