Thirteen cents an hour in Zimbabwe

‘Economic stabilisation’ measures have had the exact opposite effect.
Thirteen US cents an hour to care for a child or elderly or disabled person in Zimbabwe. Image: Moneyweb

With my head swirling trying to make sense of the latest economic absurdities in Zimbabwe I set out into the mist early in the morning.

Winter is coming, sunrise is at 6.14am but the mist hangs around in the valleys longer each day, hiding trees and kopjes, rocks and rivers, and it often takes the sun three or four hours to burn through and let us see what’s really there.

At the first corner on the path three zebra suddenly emerged from the mist, they were grazing and looked up but didn’t run, my scent obscured in the mist but their stripes startling against rocks and golden grass.

Priorities

Every morning in Zimbabwe you look at your phone first thing, not for the time, date, weather or missed calls, but for the exchange rates.

Every day we have to make a note of three critical pieces of information in order to survive the latest economic crisis in Zimbabwe.

As usual there’s nothing simple about it, in fact it’s about as clear as the trees and rocks hiding in the mist.

There’s the RBZ (Reserve Bank of Zimbabwe) rate, the interbank rate and the street rate:

  • The RBZ rate is the exchange rate set by government for the US dollar;
  • The Interbank rate is the rate widely used to quote for goods and services; and
  • The street rate is just that, the amount you can get for your US dollars if you buy or sell them on the street.

In the last fortnight new ‘economic stabilisation measures’ were introduced.

Appealing to ‘the youth’ to expose businesses that he says are “sabotaging the economy,” President Emmerson Mnangagwa said: “We are aware that there are people who are working with detractors to bring about regime change through the manipulation of our exchange rate and unjustified price hikes.”

Ho hum, here we go again. The Zim dollar lost almost 50% of its value overnight.

Look at these numbers since my last column a fortnight ago to get an idea of how crazy everything is again …

US$1 in Zimbabwe dollar terms
RBZ rate Interbank rate Street rate Inflation
May 5 159 310 360 207%
May 9 275 310 450 207%
May 13 278 310 450 256%
May 20 291 340 450 256%

‘Stabilisation’?

The ‘economic stabilisation’ measures did the exact opposite of stabilising anything and included:

  1. Banning banks from giving loans; this immediately left companies stopping payment of dividends, agro-processing companies writing to suppliers saying they were suspending advance payments, and even abattoirs telling farmers to stop supplying livestock.
  2. The retention of a 2% withdrawal tax on Zimbabwe dollars.
  3. A new 4% tax to send USD locally.
  4. A 2% withdrawal tax for nostro accounts (local accounts that contain foreign currency).
  5. 40% capital gains tax on shares sold before nine months.

Zimbabwe Congress of Trade Unions (ZCTU) Secretary General Japhet Moyo said: “We are concerned about the nocturnal announcement of these measures without any social dialogue.”

He said the ‘economic stabilisation measures’ could trigger massive job cuts.

A week later the RBZ said the suspension of lending didn’t apply to tobacco, cotton, sugar and maize.

Then, in what was called a political move to “calm a restive population”, the government announced the suspension of import duty on a number of basic commodities including salt, rice, flour, sugar, margarine, maize meal, milk powder, infant formula, tea, soap, toothpaste and washing powder.

President of the Confederation of Zimbabwe Industries Kurai Matsheza said: “Around the whole world economies are looking within and protecting their industries right now. Here we are doing the opposite.”

He went on to say “if you look at the value chains that are involved, they are killing our economy”.

The Buy Zimbabwe lobby group said: “This development is likely to reverse the industrialisation gains that had been made by local industry in the supply of basic commodities.”

I’m not an economist, just an ordinary citizen, and all this is as clear as the mist swirling out there.

All I know is that people without access to US dollars are in dire trouble. On Friday night (May 20) the news came of new wages just set by government.

Read this and weep …

Child minder or disabled/aged minder Z$11 025 per month (that’s US$26.20 a month at the going rate today) or Z$55.68 per hour (that’s 13 US cents an hour at the going rate today).

Thirteen US cents an hour to care for a child, disabled person or elderly parent … what kind of inhumanity is this?

Shame on Zimbabwe.

Copyright © Cathy Buckle

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COMMENTS   7

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And in the next election they all vote for ZANU PF again.

In the biography of PK v d Bijl by Hannes Wessels (you would enjoy this book Cathy) he descibes the scene at the celebrations in Harare when Mugabe took over from the much maligned white regime.

Samora Machel was there and took the occasion to tell the honourable Mugabe: “You have won the breadbasket of Africa. Do whatever you want ….. but don’t get rid of your whites”.

And the rest is history. And I see the same playbook is on the table in South Africa. On Sundays in church I see only grey heads like my own. A couple of kids …. the middle generation is gone. They are overseas. And they are not coming back I don’t think.

As Yogi Berra said: it’s de ja vu all over again.

Groundhog Days!

I find myself wondering why I even give this subject any attention any more!!!

Truth is, it is not in their culture to govern, Rule(with fear, intimidation, and force) perhaps, but govern , no!!

More’s the fool I am, for thinking, wishing, and hoping it will be any different!

in my experience of world travel over the last 45 years, the three poorest places in southern Africa are the central highlands of Angola (two years ago), the Gaza province in Mocambique (18 months ago) and the Barotsi kingdom in Zambia (two weeks ago).

All three have one common denominator: the whites have left. And I don’t mean this to insult people or sound condescending. I simply state a fact from my personal observations.

A little ja/nee on this. I don’t think it is directly related to whites, that is a by product (plenty whites have done really well out of crooked Africa; Zim included).

The over riding factor, like in SA, is corruption and incompetence of every sort in just about every state touched field. In short; Africa, good (if misguided) people, the rottenest of leaders, amoral, greedy, venal and cruel. SA included.

The greatest mistake made by the African culture, an error for which they are severely punished, is their mistaken belief that Colonialism equals Capitalism.

They abandon capitalism, to embrace collectivism, as a part of their struggle for “freedom”. They merely exchange one form of enslavement for another. They voluntarily enslave themselves to poverty under a dictatorship as part of the process of emancipation from capitalism. They oppose capitalism, while capitalism is the only mechanism that guarantees personal liberty, human rights, and freedom.

Collectivism enables the most unscrupulous members of African societies to exploit fellow citizens and plunder national resources. That is why the political elite in Africa are always collectivist.

Ja Sensei — Democracy cannot function in any country where the population is marginally literate and scores average 65 on IQ.

Until this (or any) government prioritises Education and Birth control, this country does not stand a chance in the long term. Sadly the ANC doesn’t care what happens to its people…it is only interested in keeping power to rob tax and ratepayers. The EFF are trying their damndest to get on the gravy train before funding runs out and the DA are too busy defending the rights of all South Africans to pay attention to the realities of the situation.That’s the bottom line in my opinion.

End of comments.

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