Economic revival eludes govt

via Economic revival eludes govt – The Zimbabwe Independent June 27, 2014 by Taurai Mangudhla

PRESIDENT Robert Mugabe and his Zanu PF government’s commitment towards reviving the economy has been questioned with analysts arguing the ruling party is pre-occupied with factional fights at the expense of tangible reforms to steer the country towards recovery and growth.

After averaging 10% from 2009 to 2012, Zimbabwe’s economic growth fell to an estimated 3,3% in 2013 to end the economic rebound experienced since the end of hyperinflation in 2009, with World Bank projections pointing to a 4,2% growth in 2014 due to stubborn macro-economic challenges yet to be addressed.

After the 2014 Article IV Consultation with Zimbabwe under the Staff Monitored Programme (SMP) which ended on June 18, the IMF executive board reported Zimbabwe’s external position remains precarious with usable international reserves covering less than two weeks of imports.

Financial sector vulnerabilities persist, there is low capitalisation in industry and low liquidity amid political and policy uncertainty factors that have for long been noted as deterrents to investment inflows.

“Zimbabwe faces serious medium-term challenges and achieving sustainable, inclusive growth will require strong macro-economic and financial policies, an enabling business environment and normalised relations with creditors,” said the IMF in a press statement this week.

“Other risks relate to policy inconsistencies that could affect investment and financial sector vulnerabilities such as liquidity shortages and disorderly unwinding of troubled banks,” the IMF added.

Government’s sluggish response to factors affecting the economy which have resulted in successive extensions of the ongoing SMP, Harare-based economist Godfrey Kanyenze said, shows the ruling party is not committed to doing the right thing.

“We are already moving in the wrong direction after indications the government wants the SMP to be extended further beyond June 2014 because we are not doing what is supposed to be done,” said Kanyenze in an interview.

He said government has misguided priorities and is reluctant to deal with endemic corruption and bureaucracy which increase the cost of doing business or implementing real measures to cut the ballooning wage bill. “How can you have money to buy luxury vehicles for officials and not afford clean water?” asked Kanyenze.

The economist said government is focusing on factional fights and not bread and butter issues, adding factional-driven policies and discord among cabinet ministers worsened Zimbabwe’s performance in terms of policy consistency, clarity and coherence.

“There is discord and government is in a quandary because of the way it was constituted to balance factions. This is clearly not working because people are not singing from the same hymn book.”

Independent economist John Robertson said government spoiled its chance to meet the SMP when it granted civil servants a 26% wage rise earlier this year.

He said the economic challenges will persist until deliberate measures to boost production in agriculture, mining and industry are put in place.

“The same problems are identified time and again, but we have actually done almost nothing,” Robertson said.
He said the discord in government has ruined the country’s credibility.

“Investors cannot take us seriously,” Robertson said, adding proper policy formulation procedures should be followed.
“We have ministers thinking they can change laws by making a press statement. Clearly, parliament is being sidelined and I think the IMF would like to see that change.”

COMMENTS

WORDPRESS: 14
  • comment-avatar
    Bill Mills 8 years ago

    One of the two best living laboratories for ‘hard’ demonstrations of certain sociological and economic principles is Zimbabwe. The other is Detroit in the usa. Both were built and run by white people and subsequently turned over to Africans. Detroit was formerly characterized as the ‘Paris of the west’. It is not an exageration to say that it was a great industrial and cultural city. Today it is in terminal decline, and in bankruptcy court. Even the copper wires to the street lights have been stolen so there are very few of them still working. Any house that becomes vacant is immediately vandalized with all electrical and plumbing fixtures stolen and sold. The house is then worthless and becomes a derelect inhabited by bums, addicts, theives, pimps and other ne’er-do-wells.

    The people of Detroit had the excuse that its malaise was caused by the decline of the Automoblle industry which was centered there. But the discerning observer noticed the real cause was incompetence, mismanagement, and looting by the local government which unfortunately was African-American. Several of them but not all are currently in prison. How many Zimbabweans are in prison for such crimes?

    Now Zimbabwe is the most observed laboratory in the world. It was a pearl of a little country that was well and competently run by whites. The water-works, worked. The Electric Utility worked very well with spare capacity. The hospitals were properly staffed. The schools were staffed and worked properly. The money was very sound and properly managed. The extraction industries were world class, and other industries and businesses hummed along surprisingly well.

    Then suddenly–What happened!!

    • comment-avatar
      Tsuro 8 years ago

      Mills your analysis and conclusion is warped and the reason we have the problem we have now also rest at the doorsteps of the white Rhodesians.

      We now have thugs running our country because of Smith’s thuggerism. Thuggerism breeds thuggerism.

      I grew up in the Highfield Township and it seems from my small statistical analysis, 82.5% of my fellow township boys who crossed into Mozambique were people who had become hard hearted because of torment of the Smith Regime. Most boys ana Mkoma Chunky were hard-core criminals and school drop outs.

