By Takura Zhangazha*
In Zimbabwean writer Shimmer Chinodya’s Harvest of Thorns novel, there is a description of the main character’s father, Mr. Tichafa, as
probably having been the best minister of finance that Rhodesia probably never
had. This was because he (the father)
was running the family on a minimum wage budget with what his son considered
amazing resourcefulness.
Some years after high school we would laugh in conversation about
comparing contemporary and even past finance ministers with Mr. Tichafa. Even if from a point of ignorance of how
national and global capitalism operates.
Or how hapless most actual minsters of finance would be. Even if they were trying hard.
I thought of this as I read the Reserve Bank of Zimbabwe’s (RBZ) new monetary policy this week. It was a
policy geared to fit into the overall government’s free market economic policy
(open for business). Also now referred known as neo-liberalism. Hence emphasis as
expected was on ‘ring-fencing’ or guaranteeing (nostro) foreign currency
accounts (FCAs) protection from what it eventually turns out is our own version
of a currency, the bond note. Or the Real
Time Gross Settlement (RTGS).
There were other announcements concerning taxes and other requirement’s
of banks and their users.
But that on FCAs
and RTGS is perhaps the most significant in so far as they both affect a greater
majority of Zimbabweans. This is because
the quest for the US$ is a national pre-occupation.
And it is deemed to give the greatest net
value to transactions or property by many Zimbabweans. Not least because of a lack of trust in any
local currency introduced by this or any other government. In fact, political parties have generally avoided
promising to remove the US$ as the currency of exchange.
So the move was going to cause anxiety and panic. Especially
in urban areas of the country that have had a thriving parallel currency
exchange market. And also because of a patent lack of trust in the government and
the Reserve Bank to retain the value of money in its bond note or RTGS
form.
But the Reserve Bank has taken the risk on the backdrop of
not public trust but more confidence that the ‘market’ will set itself
right. Or at least with a reliance that
Mnangagwa’s government’s policies are enough to revive investor confidence and
loans/guarantees of support from global financial institutions (IMF, AfDB,
World Bank). As long as there is a
strong guarantee of the protection of investments, and private property or actual FCAs.
This is therefore a monetary policy for the haves not the
have-nots. With the assumption of a
trickle down effect to those that are already poor. And as is, the cost of living will invariably
rise for those that cannot access the US$. Or it will at least have a (informal
for now) multi-tier commodity costing system (i.e a price in US$,
bond/RTGS/other). A development that
will point to the fact that the majority of people who do not have access to
the US$ will be living more expensive lives in relation to costs. Or they will simply not be able to afford
basic commodities due to their serious disadvantages over the ‘rating’
processes which at any given point are ‘fickle’.
But as is the tradition of neoliberalism, it will bring out
its intellectual and practitioner guns to defend the move as being the only
rational way forward. True to fashion
they will pretend free market economics never created this problem and offer
the same neoliberalism as the only means to solve it.
What is clearer now is that this government is well aware of
the desperation of many Zimbabweans for want of some sort of economic
normalcy. And it has decided to sun a
people centered approach to economic policy in favour of private international
capital. A process that will mean if
push comes to shove it may decide to ensure it gets its way through greater
political control of dissent in order to achieve its stated objectives.
Others may ask what the alternatives are and the answer can
only be that stable societies are democratic in relation to both their politics
as well as their economic policies. That
is, they guarantee not just political rights but also socio-economic justice
and fairness for the majority of their citizens. With or without the United States
dollar.
*Takura Zhangazha writes here in his personal capacity (takura-zhangazha.blogspot.com)
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