After four years of ill-conceived policies, often introduced to appease the political leadership of the country, Gono – tasked by President Robert Mugabe to resuscitate Zimbabwe’s comatose economy – is beginning to pay for the extravagance of his four-year term at the helm of the central bank.
Gono announced at the weekend that the central bank was shelving the introduction of a new currency. The central bank has twice so far developed cold feet on the new currency.
According to consultant economist John Robertson, Gono is caught between a rock and a hard place and would have to move faster to stem further deterioration of economic conditions or risk completely losing the war on the economy.
Robertson agreed with Gono that introducing the new currency would not be a wise move and said the central bank chief must seriously act on the runaway inflation as the first step to normalising the economic climate and improving the supply of goods.
“However, you cannot beat inflation while you continue to print money to finance unproductive activities and while you continue to suffer foreign exchange shortages. These are issues that the governor must address first before any talk about normalizing the situation and launching the new currency,” Robertson said.
“He is now caught in a net that he himself willingly helped to cast because everything that they are now trying to adjust right now is the culmination of years of bad policies that started with the appointment of Gono as governor of the reserve bank in December 2003,” said a Harare-based investment banker who refused to be named for professional reasons.
He said launching the new currency would be the toughest challenge faced by the central bank governor since his appointment. – ZimOnline
Post published in: News