The Bond Coins in Zimbabwe

The RBZ governor Dr John Mangudya recently introduced to the multi-currency Zimbabwean economy the bond coins. These were meant to help Zimbabweans on transaction issues. The bond coins were however met with some sot of resistance among Zimbabweans .This blog tries to discuss why there was this resistance among the Zimbabweans.

bond coins in a plastic paper

The first resistance came from the media itself .The private media criticized the bond coins and led in some arguments against these bond coins . It has been a culture of the private media to criticize the government for any policy or move it makes even when they are positive.

The Zimbabwean bearers cheques

The second fear was that the government was going to produce the Zimbabwean dollar once again . People took the introduction of bond coins as strategy of bringing the Zim dollar. People lost trust of the Zimdollar after the 2008 inflation. Mangudya has however denied on allegations of bringing back the Zimbabwean dollar.

It is however that the bond coins came to help on transactions therefore Zimbabweans must understand and accept the bond coins

 

Investor Friendly Policies in Zimbabwe

Zimbabwe's economic policies have been criticized  of not being user friendly. They have been criticized of scaring away investors. This is one of the reasons given to the poor growth of the economy as well as the high unemployment in the country. 

An Industrial Site in Zimbabwe

An Industry in Zimbabwe

In Zimbabwe's economic policies, there is a policy that states that a foreign investor shall only get 49% of the profit whilst 51% stays in Zimbabwe.The policy is now widely known as the 49/51 indigenisation policy.The policy truly scares away investors as part of the investor's profit is taken away leaving the investor with a only 49% of the profit . It is hard for an investor after getting all the equipment and inducing a lot of money to let 51% to be taken away. 

The ruling government has defended itself on implementing the 49/51 indigenisation policy stating that the  "law is  not responsible  for the lack of Foreign Direct Investment (FDI) in the country". This is hard to believe given the fact that since the establishment of the law the country has seen a lot of companies closing. 

Zimbabwe is not the first country to implement the 49/51 policy.This does not mean that it is moving the right way on the indigenisation policy. One should consider the time and also the situation in which the policy is being implemented. Zimbabwe is deeply in search of investors therefore its policies should attract investors. There is competition of investors around the world with investors' eyes on the southern neighbor ,South Africa .

 Given such a situation the the country should revise the policy to fit the competition. The policy fits for the developed countries where there will be need to limit the number of foreign investors in the country. 

Sowing Disaster Creating Tears For The Next Generation

The future of Zimbabwe economical remains bleak. Its growth of the year is not in a good direction . The unemployment  levels in the country remain a threat .Students from the universities can feel the heat of unemployment. What will be Zimbabwe in the next generation then given all this?

The future of Zimbabwe is in the leaders of the country. One scholar once said everything rises and falls on leadership. Our policies seem to look at Zimbabwe today and forgets tomorrow . This is in relation to the fact that there is high deforestation in the country.The country is also exporting baby elephants  to other countries especially to its "all times weather friend" China. No one knows how or when is Zimbabwe going to pay its $10 billion debt. The  Chiadzwa diamonds in Marange have not benefited much to the country.Its operations have seen the company indebted to many of its workers.

Mbada diamonds workers

Mbada diamonds site

Given this scenario one can say that the policies in Zimbabwe are  not doing enough to help the next generation. There is a great danger that the performance of the country today shall influence the next generation of the country. The wealth of the country that is going to countries may not come back leaving the next generation in calamities.

China , Fruits Not Yet Ripe

Chinese Flag

The Zimbabwean President visited China last year . This visit was aimed at increasing the number of investors in the country.This journey is still yet to yield fruits for the Zimbabwean economy. What is delaying the outcomes of the journey.

Zimbabwean Flag

Due to the Look East Policy that was carried out in Zimbabwe, the Zimbabwe-China friendship was strengthened. Zimbabwe has called China an all weather friend . This implies that China supports Zimbabwe even in bad situations. China will support the country even in implementing policies that are detrimental to the country (Zimbabwe).

