Govt mismanagement, profiteering elites destroyed Zim: Moss 

GOVERNMENT mismanagement and profiteering elites have destroyed Zimbabwe’s markets for food and fuel while lying to the public about actual foreign currency on hand, a former United States government official has said.

Source: Govt mismanagement, profiteering elites destroyed Zim: Moss – NewsDay Zimbabwe December 11, 2018

BY TATIRA ZWINOIRA

Former Deputy Assistant Secretary of State for Africa relations, Todd Moss, who served in the George W Bush administration, was testifying before the United States Senate Foreign Relations Subcommittee on Africa and Global Health Policy, a hearing which focused on Zimbabwe.

The US has maintained sanctions on the southern African nation since 2001 through its Zimbabwe Democracy and Economic Recovery Act (Zidera).

The Act is seen as impeding the country’s ability to attract meaningful investment and borrowings by penalising businesses with US ties for doing business with Zimbabwe.

Under Zidera, the US sanctioned individuals and dozens of companies associated with the government.

President Emmerson Mnangagwa is among the 141 people and institutions that are still under the US sanctions, which were extended on July 25 this year, days before elections.

Moss told the subcommittee that the current government was in denial over the state of the economy and, as such, any money given to it would be “good money after bad.”

“Absent meaningful reform, any aid to the government from the United States or others is throwing good money after bad. We can see the government’s state of denial in their passive language. The government says people died on August 1. No, civilians were murdered by the military, in plain sight of the world,” Moss said.

Moss is currently a senior fellow at the Center for Global Development, a United States think-tank, and is a non-resident scholar at the Rice University’s Baker Institute in America.

His testimony comes on the backdrop of the President Emmerson Mnangagwa-led administration seeking to reengage the United States and multilateral partners for urgent fresh lines of credit.

The increased efforts stem from United States President Donald Trump signing new amendments to the Zimbabwe Democracy and Economic Recovery Amendment Act of 2018 (S2779) into law, that enacted stricter targeted sanctions.

“Government mismanagement and profiteering elites have destroyed the markets for food and fuel. The government says that hard currency is unavailable. No, the country has no US dollars because they have been lying to the population about what’s really in the bank,” Moss said.

As at the end of September 2018, there was $279,1 million in the nostro balances recorded for that month, according to the central bank’s September 2018 monthly economic report.

But with fuel consuming an average of 50,2% of foreign currency generated every month, that has left very little for other critical forex-dependent areas.

“Food, fuel and even US dollars are all in desperate short supply. The new Finance minister is a respected professor and his new budget has some notable reforms, at least on paper. But none of the structural problems in the economy are being tackled. Zimbabwe’s economy cannot be rescued by tweaking fiscal policy at the margins,” Moss said.

He said fixing Zimbabwe’s economy was not a technical exercise about moving the budget deficit by a percentage point or two or by deploying more accounting gimmicks.

Analysts say an example of the current government’s mismanagement could be seen in the central bank overdraft and Treasury Bills (TBs) issuance that has ballooned the country’s domestic debt.

According to a September 2018 Parliament Budget report, domestic debt is expected to rise by $2,5 billion to $9,5 billion by year end, most of which would be financed through issuance of TBs and the central bank overdraft.

Between January 2017 to August this year, TBs rose by $5,5 billion to $7,6 billion while the government overdraft with the central bank stood at $2,3 billion as at August 2018.

“The roots of the economic crisis are political. The solutions also must start with political reform. For these reasons, the United States should be extremely cautious in its re-engagement with the Government of Zimbabwe,” Moss added.

Moss added that until the government dealt with the dominance of the military in the economy, the ongoing rackets of predatory elites, and the flouting of basic rule of law, “Zimbabwe’s economy could not be fixed”.

COMMENTS

WORDPRESS: 5
  • comment-avatar
    Morty Smith 3 years ago

    Such a shame, it could all have been so different

  • comment-avatar
    mazano rewayi 3 years ago

    Zim just needs an overhaul, a real paradigm shift. Only new people with a new perspective, a new approach to tackling problems and a new narrative for progress will achieve that. The new crop should dialogue with all but shun populism. They must pursue inclusive and transformative economic policies rather than mere investments. Most importantly they need to see the people of Zimbabwe as agents of their own change rather than mere children to be pampered with toys and entertained with lies.

  • comment-avatar
    Tsotsi 3 years ago

    Zimbabwean black people have a fundamental cultural problem: there is not enough emphasis on the concept that anything worth having in life is only acquired by hard work, continuously pursued over a long time, self sacrifice, honesty, integrity and constant attempts to better one’s qualifications, understanding of the world as a whole. Not to take the seemingly easy but dodgy way out, but to apply effort to every task. F is for ‘effort’ in the Zimbabwe alphabet. Or maybe failure in reality? There are no short cuts. Yet Zimbabwean black youth lionize and envy shallow contemporaries who have cheated the system by emigrating, then living off the generous welfare provisions of Western countries, or successfully used dubious, dishonest tactics to cheat those same economies and remit the ill gotten gains back to Zimbabwe, where their value is artificially magnified several times over. This not ‘success’, it’s cheating and everybody knows it. It gives Zimbabwean blacks a bad name overseas. One they so far richly deserve. 

    The black Zimbabwean culture up to now has been to constantly, actively, ingeniously seek the easy effortless way out: use guile, cunning or even tacitly criminal means to get what one wants: to hell with the effect on others. The celebration of the easy way out is what has given Zimbabwe corrupt politicians who have stayed in power so long. The politicians promised black Zimbabweans what they knew, or should know was fundamentally wrong: something for nothing. Demonizing white people and wantonly confiscating their property, companies and efforts worked in the very short term, but as the work ethic, skills and general integrity of whites was lost, Zimbabwe descended into what President Trump so succinctly described as a ‘sh1th0le’. 

    Until the black Zimbabwean culture changes to realize it was a catastrophic mistake to alienate the whites, go back to the principles of hard work, industry, self betterment, humility, honesty and chastisement of anyone in the community who does not live up to these values, Zimbabwe remains doomed. That and the whole scale firing of every admindroid doing a useless job shuffling paper in the impossibly bloated civil service. 

    • comment-avatar
      Doris 3 years ago

      Hear hear!  That’s all that’s needed to be said.

    • comment-avatar
      mazano rewayi 3 years ago

      This is a generational issue. Before independence the same black Zimbos respected the dignity of labour, sustained a war for 16 years with little outside support whilst producing surplus food to export. What you complain about is the attitude that has been built by the government and donors over the last forty years. It is the case for all societies in which people are given free things – that’s why the Socialist experiment failed. That’s why aid does not work. The solution is not to call for a change in culture but to force that change by removing all “free” things. All men are creatures of circumstance – deny a man free food and hunger will make him work (not sing) for his supper. All those silly donors should just leave. With empty coffers and a misfiring economy the govt cannot buy support anymore. With no donors playing Father Christmas for everything from child supplementary feed to adult underwear Zimbos will wake up. It will be tough at first, just like leaving your parents for the first time, but eventually we will all be grateful for it. We need another generation to completely transform ourselves so our thinking and planning should be long term.