      It required Barbarians to dismantle the Roman Empire.It required those who had nothing to lose to fight the Smith regime, just as we are witnessing now most MDC members in the lower ranks are mostly unemployed who unfortunately become our councillors.

      It is also a generational problem. Most of these guys who are now running our affairs grew up in deprived families and herding cattle. What happens when you give a mad man a whistle.

      Of course Mandela was different, so it has nothing to do one with colour.

      • comment-avatar
        Swagman 8 years ago

        Unfortunately Mills is right, and it’s not racist, it’s a hard FACT.

        Even black Detroitians admit it was the plunder by their Black Majority City Government, that lost Detroit jobs, industries and commerce to neighboring States like Iowa, Wisconsin, Michigan and Indiana.

        Kevyn Orr (Afro-American) tried to clean up the City, run by other Blacks,(African Americans) – numbering 775,772 or 82% of the population.
        Whites, 10% were outvoted (116,599 12.26%).
        He failed, as ZPF did here.

        Detroit has 47% illiterate, murder rate 11 times and all crimes 5 times the National average. 10 times higher than New York City. Highest unemployment of 50 largest cities, like Zimbabwe has highest unemployment in Africa.

        1 Zimbabwe 95
        2 Nauru 90
        3 Liberia 85
        4 Burkina Faso 77
        5 Turkmenistan 60

        Look up the stats and see.

      • comment-avatar
        Swagman 8 years ago

        Unfortunately Mills is right, and it’s not racist, it’s a hard FACT. Thugs do NOT breed thugs anyway!

        Even black Detroitians admit it was the plunder, mismanagement, greed and cronyism, (Remind you of anyone here) by their Black Majority City Government from 2000 through 2012, that lost Detroit jobs, industries and commerce to neighboring States like Iowa, Wisconsin, Michigan and Indiana.

        Kevyn Orr (Afro-American) tried to clean up Detroit, run by other Blacks,(African Americans) – numbering 775,772 or 82% of the population.
        Whites, 10% were outvoted from 2000 (116,599 12.26%).
        He failed, as ZPF did here.

        Detroit has 47% illiteracy, murder rate 11 times and all crimes 5 times the National average. 10 times higher than New York City!

        Highest unemployment of 50 largest US cities, like Zimbabwe has highest unemployment in the WORLD.
        Look up the stats and see.

        World Unemployment

        1 Zimbabwe 90 (Zimbabwe is first in something)
        2 Nauru 87
        3 Liberia 85
        4 Burkina Faso 77
        5 Turkmenistan 60

        Believe me, it’s not a racist statement, but well publicized FACT!
        Why do you blame Smith, whites, Colonialism and all that bullsh*#t, for this Mugarbage/ZPF Governments inadequacies, theft, mismanagement and greed.

        Accept that they are fools and need to disappear!

    • comment-avatar
      Senzachena 8 years ago

      Smith saw it coming. Things were so much better then.

  • comment-avatar
    Mandevu 8 years ago

    It is not about commitment from government. it is simply that they don’t know what they are doing

  • comment-avatar
    ShabbaRanks 8 years ago

    There is a rumor of a large force of mercenaries building up outside the borders of Zimbabwe, preparing for a surprise attack on the government leadership, army and Mugabe himself.

  • comment-avatar
    KIBBS 8 years ago

    @SR If it is true, which I sincerely doubt, the last thing we should be doing is forewarning The Regime on this forum.
    The demolition of zanupf dictatorship will be carried out by us “The Masses” and it will be done in the streets. It will jointly involve all tribes, creeds, colours and religions. One thing zanupf has been very good at (probably the only thing) is to unite The People in a common hatred of the present Government. Regrettably that day is not yet here.

  • comment-avatar
    Shamhu YeNhanzva 8 years ago

    “Economic revival eludes govt.” No s(h)it!

  • comment-avatar
    zanupf fear me 8 years ago

    Liberation waffle claptrap rubbish laughable nonsensence manure

  • comment-avatar
    Mlimo 8 years ago

    Tsuro. Quite surprising comments the boys crossed the border because you were promised free land , free wealth and free everything. The escape goat was the smith regime. Well you got free farms and free everything except Zimbabwe vets missed one calculation that is that it costs money to have wealth and assets. That’s why everyone is still stealing everything in Zimbabwe because you haven’t realised you have to work for wealth. That’s why Zimbabwe is a mess . And for heavens sake stop blaming your woes on smith. He said blacks weren’t ready to run the country and he was right. And I bet you live outside Zimbabwe . Go back take up a gun and fix the problem as that seemed to be the way before.

  • comment-avatar
    Saddened 8 years ago

    Despite all our bragging about well educated Zimbabweans are, we couldn’t even maintain a country that was running well when we inherited it. Worst of all this government doesn’t know, that it doesn’t know. Educated incompetents!!