Zimbabwe’s Finance Minister Discusses How To Fix Country’s Crumbling Economy

NPR's Ari Shapiro talks with Zimbabwe's Finance Minister Mthuli Ncube about his mission to turn around his country's crumbling economy.

Zimbabwean finance minister Mthuli Ncube. Picture: THE TIMES

ARI SHAPIRO, HOST:

Zimbabwe’s new president campaigned last summer on this promise.

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PRESIDENT EMMERSON MNANGAGWA: From now on, Zimbabwe is open for business.

SHAPIRO: Emmerson Mnangagwa used Zimbabwe is open for business the way Donald Trump used make America great again. Now, economic signals in Zimbabwe are pointing in the wrong direction. Inflation is above 50 percent. To try to get things on track, the country launched a new currency to replace its old cash system based on the U.S. dollar.

Zimbabwe’s finance minister is behind this move and others. He’s on a visit to the U.S. right now. And professor Mthuli Ncube joins us here in the studio. Welcome to ALL THINGS CONSIDERED.

MTHULI NCUBE: Thank you very much.

SHAPIRO: One very visible sign of Zimbabwe’s economic challenges comes at ATMs in the center of Harare, the capital, where people line up overnight. When I was there back in June, I met people who waited in line for hours just to withdraw $20 from the ATM. One of those people waiting in line was named Rumbitsai Chahara, and she spoke with us through an interpreter. Here’s what she said.

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RUMBITSAI CHAHARA: (Through interpreter) It’s very painful to have to wait for your money, especially if it’s money that you’ve worked for. And it feels like we keep getting pulled back when we should be moving forward.

SHAPIRO: I conducted that interview last June in Harare. And people we speak to in Zimbabwe today say that situation has not improved. What do you say to people like her?

NCUBE: The situation is improving, but improving slowly. But it will improve faster as we go along. You know why? Because what she was queuing for before was U.S. dollars. Zimbabwe does not print U.S. dollars. Zimbabwe does not have an agreement with the U.S. for the supply of U.S. dollars. So money ran out. So – but imagine that now if you have domestic currency that you’re able to print, that you control, then we will not have this problem.

SHAPIRO: But people need to have confidence in that currency, and inflation needs to be low enough that that currency is worth something.

NCUBE: There is reason not to be confident, and I agree with them. The reason was the macroeconomic management – the capacity, the determination, the focus – wasn’t there. That has changed since four months ago since we came in. We are running a budget surplus. We are containing the growth of money supply. We’re determined to give value to the currency that we’ve launched and want people to believe in us. We’re determined to make this right.

SHAPIRO: As we heard, the president, Emmerson Mnangagwa, campaigned on this message of Zimbabwe is open for business. Earlier this year, widespread protests were violently shut down by the military. International investors want to see stability and rule of law before they put their money into a country. Are you concerned that the sort of violent crackdown on protesters we saw will actually scare away international investors?

NCUBE: You know, we had a previous leader of Zimbabwe who was in power for 37 years.

SHAPIRO: Robert Mugabe.

NCUBE: Yes. Let’s be honest. When you stay that long, you become the institution. You erode all other institutions. So when we have a new regime taking over, it just takes time for the institution to settle down and take over. So what happened during that period, the intensity of the protests basically overwhelmed the enforcement – law enforcement agents. It’s very clear. But the president came out very strong, very strong and said, look, I as the president, leader of Zimbabwe, I condemn this violence from both sides. And I think that is a very, very strong statement.

SHAPIRO: It was not just the violent crackdown in the heat of the moment. There was also the arrest of more than a thousand critics and civil society leaders detained without warrants on dubious grounds according to Amnesty International. Does that kind of a crackdown, even outside of a protest, tell the international community that Zimbabwe is not yet ready for being open for business?

NCUBE: As I say, it is really about the ability to cope with such intense protests in a situation where some of the state institutions are not as strong because their power is eroded by a – this leader who was there for too long.

SHAPIRO: You returned home to Zimbabwe to take this job in the fall, and before that, you were the chief economist at the African Development Bank. You taught at Oxford. Now that you are home in Harare working on this issue every day, what has surprised you most?

NCUBE: Actually, nothing has surprised me. Having worked at the African Development Bank, I knew the depths of the challenge of working with Zimbabwe and trying to turn it around. For me, what has probably surprised me is more on the positive side, which is that the Zimbabweans have been – I think there’s a (unintelligible) with the economic reform agenda. I’m hopeful we will see this through. Zimbabwe will be normal again. We’ll turn it around.

SHAPIRO: Professor Mthuli Ncube, thank you so much for joining us in the studio today.

NCUBE: Thank you.

SHAPIRO: He is the finance minister for Zimbabwe.

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