1/

I am of the strong view that the private sector should lead the vaccination program.

The insurance & pension industry must lead the private sector initiative. The NGO’s & aid agencies must support the private sector initiative- for free inoculation of the most vulnerable.
2/

Relying on a clueless GOZ will not solve the problem. But will perpetuate the endless lockdowns. Zim is already a laggard in the purchase of a vaccine. Israel made the order in April 2020. As of now, no order has been made by GOZ. Zero proof has been given
3/
Zimbabweans don’t realize how bankrupt the state is. And if the state was honest then the public would have been more sympathetic to Mthuli. Mthuli sees an opportunity to further fund raise. AIDS, rural electrification, Zinara levies go to central treasury & not intended uses
3/
The RBZ can no longer borrow offshore. Otherwise, if it was responsible, the purchase would have been made mid last year.

There has never been a surplus. No country under an economic depression has a surplus. And Mthuli’s political miscalculation has opened himself ...
4/
To ridicule. What surplus, that can’t be used to pay US$100m and save Zimbabwean lives🤷🏻‍♀️

The important lesson is to be honest.

GOZ can still play a role. Reduce prescribed asset status to 0%. Reduction in VAT, & remittance transaction tax to 0%. Reduce mining royalties ..
5/
Suspend the 5% gold royalty & the 2% transaction tax.

A closed economy means reduced tax revenues anyway. We need the economy open in the shortest period.

The biggest risk is another mutation of covid before the first jabs arrive. Our winter is just 3 months away.
6/
Zimbabwe has been shut out of the world. The WB & IMF have been supporting developing countries with budgetary support & covid related spend. Aid to Zim has dwindled & where it exists, Zim is at the back of a long queue.

The country is precariously vulnerable.

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More from @baba_nyenyedzi

6 Feb
1/
Not many countries in the world have a budget surplus. Not even fake surpluses. Well run countries found themselves in manageable deficits - without need to print. Borrowing directly from the market place.

Luxembourg is such an example- in normal years it runs a surplus. Image
2/
Mthuli made a mistake touting a surplus when it really wasn’t necessary to propagandize. The economy was already in a depression with the 2nd highest inflation in the world. GOZ domestic debt was being inflated away. Offering pensioners 8% interest when inflation was over 500%
3/
Perhaps his colleagues didn’t understand. They were happy to be told GOZ domestic debt was falling fast. Remember this was at a time the official ZWL inflation was banned.

The false euphoria resulted in 2 mistakes;
(I) Pension industry crushed to only $1bn.
Read 6 tweets
1 Feb
The diamond/water paradox goes as such. Diamonds are of no use to human beings yet valuable because they’re scarce. A carat is 1/5th of a gram & can fetch up to $20k. While water which is life saving, which humans cannot do without is free to $1 per 0.5l. Because it’s not scarce
Therefore value is determined by scarcity. A painting can fetch up to $400m, yet no matter how much a farmer produce can save starving kids, maize will fetch $200 per ha.

This explains why an Actuary is better paid than a Doctor. An entrepreneur better rewarded than a manager.
As an anecdote, Aristotle failed to solve this problem. So many are in good company. Yet Hesiod a contemporary of Homer figured it out by just observing the price of produce during the seasons. He identified the scarcity problem.
Read 6 tweets
20 Jan
Thread
Wishing Biden well

1/
Back in 2017, today. People protested against President Trump. It continued throughout the weekend. Their message was simple enough. It even had a hashtag. “He is not my president”.
2/

Suppose others too were to protest today with the same hashtag #HeIsNotMyPresident. How will the media & world react? This is not a call of violence of any kind. But peaceful protest as were witnessed four years ago.
3/
For a president that was predicted to be kicked out of office before his term was done, President Trump did well. More than well infact. History will record his many wins.

Reducing the tax rate from 36% to 21%.USA oil independent. Peace in the Middle East. No new war started
Read 14 tweets
18 Jan
Tourism is a forgotten sector in Zimbabwe. Treated as a step child. Despite its forgotten status it contributed 6% to GDP.

This is the same as Mining, but requires far less capital.

In good years Tourism contributes 10% to GDP. 2% more than agriculture.
Zim tourism is almost exclusively driven by domestic clients & diaspora. Very little is being done to attract international visitors who tend to spend more.

This is a snapshot of room occupancy. The number of rooms has remained stagnant for ten years since 2011. Image
The policy problem in my view is moral hazard. In cabinet & civil service you have full time farmers who go out of their way to direct attention & spending towards Agric. Mining is rot with corruption hence its visibility.

A study funded by USAID identified the policy problem Image
Read 5 tweets
13 Jan
Thread

1/
The value of Information in Economics

A most egregious & patently false allegation was made by Zanu PF as it pertains to Old Mutual Implied Rate ( OMIR). Old Mutual was accused by Zanu PF of fueling the parallel market.

Zanu PF got its wish & OM was suspended.
2/
At the time Nick Mangwana GOZ perm sec of information called OM and other dual listed firms “ fake counters”.

Chinamasa speaking on behalf of Zanu PF said “ZSE should compulsorily de-list”.

In other words. Fake counters must be compulsorily delisted.

Duly ZSE delisted OM
3/
George Charamba the President’s spokesperson & former advisor to the President Chris Mutsvangwa were even more rabid. Chris alleged the OMIR & Ecocash were staging a “ coup”.

For Charamba it was an “illicit”, “outlaw” activity becoming a security threat for the state.
Read 22 tweets
9 Jan
1/
This is a good piece in trying to uncover a dubious & scandalous transaction. But more could have been investigated and cross checked. Eg ZMDC mines only Jena is producing and it’s less than 50kgs a month & not 300kgs as the article alleges.
2/
Secondly it claims the issue of sanctions against Kuda Tagwireyi is perhaps the reason why this hocus pocus is happening. This is not true & I will explain later.
3/
Thirdly like many news items it too fails to verify information that is parroted by management & others. Eg the deal amounts & said capital raises of $1bn. This is all a ruse. Caledonia that produces 60k ounces of gold is valued at US$200m, has millions of ounces in reserves
Read 14 tweets

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