It is very important for the major deals in China to start bearing fruits as there is a crisis this year. Zimbabwe is facing hunger this year  after a farming season of disappointing  rain patterns in the country. The major deals are supposed to help implement the ZimAsset . The slow implementation of the mega deals from China only implies that China is not yet ready to support the Zimasset or also that it has some queries with the policy

 

 

Consultation Before Policy Implementation in Zimbabwe.

The Zimbabwean Flag

Chinamasa

 The Zimbabwean economy has been deteriorating despite the introduction of the ZimAsset economic blue print. A lot of people have lost their jobs  in the country and strikes have already been reported in universities as the country struggles to pay its workers. Everyone has accepted that the country's economy is on the bleak. In my own opinion the problem of the Zimbabwean economy lays on its policies.Ordinary Zimbabweans have not participated on the construction of the ZimAsset policy .

 It seem to me that the participation of ordinary people in policy making is still small on ordinary Zimbabweans. The people are not even given a platform to debate about the policies of their own country . Policies are being dictated on ordinary people giving a limited feed back to the government. Those that support the ruling party are then used by the state to sell the policies to the people even if they are disastrous to the country . Satirically some of the people who are used to sell the policies do not understand the policies they are selling resulting in confusion amongst the citizens of the country.

Consultation is very useful as it brings new ideas from the people. Zimbabweans are a learned people and if they are consulted they can bring with them good ideas to move a nation .Before the reduction of bread in Zimbabwe, there was a consultation between the stake holders in the baking industries coming up with conditions that were favorable to everyone. This should have been done to the manufacturing industry before the implementation of the ZimAsset blue print .

Zimbabwe a begging economic country

Zimbabwe is a country that has a huge dept that is estimated to be more than US $5 billion . This dept is yet to be paid. Despite this dept, the the country has been rumored to be looking for another dept in China. Most of the people are stressed about what would happen to the next generation with the country with such a huge dept.

The public dept in Zimbabwe was at at around US$7 million in 2013.With such a huge dept Zimbabwe is not allowed to borrow another amount with the World Bank .

The best way for Zimbabwe to move on is to find new ways of paying the dept as soon as possible before it destroys the future of the country. We have to learn from others and also have good competitive policies that do not scare investors to the country.

According to the 2015 budget by Honorable Chinamasa Zimbabwe is going to focus on the ZimAsset blue print which is still confusing a lot of investors even ordinary Zimbabweans do not know what it says.

Chinamasa in parliament

CHINAMASA WITH THE BUDGET

Zimbabwe: Debt evolution

YEAR	Millions $	% GDP	$ Per Capita
2013	7,285 $	55.16%	526 $
2012	7,072 $	56.73%	516 $
2011	5,673 $	51.76%	425 $
2010	5,964 $	63.19%	456 $
2009	5,579 $	68.29%	432 $
2008	4,093 $	69.43%	338 $
2007	3,477 $	50.53%	289 $
2006	3,211 $	45.08%	267 $
2005	2,987 $	38.83%	253

200720072008200820092009201020102011201120122012201320133,0003,0004,0004,0005,0005,000Debt Millions €Debt Millions €

Date	Debt Millions €
2005	2,401€
2006	2,557€
2007	2,537€
2008	2,783€
2009	4,000€
2010	4,498€
2011	4,076€
2012	5,504€
2013	5,485€

200720072008200820092009201020102011201120122012201320133,0003,0004,0004,0005,0005,000Debt Millions €Debt Millions €

Date	Debt Millions €
2005	2,401€
2006	2,557€
2007	2,537€
2008	2,783€
2009	4,000€
2010	4,498€
2011	4,076€
2012	5,504€
2013	5,485€

The Land Reform Program

The Zimbabwe's land reform program has seen a lot of white farmers loose their land .This policy is viewed by the "public media "as a good policy that corrected the unjust distribution of land that was there during the colonial period.The has policy has however been another story in the "private media". The private media decided to rather call it the land grabbing rather than the land reform . The question is then that what benefits did the land reform give to the black people? In other words was the land reform a benefit to ordinary Zimbabweans? This blog is influenced by the articles where the Zimbabwean President "threatens to take land from the remaining white farmers".

