The Sunday Mail
Edmore Ndudzo
An unexpected “crisis” engulfed Zimbabwe and peaked around the weekend of September 30/October 1, 2017.
This so-called “crisis” was characterised by sudden and largely unexplained shortage of some basic goods in shops, and where such goods were found, prices shot through the roof.
Service stations ran out of fuel, with queues quickly emerging at filling stations rumoured to have the commodity – whose prices also spiralled.
Some businesses refused electronic and mobile payments and bond notes, insisting on United States dollar transactions.
Days before this, social media platforms and the private media had been awash with all manner of claims, creating unnecessary panic.
Even I was forced to suspend my fencing plan at the farm on account of the price madness.
Strangely, so-called economic commentators pointed to “the mismatch of some of our socio-economic fundamentals” as being behind the “crisis”.
To appreciate what was being alleged, I will compare and contrast some of these said socio-economic fundamentals leading to the 2008 crisis and to the September/October 2017 “crisis”.
In 2008, Zimbabwe was in the jaws of hyperinflation. Prices were not only volatile, but unpredictable, too.
But in 2017, Zimbabwe is emerging from deflation (negative inflation), and the year-on-year inflation figure is around one percent or a fraction of that.
The Bretton Woods institutions, the World Bank in particular, now predict Zimbabwe will end up with a year-on-year inflation rate of around only two percent by December 31, 2017.
In 2008, shop shelves were virtually empty, and the few goods found then were mostly imports sold at grossly inflated prices, prices that could change hourly. For comparison’s sake, most shops are fully stocked in 2017, albeit still largely with imported items.
Locally manufactured goods are, however, gradually taking their pride of place in shops. There are no less than three locally manufactured cooking oil brands available.
In days leading to the recent “crisis”, fuel was available and its price stable, only responding to periodic global crude oil dynamics.
In 2008, the economy was “screaming”, to borrow from former US assistant secretary of state for African Affairs, Mr Chester Crocker. The rationale behind this man-made scenario was for Western sanctions on Zimbabwe to prompt Zimbabweans to revolt against President Mugabe and his Government.
It was unfortunate that some Zimbabweans fell for this ploy out of selfish interest and played a significant role in the formulation of this evil US strategy.
This strategy, belatedly though, seemed to have worked to near perfection then; that is if the results of the 2008 general election are anything to go by. The Western-backed MDC opposition party nearly “stole” electoral victory in that year.
Contrast this with 2013 when Zanu-PF won harmonised elections convincingly. The party gained further political mileage and strengthened its position on the back of petty intra-party rivalries within the MDC, which subsequently disintegrated into multiple fragments and parties. Also working in Zanu-PF’s favour are the oversubscribed Presidential Youth Interface Meetings.
Pro-MDC think-tanks predict resounding electoral victory for the ruling party come 2018.
In 2008, most Western multinational companies that were historically integral to Zimbabwe’s economy either closed shop or were on the brink as desired by Western powers.
The SMEs sector was largely in its infancy and slowly emerging, though hardly noticeable. Now, the sector is gaining prominence and dominance, growing in leaps and bounds.
Relatively new and emerging multinational companies are mostly those from the East and those under South-South co-operation.
The growing SMEs sector, combined with these investments from the East and South-South arrangements, has been a substitute for job-creation. New job opportunities are being created.
In addition, the economy was obviously in reverse gear in 2008 in terms of annual economic growth.
However, Zimbabwe’s economy is now projected to grow by at least three percent in 2017, having already achieved more than seven percent at the inception of the multi-currency system in 2009.
Nine years ago, Zimbabwe was using its own currency, hence – justifiably – accused of printing money in volumes that were not commensurate with goods and services in the economy at the time.
This was partly a deliberate endeavour by monetary authorities to counter illegal Western sanctions. Foreign currency reserves had dropped way below the desired three months import cover.
But by 2017, the Zimbabwe dollar had long been discarded, with the US dollar dominating the multi-currency basket.
The current account position, however, remains rather unsatisfactory and precarious.
It is becoming unstable given that annual imports are of the order of about US$6 billion against annual exports, including Diaspora remittances and other foreign currency inflows, of about US$3 billion.
Last but not least, and probably most importantly, in 2008 Zimbabwe was in the throes of a major drought that resulted in massive food shortages, among other related and unrelated shortages.
In sharp contrast, however, in 2016-17, the country got a bumper maize harvest and improved outputs of small grains and other crops. Tobacco output was remarkable.
The now familiar Presidential Inputs Support Scheme and Command Agriculture were highly successful.
Now, when all the above socio-economic or even political fundamentals are considered, the cause or origins of the September 30/October 1, 2017 “crisis” become mysterious.
Even the so-called economic implosion of fundamentals (whatever that means) – claimed by so-called economic commentators – becomes most unconvincing.
One smells a rat, a very rotten one.
There is, therefore, need for the powers-that-be to get to the bottom of the matter lest sabotage and/or unholy, treacherous and devilish political machinations gain traction.
Zimbabweans have been inconvenienced immensely and made to suffer greatly on numerous occasions.
Lest we forget, some citizens – in collaboration with Zimbabwe’s detractors – were behind the illegal sanctions imposed on the country. These culprits are known, and partly because of their deeds, Zimbabweans have had to pay a heavy price in terms of social dislocation and ill socio-economic consequences.
It is imperative that the culprits and responsible characters be identified, flushed out, named and shamed, and held accountable.
The latest “crisis” was artificial, unnecessary and uncalled for.
This is also an opportune time for the country to strategise, taking full advantage of geopolitical and socio-economic dynamics on the international stage, particularly the confusion and uncertainty created by Brexit and the recent emergence of an unorthodox, right-wing and unpredictable US regime under President Donald Trump, to try to release Zimbabwe from the burden of illegal sanctions which have been a source of much suffering to its citizenry.
Edmore Ndudzo was the City of Harare’s first black Treasurer and Lead Consultant in crafting the Public Finance Management Act of Zimbabwe (2009). He writes in his personal capacity for and in the public interest.
