Source: Chinamasa,Kombo Moyana clash over bond notes – NewsDay Zimbabwe May 14, 2016
FINANCE minister Patrick Chinamasa continues to take brick-bats from Zimbabweans across the political divide with respected former Reserve Bank of Zimbabwe governor Kombo Moyana the latest high-profile person to tell the government it is lost.
BY RICHARD CHIDZA
Chinamasa almost blew his top during a heated public discussion organised by the Southern African Political and Economic Series (Sapes) Trust on Thursday, where economists argued against the re-introduction of the country’s comatose currency.
Moyana, Zimbabwe’s first black head of the apex bank, told the discussion that while he was in agreement with authorities regarding plugging of cash leakages, the bond notes would be no solution.
“I do not know if we are heading in the right direction by introducing the bond notes. Our salvation is in think-tanking, Zimbabweans are respected globally and I do not see why we cannot tap into that to spur exports. That should be the way out, exports and more exports and not bond notes,” Moyana said.
He was supported by Bank of Zambia ex-governor Caleb Fundanga.
“Confidence in the Reserve Bank is important because people have to believe whatever pronouncement is made will be sincere. I do not know if it is the right time to introduce the local currency or bond papers,” Fundanga said.
Chinamasa did not take lightly to it and accused his audience of coming to the meeting with “closed minds”.
“I want to make it very clear: We are not introducing the national currency. Our people do not want to hear it. But we should not be prisoners of the past. Some of you are not open to discussion. Bond notes are the elder brother to bond coins. They are here to stay and will be around until we re-introduce the Zimbabwe dollar at the appropriate time and when the fundamentals are in place,” Chinamasa retorted.
Moyana said he was perplexed to see government taking a leisurely approach to the country’s crisis.
“In my time working with Bernard Chidzero (former Finance minister), we made sure our wage bill was maintained at 20% of government income. We would shiver if it approached 25%, but now people go to sleep when it is at 83%. No country or institution can survive when it is using 83% of its income to pay wages,” he said.
Economist Ashok Shakravarti told Chinamasa: “The market views the bond notes as a re-introduction of the Zimdollar.
Even industry and commerce would rather have a 3% tax on imports than these proposed bond notes. The issue is about creating confidence in the market and that cannot be achieved by introducing the Zimdollar.”
And another speaker, Caleb Dengu, painted an even scarier picture describing the move to introduce the local currency as a threat to national security.
“People have been mugged by this economy before and cannot risk walking that route again. Zimbabwe has a country risk, but until the announcement that government would be introducing bond notes, we did not have a currency risk,” Dengu said.
But Chinamasa accused Dengu of blowing things out of proportion and seeking to cause anarchy.
Chinamasa argued “the market will be the final arbiter”.
“We are doing this in good faith and will keep our options open. Nothing is cast in stone regarding the policy pronouncements we have made, but we must make sure whatever we say, we are aware of our unique situation as a country,” the Finance minister said to murmurs of disapproval.
COMMENTS
sounds like chinamasa was the one with the closed mind.
as chinamasa said – the market is the final arbiter and already us$ have disappeared from atm
The Minister should have told his audience where on earth they got money to pay Civil Servants salaries. Now everyone knows that they are trying to plug the whole they have created by printing bond paper!
I have heard news that the government was printing notes and I thought it was a joke and I am sure they denied it. I am convinced the reason why Chinamasa was in his own corner and everyone else in the other corner is because he is worried about what he will do with the stash of bond notes he has printed if the plan fails.
To the finance minister: Surely everybody cannot be wrong and you are the only one who is right! Lets be real and stop dreaming. The economy is on its knees, if its goes beyond that it will be underground.
Just who did the government consult if everyone is against the idea? And why does a lawyer think he understands this issue more than economists? It seems the politicians are too used to pontificating at rallies that their minds have regressed to the same level as those who ululate when the politicians spew rubbish. A lesson for those to come is “always interact with those with superior intellect and skill than yourself”.
We of Asia say “a good leader leads from behind” his people, always seeking their expertise, he cannot be in front as an I know it all, he is not an expert himself at least not in everything. With this principle of taoism, “following from behind” the leader gets everything done with the people feeling that we have done it together. In front the leader will always fall like a soldier in the battlefront because he stands exposed against the people he leads. Zimbabwe fails to learn from its past, your dollar once collapsed and it became a shame of the whole market world, nobody in business wants to hear about it let alone Zimbabwe business people. Introduce it then against your own people and you are bound to lose foreign direct investment, even the Eastern confidence you claim to have in business unless your friends decide to fool you around. If these politicians are adamant the President Mr Mugabe must stand up and exhort them to the mark and tell them in the face you are about to shoot my government in the feet. Zimbabwe will soon become a laughing stalk of the world economy again. Well the opposition parties must stop looking at it happening without using it for a better mileage to their side. You will remember the wisdom of your economists when it is too late, how can anyone in good faith fail to hear Kombo Moyana who is wisely advising to take him for a fool. He is saying he does not know whether it is the right thing to do, he knows well only that he is a respectful man who feels ashamed to tell you the truth you have it wrong here, addressing symptoms for a bigger crisis underneath.
We of Asia say “a good leader leads from behind” his people, always seeking their expertise, he cannot be in front as an I know it all, he is not an expert himself at least not in everything. With this principle of taoism, “following from behind” the leader gets everything done with the people feeling that we have done it together. In front the leader will always fall like a soldier in the battlefront because he stands exposed against the people he leads. Zimbabwe fails to learn from its past, your dollar once collapsed and it became a shame of the whole market world, nobody in business wants to hear about it let alone Zimbabwe business people. Introduce it then against your own people and you are bound to lose foreign direct investment, even the Eastern confidence you claim to have in business unless your friends decide to fool you around. If these politicians are adamant the President Mr Mugabe must stand up and exhort them to the mark and tell them in the face you are about to shoot my government in the feet. Zimbabwe will soon become a laughing stalk of the world economy again. Well the opposition parties must stop looking at it happening without using it for a better mileage to their side. You will remember the wisdom of your economists when it is too late, how can anyone in good faith fail to hear Kombo Moyana who is wisely advising to take him for a fool. He is saying he does not know whether it is the right thing to do, he knows well only that he is a respectful man who feels ashamed to tell you the truth you have it wrong here, addressing symptoms for a bigger crisis underneath.
It then means that we have never been together with our gvt in shaping or reshaping our economy, hw can someone do a proper research and implement the opposite. It therefore sums up to a hidden mission. People are desperate and eager to turn around the economy for the good of every citizen but nw there is use of force for people to accept the imposed bond note, where are we going. Have mercy on your fellow Zimbos, cast away this spirit of stiffness. Lets build our country in harmony, its our country not your country.