2018: Poll year with a difference . . . Commodities availability sustained . . . Less political disturbances . . . US Dollar needs to be quarantined

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President Mnangagwa

Hebert Zharare
One and a half weeks before the country conducts one of the polls to be remembered as a game changer in Zimbabwe, there are intriguing developments unfolding that have never been experienced in the history of recent plebiscites.

The majority of stakeholders responsible for polls conduct are unanimous that so far so good.

Shortly after reading “so far so good,” no doubt there are many who will become slightly confused as to the direction and complexion of this argument.

Indeed, this is not the first time the country has held such watershed plebiscites as and when they become due according to the dictates of the country’s national constitution, several have been conducted.

Interestingly this time around, 23 presidential candidates have registered with the Zimbabwe Electoral Commission (ZEC) to participate in the forthcoming harmonised election.

However, indications are the battle lines are drawn between revolutionary party Zanu-PF leader Emmerson Mnangagwa and MDC Alliance representative Nelson Chamisa.

Mr Chamisa

The other presidential hopefuls if the truth is to be said, are just there to split votes, maybe, in the process spoil other candidates’ chance to garner 50 percent plus one vote of the total vote cast to claim victory in accordance with the national constitution.

However, plainly speaking, there are intriguing developments that characterise this period running to the July 30 harmonised elections that many Zimbabweans have experienced.

Zimbabweans should not be blamed if they are persuaded to believe that maybe, former president Mr Robert Mugabe, might have been responsible for some of the misfortunes that befell the country every time there was a national election of this magnitude.

Basic Commodities Availability

In recent years the business sector has been slammed for pursuing a political agenda working with opposition parties to create an artificial shortage of basic commodities in the country ahead of national elections.

There has been a sustained trend in previous poll years where basic commodities such as mealie-meal, cooking oil, sugar, rice among others including fuel, disappeared from shop shelves, with businesspeople giving non-economic fundamentals to justify the shortage.

The country had reached a situation where ordinary people dreaded national elections as they had become synonymous with many ills including food shortages. In the process small businesses still battling to establish firm roots went under — so unfortunate. However, this election period is different as no cases of shortages have been reported so far save for some cases of erratic fuel supply in some areas that have been attributed to logistical challenges. Otherwise the run up to July 30 harmonised elections actually coincided with the opening of new companies among them Varun Beverages (Pepsi,) a scenario that has triggered downward movement of prices of beverages.

The Zimbabwe National Chamber of Commerce chief executive Christopher Mugaga, agreed this time unlike previous polls there was sustained supply of nearly all commodities.

He attributed the obtaining situation to market confidence and a political set up that has demonstrated willingness to listen to the concerns of the industry. It therefore, means Zimbabweans in general, the business community, donors and the diplomatic community had problems with the leadership style of former president Mugabe, hence the sabotage that followed.

Said Mugaga: “The availability of products on the market might mean imports which means we are thriving on borrowed economy. It might also mean trade policies that are desired such as SI 64, but still that brought the challenge of goods smuggling. Generally the availability of the products entails market confidence with the system and the political set obtaining in the country.”

Currency Challenges

The country is operating on a basket of multiple currencies with the most preferred ones being the US dollar, South African rand and the local Bond Note. All has not been well with the $500 million Bond Notes backed by the Afreximbank facility having disappeared from nearly all banks and are now awash on the unofficial market.

The companies are now queuing at the Reserve Bank of Zimbabwe to receive foreign currency, but the bank operates on a priority list basis meaning those deemed not essential might spend longer period on the queue, resulting in some of them getting foreign currency from the open market for higher premiums of up to 80 percent.

This has triggered price instability and a suspicion that companies getting their allocations from the RBZ were also charging higher prices, much to the disadvantage of the general consumers. This therefore rekindles the debate of should Zimbabwe have its own currency or not.

History, however, is yet tell a country that became a superstar after abandoning its currency and adopting the US dollar as the official trading currency.

Said Mugaga: “On the currency issue, we have reached swansong, the tail end of the multi-currency era. The country made a huge blunder by allowing the multiple currency to stay for too long. By now we were supposed to have introduced our own currency. The US dollar was supposed to be just a plug filler.”

He is of the opinion that the unavailability of cash on the market also entails lack of confidence with the banking sector.

If the reports of people being found with huge amounts of cash are true, it therefore means foreign currency in the country is awash and only strategies to harness it without triggering a rate explosion are needed and that is the duty of the monetary authorities.

Mugaga warned some authorities in the country against making reckless statements that disrupt an already fragile situation.

“The RBZ statement recently that individuals should not get some US dollars means you are chasing away the dollar. The individuals should be allowed to generate foreign currency. The import bill is going up as a result of individual imports.

“In Zimbabwe you can no longer talk of individuals and firms, infect, its individuals who are importing more than firms.”

“The shortage of foreign currency being experienced is a result of the bond notes. You thought you put $300 million bond notes on the market and they started infecting the US dollars. We failed to quarantine the US dollar. Remember on introduction of bond notes Mangudya (RBZ governor) said you will be seeing less bond notes than US dollars. All of a sudden bonds notes were all over the market and it cost some individuals.

“We now have imaginary money and real money is not there. The RTGS balances are a form of devalued Zim dollars and those are not of the same values with the US dollar. That is the reality that others do not want to accept,” he said.

Way forward on currency challenges

There is no way two currencies can be operated in one bank account, Bond Note and US dollars no matter the assumption they are of par value.

Those techno savvy say the banking sector ITC systems can allow a client to operate even four accounts including of say rand, US dollars, pulas and sterling pound without any administrative challenges.

Those who had US dollars on introduction of Bond Notes in their bank accounts can claim it today but chances are high the bank will be unable to deliver on demand.

“We need to sterilise all the RTGs balances and I am sorry to say we need to dollarise again. We should have proper Foreign Currency Accounts. When Government need money it should not ask the RBZ to look for it but go to the market. The Government should listen to business concerns,” said Mugaga.

Political Violence

Although currency problem seems to be the major problem bedevilling majority of the people as the country prepare for the harmonized elections, at least measures such as plastic money the authorities introduced have helped to ease the problems.

Political violence that has been the major challenge experienced in previous polls, where reports abounded that some opponents of certain political parties were attacked by their rivalries are minimum if not non-existent in some areas.

People’s rights regardless of their political affiliation have to be respected and no one has legitimate power to attack any one no matter that you do not share the same political ideology.

Those cases happened during the previous dispensation and President Mnangagwa is on record that the July 30 polls should be conducted in free, fair and violence free environment so that those who win do so gracefully and losers will accept defeat with humility.

Credit should go to President Mnangagwa who has avoided names calling in all political rallies he has addressed countrywide so far.

The run up to the polls has indeed, showed Zimbabweans are peace loving people and in previous polls, there were some elements in higher offices that fanned political violence.

Therefore, as the political belligerents travel around the country canvassing for support, the message should be economy, economy, economy and no name calling.

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