The Sunday Mail
“Zimbabwe’s economy is at a crossroads. The economic situation remains difficult.”
This is the message that the IMF gave us in the month of the goat in 2014. At least the message did not require us to celebrate for taboo had shut down all festivities as is the case with any November.
Numbers seem to agree with the Fund … talk of indicators like industrial capacity utilisation, revenue collections, you name it.
Indeed, the economic situation remains difficult.
Recent financial reports from different companies testify to this. Innscor Africa said: “The six months under review have been extremely difficult for the Group.” MBCA said, “The operating environment remained challenging.”
National Foods said it recorded “subdued performance” for the half-year. Truworths said retail trading conditions are expected to “remain difficult”. Again, Colcom said trading conditions “remained difficult”.
Not insurmountable, though!
We are just at “crossroads” and the search for optimal solutions seems to be in full force. Killing the economy was one of those solutions, and now it’s very dead – the old economy that is. A new economic dispensation has risen from the ashes, like a phoenix.
Just not too sure if we also succeeded in killing the old methods and principles to come up with new ones that are compatible to this new economic paradigm. Or the old ideas still apply to the new economy? Talk of putting new wine in old skins. Somebody said the skins might burst!
Boom! The 2008 Global Financial Crisis is evident to this assertion, how it left the economics discipline not only embarrassed but exposed of its shortcomings.
Decorated economist Paul Krugman observed that “There was nothing in the prevailing (economic) models suggesting the possibility of the kind of collapse that happened” in 2008.
Radical economics students from the University of Manchester also started to criticise economics courses for doing little to explain why economists failed to warn about the financial crisis, leading to establishment of movements such as the Post-Crash Economics Society and Rethinking Economics.
Just how effective are the economic concepts we always give reference and reverence?
Can we afford to take the economics-as-usual stance in light of these boisterous challenges of the day?
John Maynard Keynes said something very interesting in 1936 when he threw down the gauntlet on the conventional economic discourses aggravating the Great Depression.
“The ideas of economists, both when they are right and when they are wrong, are more powerful than is commonly understood. Indeed, the world is ruled by little else. Practical men, who believe themselves to be quite exempt from any intellectual influences, are usually slaves of some defunct economist.”
Let me hasten to give a heads-up to policy-makers: in coming up with economic solutions, it is vital to avoid trying to solve one macroeconomic problem by distorting another macroeconomic fundamental.
And the austerity tendencies, already evident in our methods, are just the right ingredients to spoil that broth if not carefully interrogated.
We should weigh our priorities right, and give them commensurate attention.
There were times when inflation was declared “enemy number one”. I guess it’s no longer the case now as the current inflation has been said to be a “good development” by those whose job descriptions include writing the monetary policy.
So, what is our number one enemy now? In any case, was inflation ever the worst macroeconomic issue under the sun?
Recent research has established that unemployment is much more damaging to society than inflation, and that most central banks’ disproportionate focus on the level of consumer price growth is misguided.
Blanchflower et al found that every one percentage point increase in unemployment rate lowers well-being five times more than an identical increase in inflation.
It is undeniable that our economic fundamentals are changing as we get more revelations about the reality of the situation we find ourselves in.
A quick instance would be Government’s vow in the Memorandum of Economic and Financial Policies (2014-15) that: “Like we did in 2013 and 2014, we commit to granting only one salary adjustment in 2015.”
Now we are talking about wage freeze. Another instance would be Finance Minister Patrick Chinamasa’s vow several months ago that no civil servant would be retrenched, but focus would be on growing the economy so that revenue inflows will grow.
Now we want to retrench them.
The point I want to make here is that these resolutions ought to be inspired by what weighs heavily on the priority scale. There is no reason to panic as we approach these things.
Let us be calm and gentle – at least those are the demands of this Year of the Goat, according to the Chines Zodiac.
This and that
I don’t want to forget to say how distasteful I found South Africa’s King Zwelithini’s pronouncements about immigrants in that country, including a sizeable number of Zimbabweans.
The king complained about what he called an “influx of foreigners” whom he wants to go back to their countries.
We sing the same Sadc anthem with South Africa, which partly goes as follows: “Towards our people’s unity and harmony.” We should celebrate the ties that bind us as a region, as opposed to wanting to cut them.
Zimbabwe is a huge market for South Africa’s products, with estimates saying that not less than 60 percent of our retail shelf is occupied by foreign products.
And who is the biggest exporter of finished goods to Zimbabwe in the world?
I also remember pointing out in past writings that local companies should label their products as GM-free to win over consumers.
World Consumer Rights Day, celebrated on March 15, also emphasised the need for healthy eating, running under the theme “Helping consumers choose healthy diets”.
Some local mealie-meal manufacturers have started to highlight that their products are GM-free. Food outlets are also indicating that their chickens are not GM.
Has there been any commercial release of GM animals for human consumption, anywhere in the world, to date? No, the Biotechnology Authority of Zimbabwe’s website can give a quick answer.
There are reasons why some chickens look excessively big and tasteless, and that they are GM is neither here nor there.
So, it was International Day of Remembrance of the Victims of Slavery and the Transatlantic Slave Trade on March 25.
It will be International Day for the Remembrance of the Slave Trade and its Abolition on August 25. Again, it will be International Day for the Abolition of Slavery on December 2, hardly a day after commemorating World Aids Day.
Three days dedicated to commemorate slavery issues. And the wording is virtually the same.
Perhaps the difference is just the resolutions under which the days came into being. Be that as it may, why can’t we just harmonise these days into, say, International Day for the Remembrance of Slave Trade, the Abolition of Slavery and Victims of Slavery?
It will hold special meaning if it’s just one day of the year, a unique moment of the year, just like the International Day for the Elimination of Racial Discrimination, which only comes on March 21.
We don’t want to spend the whole year thinking about slavery, well at least I don’t.
