Business Development Opinions

Zimbabwe should not repeat mistakes of the past

Mutisi

By Engineer Jacob Kudzai Mutisi

It is our black government that was behind the death of Olivine, Willowvale, COTTCO, NRZ, Barbican, just to name a few. We do not want the same to happen to Sakunda and Croco Motors.

 

The Minister of Finance and Governor Sirs, the problem is not externalization, it is survival. Zimbabwe business have been operating in a very difficult environment and how they managed to survive is not only a miracle but something out of this world. What is puzzling is how a supermarket, car dealers, pharmacies, agricultural equipment dealers are acquiring forex yet no bank is giving out foreign currency.

 

We have institutions that have survived Zimbabwe’s difficult economic challenges and are still here and feel they should be protected. How on earth does the Government of Zimbabwe expect Sakunda and Croco Motors to survive yet the business they run requires lots and lots of foreign currency and their only source is the black market but our banks do not have any. We have done it before during the late Mugabe’s era when we targeted indigenous banks killing some of the best and well run banking institutions like Barbican Bank, ran by none other than our Professor Mthuli Ncube who is now our finance minister.

 

The problem is not the individual called “Tagwirei” and his companies, the problem is about dysfunctional government policies in general and on the fiscal and monetary arenas in particular. The time has come to call a spade a spade, the problem is not the black market or externalisation that is blame, it is the Central bank RBZ which is not operating Open Market Operation (OMO).

 

Open Market Operations involve the purchase or sale of securities, such as Treasury Bills or Government bonds, by the Central Bank in order to influence the money supply. When the Bank sells (purchases) these securities to (from) a bank or an individual, money is withdrawn from (added to) the flow of money in the economy. The RBZ has become a law on to themselves where in the world do you arrest and then investigate. This is the case with Sakunda and Croco Motors who have their accounts frozen and the FIU is concurring they are “investigating”.

 

This will definitely kill our Zimbabwe’ s indigenous companies who we are suppose to protect. Where does our government expect Sakunda and Croco Motors to keep operating? They need the foreign currency to import fuel, buy cars and parts when the banks are not offering them the any foreign currency. The issue is “Tagwirei” sees opportunities in warped government policies and he uses them to his benefit just as any rational human being would do. Why focus on individual and/or individual companies,why cannot  have a whole some sector by sector investigations and consultation without only singling out a few companies and institutions.

The government needs to review their policies, for example this is the same government that requested our local companies and institutions to stop charging any of Zimbabwe’s products and services in foreign currency yet they are doing the same charging forex on the importation of vehicles. We are a nation that is losing money in a 5 year cycle meaning they introduce a US dollar and abolish it and the cycle is back again. How do they explain a situation where a son/daughter buys his mother/father a car (sedan, SUV, twincab) and expect the father/mother to pay the duty in foreign currency and where do they expect them to get it from. It has to be on the black market.

It is folly for the government to think that if “Tagwirei” is punished then the shenanigans on forex would end, every company or person would do the same, in this difficult operating environment.  The issue is about revisiting RBZ fiscal and monetary policies among other policies and make appropriate workable policies. The central bank must stop the silly approach of quickly blaming players in our economy and not the dictates created in the playing field. If this attack on individual companies is not a diversion by government of the real issues, so when will our government ever take responsibility for the meltdown. It is time for our government and central bank to seek national solutions to keep this difficult economy moving.

Let us face the fact, are these regulations affecting the Chinese and other players? It is time to protect our indigenous players who have kept this economy moving and employing hundreds of employees who still have jobs.

About the author

Byron Adonis Mutingwende