Is Zimbabwe on the brink of a state of emergency?

Source: Is Zimbabwe on the brink of a state of emergency? – NewsDay Zimbabwe June 21, 2016

WITH Zimbabwe rapidly descending into chaos, in a field of food and income insecurity hotly spiced by cash shortages and increasing threats to peace, the world may forgive the President of Zimbabwe if Robert Mugabe he declares a two-year State of Emergency to allow his Presidency time to resuscitate the economy with the help of key development partners, so goes a school of thought gaining currency with time. Another moralistic one says he should call for general elections as his 2013 manifesto, and thus his mandate, has all but gone up in smoke with the passing of time.

Tapiwa Nyandoro

The reckless talk attributed to the Zimbabwe National Liberation War Veterans’ Association leadership threatening bloodshed if their will is not imposed on the President’s party and the people, and his and one of his Vice-President’s stern rebuke, all in a very inflammable environment, suggests that peace may be under threat.
The chaos at Treasury, most ministries, the financial sector and at the Central Bank is a mark of deep fiscal and monetary problems.

Add to this cocktail of misfortunes — a shrinking economy, massive unemployment and job losses, debilitating national, local government, parastatal and household debt burdens — a declaration of a State of Emergency, or a request for fresh mandate, is justified. It can not be business as usual. A call to the world for assistance, on time, is in order.

The drastic steps would allow the President or his successor to do any, some or all of the following things:

 Put the Reserve Bank of Zimbabwe (RBZ) under curatorship. Preferably the curator of choice would be the World Bank (WB). Alternatives would be the South Africa Reserve Bank, the Federal Reserve Bank of the United States or The People’s Bank of China should they so agree. The curator should lead efforts to do the following:

 Adequately recapitalise the RBZ bringing in new shareholders

 Review and correct its structures and the laws governing it and its relationship with Treasury, including its independence and

 Identify and groom local talent from within and without the bank, to manage the bank, after the curatorship period

 Clean up and rationalise the banking sector.

 Put Treasury, the Ministry of Justice, the State Procurement Board, Zimra, Harare City Council and the Ministry of Local Government under some form of judicial management led by the International Monetary Fund (IMF). The mandate of the manager may include, but should not necessarily be limited to, the following programmes:

 Stamp out corruption and develop structures to resist it

 Increasing voice and accountability

 Improving government effectiveness

 Revamp the regulatory framework

 Review all revenue collection and procurement procedures and laws; Map out spending priorities of the State, budgeting methodologies and

 Ascertain the financial positions of local authorities and how they can be improved

 Seek debt relief for central and local government

 Review Zimbabwe’s capital account liberalisation and introduce a local currency

 Set up a States Assets Administration and Supervision Commission, an umbrella body under which most, if not all, State-owned enterprises (SOEs) and trading accounts will be managed. The commission should:

 Dissolve all current boards of directors in SOEs replacing them with general managers in the short term;

 Review all legislation governing SOEs to reduce ministerial interference;

 Bring the audits of financial statements up to date;

 Sell off potions of non-core SOEs in a judicious manner

 Lead the recapitalisation of key SOEs within partnership frameworks with the local and foreign private, quasi private and public capital. Regional SOEs such as Transnet and Eskom should especially be courted.

 Strengthen management of SOEs by appointing reputable advisors with impeccable credentials and appointing auditors with international reputations. This will add in fundraising as TRUST (own emphasis) is a key to such activities. The likes of Britain’s National Grid could assist Zesa Holdings; GE of the US and Deutsche Rail could help revamp the National Railways of Zimbabwe. While Ethiopian or Virgin Air could assist Air Zimbabwe.

 Concurrently the Presidency, with the help of Parliament, should review the Constitution with the objectives of:

 Reducing and putting a constitutional cap on the number of ministries, ministers, deputy ministers and ministers of State,

 Reducing Presidential terms to one seven-and-half-year or 10-year one, with one Vice-President who will automatically take over if the President is incapacitated.

 Reducing and capping the number of statutory bodies

 Reducing the combined establishment of the security cluster (police, intelligence, army and air force) to a manageable and affordable 39 000 others. That is three per every 1 000 citizens. An element of multi-skilling or dual roles would be a major option as should be conscription of males before tertiary education.

 Reduce and cap the civil service to around 260 000 or one civil servant for every 50 citizens, most of whom must be teachers and nurses.

 Adopt modern job grading and reward management systems across all publicly funded establishments. That should see some lustre regained by the teaching, nursing and other professions outside the profession of arms.

 Solicit, with the help of the IMF and the WB, for a $15 billion bail out grant for reconstruction, development and concluding the land reform programme.

Prospectively to exercising above optional agendas, a consensus with the loyal opposition would ease the way and seal out political opportunists.

It may also be necessary before roping in the IMF and WB, a process that might take time, to make the bond coin and note Zimbabwe’s official currency, as an interim measure, and to ban the importation of all pre-owned vehicles and clothes for nine months.