Tendai Ruben Mbofana
Over this past weekend, information minister Monica Mutsvangwa was in rural Manicaland province, where she placed all the blame for these skyrocketing prices on entrepreneurs – whom, she alleged, were being motivated by greed and profiteering.
She proceeded to praise President Emmerson Dambudzo for lifting duty on the importation of some basic products – touting this as countering these business people’s nefarious activities.
In all this diatribe and false accusations by Mutsvangwa, she curiously omitted to enlighten her rural audience that the real reason the costs of purchasing goods and services in the country were rising so frighteningly high was on account of a rampaging exchange rate.
She never saw it fit, or beneficial to the ruling establishment, to mention that – due to Mnangagwa’s skewed schizophrenic economic policies, the Zimbabwe dollar was now trading at $2,500 to US$1 – on the much-used parallel market, where most businesses (producers, manufacturers and retailers) acquired their foreign currency.
It is not rocket science, due to obvious reasons, all prices in Zimbabwe are pegged to the US dollar – and, as such, volatile and directly affected by movements in the exchange rate.
Every Zimbabwean knows this fact, since even street vendors or those selling eggs – including ZANU PF supporters operating their ‘empowerment projects’ – follow the same principle.
Does it, then, mean that the Mnangagwa administration is also accusing them of greed and profiteering?
Are eggs and chickens sold by ZANU PF members cheaper than those by ‘profiteering businesses’?
There was no way Mutsvangwa could tell them such truths when this would have exposed the real reason prices were increasing at such a horrific rate.
Why would Mutsvangwa, and any of her colleagues in both the ruling party and government, let their constituencies aware that those in power had dismally failed to manage our local currency – thereby, running berserk and on a freefall?
Even attempts at rigging the official foreign currency exchange market – the RBZ (Reserve Bank of Zimbabwe) auction system – have failed spectacularly, as it has adamantly refused to be manipulated.
As we speak now, the official exchange rate is similarly spiralling out of control at ZW$1,200 to the greenback – which is still unacceptably high, even though ominously lingering below the parallel rate.
Seriously, whatever rate one uses – the prices of basic commodities (or any other goods and services) in Zimbabwe will always be beyond the reach of the vast majority.
Let us remember that, at least two-thirds of the workforce is earning far below the poverty datum line, as half the population languish in extreme poverty (making less than US$1.90 a day).
As such, any exchange rate above double digits is a nightmare for ordinary Zimbabweans.
It, therefore, becomes ridiculous and utterly disingenuous when the ruling elite attempts to place the blame for the skyrocketing prices on businesses.
Surely, even if Mnangagwa himself operated a shop – what prices would he charge for his goods and services – which are ‘acceptable’, and not driven by profiteering?
How much would he sell a loaf of bread in the local currency, for instance?
Our villagers and townsfolk need to understand that even farmers – who are the primary producers – now demand hard currency (US dollars) for their products, in order to meet rising costs – in an environment where the Zim dollar is virtually useless.
In so doing, if maize growers want US dollars, and millers also demand the same – in which currency are retailers expected to charge for mealie meals?
The onus for mending this chaos and catastrophe is squarely on Mnangagwa’s doorstep.
For the past five years, he has struggled, with minimal success, to tame this jungle – as promises have been repeatedly broken, whilst confused and faulty stopgap measures falling apart as soon as they were implemented.
Nonetheless, Mnangagwa knows the way to go – but he does not want to admit the failure of the local currency, by ditching it for the more stable hard currency.
It is, nevertheless, no huge mystery to understand why the ZANU PF regime refuses to concede this fact.
One of the main reasons is that the continued use of an unstable local currency benefits cartels linked to the ruling establishment – who are smiling all the way to the bank, through arbitrage – as they buy cheaper US dollars on the RBZ auction system, after which reselling them on the back market for a killing.
This is further exacerbated by the paying of various contractors awarded tenders by the government – most of whom are, again, aligned to the ruling elite – who offload their Zim dollar payments on the black market for the much safer greenback.
As such, doing away with the useless local currency – which common sense dictates is the most logical thing to do – would work against cartels aligned with those in power.
Admittedly, no country on this planet can go on without its own currency – which is also beneficial in boosting local industry and commerce – as we have witnessed over the past few years.
However, Zimbabwean authorities are not interested in managing the local currency in a way that is good for the country.
If the Mnangagwa regime was serious, they would allow for a floating exchange rate – which is determined by market forces of supply and demand – as opposed to the prevailing rigged system.
As such, the continuance of the current economic mismanagement can only lead to more suffering for the ordinary citizenry – who become powerless victims of a rabid exchange rate.
There is no way Zimbabweans can hope to survive at the speed at which the economy is on a freefall and speedily crumbling – more so, as the vast majority earn their salaries in the local currency.
These are the truths that Mutsvangwa and her colleagues in both the ruling party and government will never tell their captive audiences in the rural areas.
They will never let them know that the real reason that prices of goods and services have become unaffordable is entirely as a result of an exchange rate that has gone rogue – thereby, forcing up prices of basic commodities – as producers, manufacturers and retailers struggle to make ends meet.
In addition, the blame lies squarely with those in power, who are stubbornly refusing to either properly manage the foreign currency exchange market, or alternatively ridding the country of these useless Zim dollars.
Our people have to understand that the unimaginable suffering we are enduring is a direct result of a government that is more interested in enriching their cartel friends, and themselves (in the process).
Yet, the ordinary citizenry continues to wallow in poverty, with no hope in sight.
In other words, the Mnangagwa administration does not care for the people of Zimbabwe.
Those are the truths that all of us need to know.
- Tendai Ruben Mbofana is a social justice advocate, writer, researcher, and social commentator. Please feel free to WhatsApp or Call: +263715667700 | +263782283975, or email: mbofana.tendairuben73@gmail.com