Victoria Ruzvidzo In Focus
The Reserve Bank of Zimbabwe (RBZ) and other arms of Government should remain vigilant in their quest to subdue a potentially destructive wave of errant behaviour that has swept across the economy, particularly in recent weeks. It is an unhealthy trend that cannot be justified or accommodated if the economy is to grow.
The panic buying that hit the country over the weekend, which some have justified somewhat, is a phenomenon we would rather discourage and not support due to the deleterious effects it has on the economy. The happenings of 2008, characterised by hyper inflation and empty shelves would rather be avoided at all costs for the sake of the economy. Long queues at fuel stations, hoarding of groceries, a thriving foreign currency parallel market are all ingredients for disaster.
While we cannot necessarily blame consumers for reacting to news that shortages and price spikes reminiscent of 2008 were looming as circulated on social media, the same cannot be said about those that authored the news or the strategy. Whatever could have informed or misinformed this move? Was it a sincere effort to warn the people and ensure those that reacted would have some food in their pantries ahead of “anticipated” rainy days or was there an ulterior motive? These are some of the questions that have either been partly answered or remain unexplained. But the effect of such a wrong turn have been felt in the economy over the past few days.
Of course we will not pretend that the economy is firing from all cylinders, but it remains a fact that it has deep-rooted challenges and macroeconomic fundamentals that need to be sorted sooner rather than later. But Zimbabweans are generally a resilient lot, they have submerged and emerged out of droughts and other vagaries that have afflicted the economy, but alongside there is a tendency to self-destruct that can only be attributed to panicking.
Recent developments have made a few issues clear, that Zimbabweans are still to get over the experiences of 2008 and will react immediately to fears or the slightest hint that such harsh realities of that period are about to visit them again. It remains an era they would just refer to in jest or as a point of reference without having to experience it again.
That social media now appears more dangerous than helpful if abused, is no longer news. It has caused untold suffering in many instances and yet it is also an avenue to share information and progressive developments. However, in this instance it has done more harm than good. Sending messages of panic buying and “warnings” of impeding danger have had negative effects that could have been avoided or managed in a less harmful manner.
The jury is still out on whether the reaction by consumers was natural and, therefore, justified or whether the people behind this are myopic or can just not comprehend the adverse effects of creating artificial shortages. Last Saturday the social media was awash with rumours that they would be a serious shortage of such basic goods as cooking oil and sugar, while in instances where these could be found, the prices would have gone up significantly. Photos were posted of consumers hoarding stuff, but nothing prepared me for the sight that confronted me at one wholesale shop a few kilometres from the city centre.
I became suspicious when I saw all sides of the parking lot full to the brim as has never happened before. It was a hive of activity as trolleys full of groceries moved up and down the aisles. Nothing prepared me for the picture that I saw inside, as at least 10 selling points had queues of shoppers pushing trolleys full of basic consumer goods, stretching more than 30 metres. I did not join the queue, and I did not panic either. I was just shocked by the sudden turn of events.
We may spend acres of space interrogating the causes, manner and form of this while spending time and resources tracking the few individuals that we think sponsored the panic that saw queues everywhere in town, but economic trends would show the growing foreign currency and bond note parallel market that has become an albatross on the economy.
The black market is also a result of the shortage of foreign currency and local bond notes. So, effectively, it all boils down to the need for implementation of measures to restore normalcy in the economy. RBz Governor Dr John Mangudya has said it repeatedly that high production levels and increased exports will trigger higher export earnings. In the interim these initiatives are being complemented by the vigilant stance taken by the Government and the central bank to restore normalcy immediately. The clampdown on the parallel market and investigations into retail and wholesale shops should bring prices to normal levels.
We commend business leaders and other stakeholders for singing the same tune with Government in denouncing the profiteering mentality and price hikes that are detrimental even to the very existence of the businesses and individuals themselves. As the Minister of Finance Patrick Chinamasa, Industry Minister Mike Bimha and Dr Mangudya have said, in this economy there should be no room for mayhem, but that we should all team up to resolve challenges.
This is not to exonerate the authorities on what they should themselves do to create a more enabling environment where companies have enough foreign currency, while individuals should be able to access their deposits and savings without breaking an arm and a leg. The economy has gone through a rough patch over the past few decades and all should be done to salvage the situation. On its part, the Government must do all in its powers to ensure the macro-economic fundamentals come right while the private sector and other players should do their all to aid economic development, instead of engaging in practices to sabotage the economy. There can never be any justification for that.
The $600 million Africa Export and Import bank facility secured by the RBZ should go a long way in ameliorating the situation. The central bank is understood to be allocating at least $30 million every week for critical imports such as fuel and electricity.
The Confederation of Zimbabwe Industries has confirmed that backlogs of foreign currency payments have been dealt with already. Above all President Mugabe stated in no uncertain terms as he arrived from the United Nations meeting, that the Government would not sit and watch as certain elements collude to destroy the economy. We would want to believe that his powerful message and warning has been heeded.
We need not lose focus on the goals of achieving positive economic growth this year. Anything that threatens this must be addressed effectively and expeditiously. Let’s not allow errant behaviour, but at the same time lets address that which causes or ferments such acts. A quick survey has shown that basic consumer goods are still available in supermarkets and the retailers association and manufacturers have pledged that supplies are available. They have the capacity to resume normal supplies within a week.
We all benefit from oiling the economic engine, instead of exaggerating the state of affairs and overburdening the economy through errant behaviour and decisions that are harmful to the economy.
In God I Trust!