OPINION: Open letter to my President

Our country is currently faced with a myriad of challenges, many of which can very easily be overcome with minimum effort, some originality and innovativeness, and last – but not least – guts and clarity of minds and ideas.

Coins

The Reserve Bank of Zimbabwe Governor was reported to be planning to visit Bulawayo very shortly (or may actually have already done so) with the primary objective of educating key stakeholders in that city on the merits of bond coins.

This, in my opinion, is/was an unnecessary waste of effort and time.

It is as if Zimbabweans have a choice to make in this matter that is clearly in their interest and for their obvious convenience and benefit.

We should utilise all bond coins secured so far to demonetise Zimbabwean dollar balances. Should there be any surplus outstanding after this, direct it towards settling Government’s domestic debt on Zimbabwe dollar denominated prescribed liabilities.

We can use the cut-off date of January 1, 2009 or December 31, 2008 for this purpose.

Should there be shortages, float more US$ denominated Treasury Bills to close the gap.

Concurrently with the above measure, immediately introduce Zimbabwean dollar coins sitting idle in RBZ vaults and elsewhere, for the primary purposes of change, in place of items such as tokens, sweets and credit notes.

Surely even those who appear to suffer from the financial trauma, hallucinations and nightmares of years gone by should appreciate the feasibility of such a measure.

The Z$ coins – like bond coins – will be at par with US$ coins.

As a proud nation, we should desist forthwith from the unbecoming and unpatriotic bias against our own currency and end the repetitive and now tired demeaning of the same.

This is more so given the obvious fact that the demise of the Z$ was precipitated in the main by hyperinflation, itself the direct consequence of illegal Western sanctions imposed at the behest of some of our very own citizens.

Ironically these very same people are now at the forefront of lambasting the local currency.

We should not bother to consult or even seek permission of the Breton Woods institutions on this matter, which is essentially a domestic survival and housekeeping issue.

Corruption

Zim-Asset can never be successfully accelerated, as resolved at the Zanu-PF Congress of December 2014, unless and until the scourge of corruption is thoroughly and expeditiously exorcised. It is also common cause that urban councils have let down the citizenry very badly.

Ratepayers should thus be availed another democratic opportunity to select better officials in councils, and the sooner this is done the better.

Some of these urban councils have become a law unto themselves, disregarding court rulings and even violating their own rules and regulations with impunity.

During my time in City of Harare, some Zanu-PF-led urban councils were dissolved by Zanu-PF ministers for far less serious shortcomings and misdemeanours than we have to contend with today.

It would be folly to expect Zim-Asset to be implemented, let alone accelerated, under the auspices of some of these urban councils.

Having carried out a cleansing of Zanu-PF, a clean-up should be extended to technocrats in the totality of the public sector as well as of corrupt, dubious and incompetent actors in the private sector NGO community.

Corrupt tendencies in land allocations, housing co-operatives, the police and judiciary are known and action should be taken without further delay.

Zim-Asset can never be successfully implemented without dealing decisively with the scourge of corruption bedevilling the country.

 

State Guarantees

The Zimbabwe Asset Management Company (Zamco) has so far taken over US$65 million worth of non-performing loans from financial institutions.

Zamco should only purchase the appropriately discounted capital portion of secured non-performing loans, leaving financial institutions to write off the interest portion (including that on capitalised interest), against provisions for doubtful debts.

The moral hazard, which the RBZ Governor appeared to refer to when speaking against the purchase of unsecured non-performing loans arising primarily from reckless and imprudent lending by these institutions, should thus be minimised.

Further, charging of extortionate interest by financial institutions should never be condoned.

The Government guarantee recently extended on the US$100 million facility from a Chinese financial institution should likewise be extended to agriculture and SMEs in other economic sectors. The apparent merry-go-round and seeming endless efforts between the concerned ministries and Bankers’ Association of Zimbabwe on the issue of the bankability or otherwise of land 99-year leases and special permits should be resolved by issuance of State guarantees. With such action, Zim-Asset will indeed be accelerated in no small measure.

2015 National Budget

The 2015 National Budget went through both Houses and now enjoys the President’s consent.

Outstanding payments to farmers for deliveries to the Grain Marketing Board stood at US$52,6 million.

The rains are generally good, if not excessive in some areas.

Suppliers of agricultural inputs are generally well-stocked but run the real risk of not being able to dispose of most of their stocks before this season ends. Items such as seeds expire.

I recommend that farmers owed money by GMB and who require agriculture inputs be offered these through the GMB depot network or other convenient sources.

Also to be availed these inputs are farmers who were cheated by Lasch Enterprises, which abused Zanu-PF’s good name.

The above measures are made the more urgent and important by the devastating effects of floods.

The amnesty extended by the RBZ for repatriation of forex and/or regularisation of foreign exchange transactions irregularly conducted in the past, which expired on December 31, 2014, should be extended to expire at least on June 30, 2015.

The tax amnesty previously meant to expire on December 31, 2015 but revised to March 31, 2015 should preferably expire on the original deadline or at least on June 30, 2015.

The long outstanding Civil Service Review and Rationalisation Programme should be linked with the collective bargaining exercise for 2015, if one is on the table.

The operationalisation of the Sovereign Wealth Fund should be instituted forthwith.

There are calls to the effect that the SWF and pension funds, should finance infrastructure development. However, the SWF is empty and most pension funds have huge actuarial deficits.

Finally, Your Excellency, the nation stands proud on your elevation to the highly prestigious position of Chairman of the African Union in January 2015, following closely on your election to Chairman of SADC in August 2014.

Those who think these are ceremonial and rotational positions are living on cloud cuckoo land and maybe should best be left undisturbed in their deep slumber.

It is interesting to note that our Zim-Asset has been fully endorsed and taken on board in the AU’s Vision 2063.

The nation can ill-afford now to waste time and effort pursuing unwise agendas such as the IMF’s Staff Monitored Programme.

◆ Edmore AM Ndudzo was the first black Treasurer of the City of Harare (1983 to 1993). He is a chartered accountant and certified public accountant. Ndudzo was the lead consultant in the compilation of the Public Finance Management Act of 2010. He can be reached at [email protected]

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