Business calls for confidence building in Zim dollar

Finance minister Mthuli Ncube has on Monday come under fire from captains of industries for introducing quasi fiscal policies that are retrogressive to economic development.

Speaking at a breakfast meeting held at a local hotel, business people and industrialists expressed lack of confidence in government’s policy inconsistency, in particular the recently introduced SI 142 of 2019 which they regarded as an “ambush” to the business people.

Former Zimbabwe National Chamber of commerce president Luxon Zembe blasted  Ncube on the failure to inspire confidence and consistency in policy making.

“Confidence is a function we may demand it or do anything but we earn it.

“We need to communicate and engage and deal with the uncertainties in policy making by our government, like what happened with SI 142 of 2019, 24 hours before its introduction both you and the president where saying it will be introduced in April 2019 but overnight you introduced it and you are creating confusion and uncertainty in the policies and it has killed the economy,“ said Zembe.

Dairibord chief executive Anthony Mandiwanza also weighed in and said government needed to correct policy narrative to sync with reality on the ground in order to build the much needed confidence.

Business leaders said there was communication breakdown between the government and stakeholders leading to the poor implementation of policies which in turn has created confusion in the economy.

Zimbabwe has been having policy inconsistencies since the presidency of President Robert Mugabe, he said.  

Addressing delegates, Ncube acknowledged the importance of confidence building and said the SI 142of 2019  was the last ‘ambush’ policy to come from the government:

“It’s very important that we have predictable policies, which are consistent. We will make sure that reforms are consistent… SI142/19 is probably our last Big Bang change in macro policies. You should see less of that going forward,” he said.

Reserve Bank of Zimbabwe governor John Mangudya corroborated with Ncube and emphasized  the need to build confidence arguing that it was the essential tool to build a strong currency.

 “The biggest currency in any strong or weak economy is confidence…So bad is the lack of confidence in this country that the first thing most Zimbabweans ask when they wake up is ‘ rate nhasi riri pachii (What is the current rate),”

Addressing the pricing of goods, Mangudya said people who charge a transfer price and a cash price are still to trust that the value is equal but once the confidence is restored this willbe a thing ofthepast.

“It all goes back to confidence, this thing of charging in transfer price and cash price is a confidence crisis, but we are in a transition to normalcy and it will be a thing of the past…”

Captains of Industry noted that the problem is that most Zimbabweans have very little faith in the central bank.

The government’s lack of restraint in running the currency printing press and its creation of all manner of monetary instruments have done it no favours.