"Until Then, Govt Can Never Win The Exchange Rates War" ECONOMISTS
Economists have urged the government to swiftly apply holistic and long-term solutions to the currency crisis or risk have a recurrent issue.
Persistence Gwanyanya, Godfrey Kanyenze, John Robertson and Prosper Chitambara told New Zimbabwe in separate interviews that temporary solutions were not the panacea to the country’s woes.
Gwanyaynya observed that the move to freeze bank accounts of companies, including Sakunda Holdings, alleged to have been involved in money laundering was not sustainable in the long run. He called for permanent solutions and ditching of the current short-term stopgap measures.
Kanyenze observed that since 2017, president Mnangagwa’s administration has been responsive rather than proactive. He observed that the government has, at an unhurried pace, also been implementing ill-planned and insufficient solutions.
Prosper Chitambara observed that the issues were entrenched in the social and economic set up of the country. He said:
When 95 % of the economy is informalised, it means that speculation and indiscipline is rife. There are a lot of underhand dealings in such a context and unless such problematic situation are addressed, government can never win the exchange rates war. Key economic fundamentals created through social dialogue must be urgently resolved in order to permanently solve the problems.
Robertson also queried why it had taken the government forever to deal with known culprits of money laundering.
Following the RBZ move to freeze bank accounts in question, exchange rates tumbled.
The scarcity of foreign currency worsened when the tobacco market season came to an end. With the local industry in a parlous state, demand for foreign currency will continue to soar.
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