Economic pundits turn to the Bible as economy falters

via Economic pundits turn to the Bible as economy falters – The Zimbabwean. 8 October 2015

With Zimbabwe’s economic challenges mounting by day, characterised by over 80 percent unemployment, massive retrenchments, company closures and deflation, economic experts are trading economic text books for the Bible in search of answers.

Speaking at a recent breakfast meeting hosted by the International Monetary Fund (IMF) and the Ministry of Finance, economic experts took turns to quote the Bible while proffering solutions to the country’s problems.

Reserve Bank of Zimbabwe governor John Mangudya said the country was in a delicate position hence the need to ensure that “whatever we do, we do it with care and love.”

Persistent drought
“When I was checking the Bible in 1st Corinthians 9 verses 20 to 23, when Paul was visiting the Church in Corinth, where things were so difficult like in Zimbabwe, he said, ‘whenever you are moving, you also behave like those people to move forward.’ Where we are right now is a delicate position and requires all our wits to go forward,” he said, adding that there was need to also revamp the agriculture sector.

The country has been hit by a drought with the World Food Programme estimating that 1,5 million people  will require food aid this year while the drought is expected to persist next year.
Another participant, identified as Dr Sibanda, quoted Psalms 124 saying that “unless the Lord builds a house, it will be built in vain.”

Director of the Labour and Economic Development Research Institute of Zimbabwe, Godfrey Kanyenze, referred to as ‘reverend’ called on Zimbabweans to unite before quoting  Genesis 11 when mankind started building a tower of Babel which made God worried and confused their language.

“These guys were so united and nothing could stop them,” he said. Kanyenze said there was need to spend more time in “finding each other and understanding the challenges we are facing and harness the collective wisdom and responses embodied in our diversity.”

Pro-poor growth
“We need pro-poor growth, we need growth that is job rich that raises people at the lowest levels. We need to transform the economy from the informal to a formal economy,” he said.

Foreign affairs minister, Simbarashe Mumbengegwi, blamed the economic woes facing the country on sanctions. “Zimbabwe is one of those countries that have been under sanctions for over a decade and it is a bit odd that a roundtable to discuss the economic prospects of a country under sanctions, no one wants to mention sanctions. So I decided to be the odd person to raise the issue,” he said.

In response Kanyenze said there was need to stop the blame game. “When I was younger, my past time was on bashing the IMF, World Bank and everyone else. As I grew older, I realized that my life was my responsibility, no one owes me a living,” he said.

He said the IMF would not understand the problems in Zimbabwe better than its people. “There is no way they can come up with prescriptions that are better than what we can prescribe as a collective here in Zimbabwe.  I get worried when we outsource our development. It demobilizes us focusing on the sanctions mantra. It makes us useless, we are waiting for someone else to take action on us,” he said.

A dreamer
Finance minister, Patrick Chinamasa weighed in saying that there was need for leaders to define the reality the country is facing. “This is what I did when I moved to treasury in September last year, in terms of where Zimbabwe sits globally and also the reality internally otherwise I will risk being a dreamer. You become a poet and live in a world of your own,” he said, in a thinly veiled attack on his colleagues Mumbengegwi and Christopher Mutsvangwa (war veterans’ minister) who blamed the country’s problems on sanctions.

“Where we stand, yes the country is under sanctions and the country has a debt overhang,” he said, but called on leaders in government and the private sector to craft strategies to circumvent the obstacles.

Chinamasa said the in the last 20 years Zimbabwe has not been fully integrated into the global economy due to the debt overhang with the country owing multilateral institutions $9,9 billion.

“I don’t want to pretend that reality is not there. The reality we have is that we are indebted to almost everybody who has done business with us. If we ignore that reality we will not go anywhere, we will just go in a vicious circle,” he said.

Frank discussions
Chinamasa said he accepted  criticism on policy issues. “Don’t bring in IMF, don’t politicize the discussion. Please let’s handle the merits of a policy and agree whether I am wrong or you are right,” he said. Responding to a comment on IMF traumatizing people it deals with, Chinamasa said they have had “frank” discussions with the fund.

“Whether in future I get traumatized, let’s wait but for now you don’t need IMF to tell you that if your revenue is $100 and you spend $85 paying workers it’s sustainable. You don’t need IMF to tell you that if your banks are running non-performing loans the sector can collapse. That is the stage where we are with our relationship with the IMF,” he said.

IMF representative Domenico Fanizza said the general environment in the country  did not favour economic activity hence the need to restore confidence following the hyperinflation of 2008 which saw inflation ballooning to 500 billion percent.

No quick fix
He said reforms are also needed adding that there is no “quick fix” and that ad hoc approaches will not work. “What you need is a comprehensive and medium-term solution. The reforms that are needed are costly and will take long time to be felt and to produce the kind of resources needed,” he said.
He said the country’s failure to service its arrears is a challenge. “The country is deeply in trouble and so it is impossible for it to borrow,” he said.

Fanizza said the Staff Monitored Programme – an informal agreement between a government and IMF staff to monitor the implementation of its economic programme – which started last October, will help to build a track record for Zimbabwe, improve capacity to repay and service its debts.

Zimbabwe today (October 8) participates in a meeting in Lima, Peru where the international financial institutions are expected to agree on a plan to clear its debts.