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‘Zim dollar now in real peril’ … back on the slippery slope again 

Scores of foreign currency traders arrested in recent weeks – but what is the alternative?
Anyone arrested on ‘currency manipulation’ charges will spend Christmas in prison, according to the country’s vice president. Image: Shutterstock

When it started raining at dusk and went on all night I knew I had a problem.

With a friend on the banks of a river in a mountainous area where the roads are all steep hills, sharp corners and red soil, I knew it was going to be a treacherous 17km-journey the following morning. Still raining at 7.30am we had to abandon one last walk along the banks of the beautiful crystal clear river and leave it rushing along the pebbles and gushing over the rocks.

The first 15km were bad: heart pounding, hands gripping the wheel and sideways driving we crept along, the red roads sticky, clingy and slick. Three or four bends from the end the wheels gave up, thick red mud in the tread and then another inch on top of that and a steep slippery slope ahead.

We were going nowhere without help, a tow rope and a powerful pull.

Being dragged up the hill was very appropriate for the state of Zimbabwe.

The country again finds itself driving sideways and backwards and on a slippery slope to nowhere.

On the cusp

Zimbabwe is on the cusp of another economic crisis. The last one was between 2005 and 2008 and in just 13 years our leaders are doing the same things all over again: shouting, blaming, arresting, accusing, threatening.

Foreign currency is in such short supply that the value of US dollars against the Zimbabwe Bond dollar is soaring. The government’s auction system where companies and businesses have to bid for US dollars to meet their costs and imports is a joke.

Successful bids for US dollars which are supposed to result in currency arriving in two days are now taking 15 weeks before funds are allocated by the Reserve Bank.

It’s all but impossible for importers and retailers to do business when they have to wait almost four months for the currency they need to keep operating.

In 2019 President Emmerson Mnangagwa ordered the return of the Zimbabwe dollar, saying it was “the strongest currency in the region”.

At that time one US dollar was the same value as one Zimbabwe dollar.

Two years later one US dollar is equivalent to 170 to 200 Zimbabwe dollars on the street (on the black market). Meanwhile, the government continues to insist that one US dollar is worth 88 Zimbabwe dollars.

Arrests

Over the past few weeks scores of foreign currency traders have been arrested. Government says it is weeding out ‘saboteurs’ and ‘fraudsters.’ Government is threatening to suspend operating licences of businesses it accuses of using black market rates to price their goods and services.

Vice President Constantine Chiwenga said the Zimbabwe dollar is being deliberately sabotaged and: “I wish to warn perpetrators of this heinous crime that the long arm of the law will soon catch up with them.”

Chiwenga said people being arrested on “currency manipulation” charges will spend Christmas in prison.

The CZI (Confederation of Zimbabwe Industries) said the Zimbabwe dollar “is now in real peril” and “clamping down on informal foreign exchange trading in the absence of a viable formal market will have catastrophic consequences for the economy”.

Meanwhile for ordinary Zimbabweans the nightmare is getting worse.

Food prices are increasing because retailers are charging more in order to keep up with the cost of buying US dollars to import goods to restock their shelves.

Tel One, the country’s telecommunications provider which is owned by the government, just increased its prices by 30%.

Fuel prices increased from US$1.25 a litre to US$1.35 last week.

And then, to make life harder, my home town is crippled by electricity power cuts which are lasting up to 14 hours at a time, three or four or five times a week. An enquiry to the local electricity supplier (Zesa) requesting the schedule of power cuts elicited the response that it isn’t following its own recently published load shedding schedule anymore, saying it just got instructions from HQ to load-shed – which it does.

Oh Zimbabwe, the slippery slope needs a different approach this time surely?

Copyright © Cathy Buckle

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“Oh Zimbabwe, the slippery slope needs a different approach this time surely?”

Unfortunately there is a disconnect in what is “needed” by the populace and what is “needed” by the bureaucracy. In Africa democracy is misused by the authorities to enrich themselves at the expense of the electorate. When democratic loss become a reality these authorities then simply forego all democratic principles (not that they had any to begin with) and use the security forces to maintain power and wealth, again at the expense of the populace.

Until there is a “French” revolution of sorts, Zimbabwe will unfortunately be stuck in this cycle of violent oppression. South Africa on the other hand is still at the oppression in the name of “democracy” stage, the current trend unfortunately mean we will in about a decade or two find out whether or not we will also transition to the violent oppression stage.

Local Zimbabweans are well known for being way more intelligent than local South Africans. So in a decade or two things might well be way worse than Zimbabwe.

That is actually true of most Zimbabweans that I know in Cape Town, but that is probably why the are in Cape Town not Zimbabwe.

The test will be whether intelligence will trump violence.

Which reminds me of South Africa. I am in a non violent man and I will never stay anywhere where violence is threatening. I am sure all people with even just a small amount of more than average intelligence feels the same. The brain drain continues, and I think the Frogs in the Pot that needs to be taxed is streaming out of that pot as it currently is close to boiling pot.

Of course these are the types of articles that give MW readers lasting “satisfactions”. “Zimbabwe has failed without the white people farming for it. Look at it! So ANC don’t try this at home and EFF is a a bunch of fools for suggesting it.”