A white family during the land reform program

Black people threaten white people to leave a farm 

After the land reform program Zimbabwe  became a country that lacked food security. The black people that took the land from the productive white farmers could not produce as much farm products as the white farmers did . This has been because the black farmers had no experience of the modern farming methods that were being used by the farmers. The dairy cattle were now being used for the African traditional farming. Land meant for grazing was now being used for ploughing and deforestation increased in these former white owned land.

The other reason for the failure of the utilization of land by  the black farmers was that some of the white farmers had to sabotage the farming equipment or the farming land . This was because they felt the bitterness of the land they called theirs being taken away.

There are two ways to move on in Zimbabwe after the land reform program. The first thing to do is to educate the black farmers that managed to get land from the land reform program. The second thing to do is for the government to let the former farmers help the black farmers utilize the land since some of the white farmers are ready to help

The President of Zimbabwe is however not ready to accept any agreement about the land .http://www.telegraph.co.uk/active/11442408/Zimbabwes-white-farmers-targeted-for-new-Mugabe-land-grabs.html .

United Nations Backing of the Zimasset

The United Nations Flag

The Zimbabwean Flag

The United Nations (UN) has recently pledged to back the Zimbabwe's policy, Zimbabwe Agenda for Sustainable Socio-Economic Transformation(ZimASSET). According to the NewsDay, a Zimbabwean privately owned newspaper, the UN promised give Zimbabwe over $400 million before the end of this year. 

view herehttps://www.newsday.co.zw/2013/11/27/un-provide-430m-zimbabwe-projects/

The United Nations Building in New York USA

This is a good support and shows that the ZimASSET is a good and acceptable policy.The question that however comes out from this development is on the applicability of the policy. Given the situation in Zimbabwe where there are a lot of reports on corruption issues and mismanagement of resources, it becomes impossible for one to believe that the money given to Zimbabwe by the UN is going to be used properly for the implementation of the ZimASSET policy. A lot of money is being funded into the country through organisations such as the Africa Development Bank (AfDB) and the World Bank (WB) but no one has ever looked into the use of the money . This gives room for mismanagement of the money. 

Some have argued that the ZimASSET is a selling point for the government . This argument states that the ZimASSET policy was formed by the government as a way of looking for funds

President Mugabe at UN video

During a speech at the UN the Zimbabwean President President Robert Mugabe spoke about the policy.Some of the online publications reported him as selling

view herehttp://www.zimeye.com/video-mugabe-sells-zimasset-to-united-nations/

President Robert Mugab

President Robert Mugab

   

Is this the abandoning of the Look East Policy

It seems that there is now a turn around on the Zimbabwean Look East Policy .The current Vice President of Zimbabwe  Emmerson Dambudzo Mnangagwa has been quoted by a Zimbabwean local newspaper  The NewsDay implying that Zimbabwe cannot do without the West.

View Article Here https://www.newsday.co.zw/2015/02/27/cant-without-west-mnangagwa/

This is a shock for those who know the policies and the way in which the Zimbabwean ruling party does its things . There are two probable explanations of the article from this shocking remarks that were uttered during  the commissioning of a $9,10 million Africa Development Bank (AfDB) in Mutare on the 27th of February 2015.

The First explanation is the one that has been given by the NewsDay reporter Kenneth Nyangani who describes it as a U-turn . The government could have seen the dangers of its policies such as the Look East Policy  . The Look East policy had a tendency of forgetting deals with the West whilst at the same time making business with the East countries which are mostly the Developing countries which are also relying on trade with the West for economic growth. The government now sees the dangers of this policy and want to reverse it so as to attract the once perceived enemies from the West. The government also wants to attract more donations from the International Community which are the Western countries. These Western countries control the donors of Zimbabwe such as the AfDB hence the government wants to amend these relationships to get more funds.

The second explanation to the article is that the government itself is divided over the issue of coming back to the West. The Zimbabwean President is yet to comment on the normalizing of relations with the West. His words have been that Zimbabwe has nothing to do with the West.The President has also said that the country must maintain its relations with the East since the Western countries are not "our friends". This shows that there is a contradiction between the President and his recent elected Vice President over the relations with the Western countries