Respected cleric and a member of the President Advisory Council (PAC), Dr Shingi Munyeza has cited lethargic governance as the major source of confidence deficiency in the economy saying if left unchecked, it poses serious threats to the sustainability of the new Zimbabwean dollar.
Speaking at the Institute of Chartered Accountants of Zimbabwe (CAZ) breakfast meeting on the implications of the currency reforms on business yesterday, Munyeza suggested that for the new currency to be sustained; public sentiment was essential more than resources that backs it.
Memories of the dreaded Zimbabwean dollar that tumbled by tens of thousand percentage points prior to 2009 are still fresh in the minds of many, and Government has done little to instill confidence in the new currency.
“The problem that we are having or we have had, is bad governance, inconsistent policy framework and implementation, toxic politics, contested election results, a bad human rights record and freedoms record. So currency, we all know that 60 percent of the by-in on the currency is based on the confidence that the citizenry have on the currency. I hear a lot of people say it might be backed 100 percent on the resources and so on. There is a confidence deficit that we have,” he said.
This follows widespread skepticism over Government’s decision to abolish the multi-currency system which many analysts believe was rather impulsive.
Munyeza however said the move could have been justified, given the prevalence of speculators on the market which if Government had notified earlier could have caused panic reminiscent of October 2018 when Finance minister hinted of plans to do away with bond notes.
“To bring back confidence, our Government and authorities have to show competence that they are doing the right thing, the right way at the right time. The next thing is that they have to demonstrate that they are accountable or they communicate properly what they are doing. There is ineffective communication on policy,” Munyeza added.
Analysts have often warned of deep seated and institutionalized corruption in the public sector that has been left unabated for years, to the extent that even when Government creates policies, they seldom get the much needed buy-in from the public.
Last week, the Auditor General’s office released its findings for the year ending 31 December 2018, which unearthed gross incompetence and corruption in public offices.
However, with the currency reforms gathering momentum, a cocktail of other factors remain unresolved to prop up public trust and top among them is the independence of the Reserve Bank of Zimbabwe which lately has been accused of meddling in quasi-fiscal activities, continued human rights violations and an unresolved post-election question.