For those blessed with “above cognitive ability” in the comments’ section surely you should know, that some point will come when it won’t matter what the actual reason will be – ANC, EFF or apartheid; poor SAns will just rise up like they did in July to take “their” resources and direct their anger at the easiest and most convenient demographic. What will they have to lose after all!

Surely your superior logic should teach you that the current status quo of wealth distribution along colonial structural remnants is unsustainable. Surely YOU are intelligent to see this.

It may be at the next election or in a decade but be assured – they will be poor enough not to care and they will come. As they did in Zim 20 years after trying to negotiate and “amending sections of the constitution”. The fallout, for the poor anyways, will just be collateral damage!

Always someone else’s fault eh. Maybe look at 27 years of looting, thieving and incompetence by the ruling ANC; just like ZANU PF. Whatever changes should have been made there have been 27 years to do it; but, like Zim, the ANC elected to steal the money and not put reforms in place, keeping Eskom, SAA and the many useless municipalities alive with thieving cadres.

As you point one finger, three point back at you.

Yes you are right they will rise up and destroy what is left after the government cadres has chased away those that generate wealth and stolen and eaten the rest.

As Kgalema Motlanthe said the ANC needs to first destroy itself before there will be insight.

The delivery of service and identification of opportunities will always be the most sustainable way to accumulate wealth. To now assume that another person is entitled to “distribute wealth” is proof that superior logic is missing

I see that you have had a record maize harvest and hopefully it will trickle down to the hungry. I note that Z$100 is today trading at 0.27 US Cents and R4.07c … Sigh …

But wait! Fortunately they have all the land, and that is all one needs to be a huge success.

Zimbabwe’s economy has struggled because of sanctions placed by the west.

It had nothing to do with their land reform laws. The transfer of land, has actually been very successful and many Zimbabwean’s have benefited.

Thank you for your considered view. ..now go crawl back under the rock u came from.

Ignore and report

“Communism has failed where ever it has been tried”
“No that wasn’t real communism”

And so the cycle repeats.

I understand where you come from. You will be stupid to sink your entire communist manifesto by confirming the obvious and logical truth. Therefore, you simply have to find another, illogical, unrealistic, and ideological lie to excuse the general failures of communism.

EFF supporters, like ZANU-PF supporters, haven’t been blessed with any modicum of cognitive ability and economic freedom depends on an above-average level of cognitive ability. You guys have basically been screwed both ways.

Now for the good news. The disastrous performance by the ANC can only benefit the EFF. When push comes to shove, the ANC will simply neuter the EFF by implementing the EFF manifesto and expropriate land. That implies you will be screwed 3 ways. You just can’t win, can you?

So succesfull they are now giving it back to the white farmers.

Returning land to the rightful owners that have most likely passed away due to age, trauma and murder.

The farmers and their families should be compensated for all their suffering in US dollars.

Ha ha ha.. You are a commie in a fairly free country. Go and try be free in real commie country… You should do a “Robert from Sydney”….

On a serious note gents what happened to “Robert from Sydney”?

The requirements for sanctions removal should be of foremost concern to the ruling Zim elite. Unfortunately they place themselves before the people and so the sanctions remain in place. A reparations deal was initiated but then it quietly failed. Clearly not the fault of the international community because any such failing would have hit the headlines. When the Zim leadership fails this is no longer news, it is to be expected. There has been plenty of time to offload the sanctions when it was still affordable. The price of intransigence is nothing less than everything.

You clearly lack the ability to join any of the dots. Quite embarrassing actually. Unless you are deliberately just trying to get a rise out of the readers on this site.

Do you have any clue what you have just stated?

Have you read any newspaper or watched the news in the last 20 years?

I’m happy that the average Zimbabwean and South African has the government they voted in. They have chosen the path of The Big Man …please enjoy

I don’t feel sorry for these people! They wanted liberation and got the land.

Got back and fight for your country and stop coming to SA for jobs! Fight as you fought Ian Smith and the “evil” regime.

Ahhhh, how easily I regress to the halcyon days of yore – oh, all right, 2008 – with Mail & Guardian posters screaming about “ZIMBABWE’S END GAME” from lamp poles…

“Zimbabwe is on the cusp of another economic crisis”…..ummm, when is the country not in a crisis?

How many times will they go through the same cycle?

It will be a constant loop, they will keep doing the same actionsand entertaining the same ideas, thus the results will be the same

the cycle is intentional because the cycle is profitable for those in power. They feign stability, sucker in some investors/businesses, then pull the rug via currency manipulation from the highest offices in the land. Rinse and repeat.

Maybe we should incorporate Zimboland into RSA and let the EFF run it to prove their economic and political prowess .Probably only they could stuff it up more than it already is !!

I can’t understand why Zimbabweans like being treated like this? Why don’t they just change the system?
It’s so easy.

Unless deep down they like it like this.

Uncle Bob was so anti-west, why did he chose the Zim Dollar?

Why not Zim Ruble (Rubbel) or Zim Yuan (JyKan)?

On a slippery slope again?? When has Zimbabwe ever been off the slippery slope or out of the deep hole it threw itself in years ago?

Its just more of the same, when I was last in Zimbabwe (around 20 years ago) all of this was already happening. Black market exchange rate vs “official” exchange rate.
Zim government still hasn’t accepted there’s no way to shore up a worthless currency no matter what you try.

End of comments.

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