STAFF WRITER 24 December 2018
HARARE – Before and after the announcement of Mthuli Ncube as Finance and
Economic Development minister the public was bombarded with a series of
articles in the media lauding his educational qualifications and that he
was the best man for the job.
A video of him talking about good and bad money and that he would remove
bond notes by December 2018 also went viral on social media.
Fast forward to today, the nation is confused – not so sure if Ncube is
the right person for the job.
The economy is in bad shape with no glimmer of light at the end of the
Ncube’s ill-timed, reckless utterances and fiscal measures announced in
October triggered a run on foreign exchange as everyone wanted to offload
the bond notes and electronic balances.
This resulted in parallel market premiums shooting up, translating into
higher prices and inflation.
Unfortunately, the Finance minister is not taking responsibility for his
actions but goes on to expect the general populace to share the pain for
problems they did not create.
Ncube, along with other political leaders continue to live in prosperity
yet they are the architects of the current problems.
They are the policymakers, whose policies and actions led to the huge
budget deficit, which was being financed through Treasury Bills (TBs) and
creation of money through electronic balances.
Part of the debt, which was being paid through TBs is debt for tractors
and farming equipment, which the same politicians refused to pay for and
voted in Parliament for the debt to be assumed by government.
The list of beneficiaries remains a secret notwithstanding that
beneficiaries of equipment are undertaking productive activities with the
equipment as well as generating revenue through hiring it out.
It is the poor who are paying for the equipment of the rich and, through
Command Agriculture, buy them inputs and at the end of the day a higher
producer price is paid for with money that government does not have thus
increasing money supply growth and contributing to macroeconomic
instability, whose adverse effects are higher on the poor.
Ncube’s two percent tax is also wreaking havoc on the poor. Why do we put
so much money in agriculture and get so little revenue?
Why do commercial farmers not pay tax like any other business entities?
This is a challenge for Ncube to tax A2 commercial farmers, some of whom
also owe power utility Zesa Holdings and the Zimbabwe National Water
Authority for electricity and water consumed. Ncube should also engage
other stakeholders more than he is doing at the moment.