1/6
Who made the RBZ a GOD to decide who gets what, when, & at a fixed price? Is this the system Zimbabweans want? Price controls and rations?
Firms no longer need to be innovative. They just need to borrow ZWL & apply for FX.
Fx is scarce. Is this the best way to spend it?
Who made the RBZ a GOD to decide who gets what, when, & at a fixed price? Is this the system Zimbabweans want? Price controls and rations?
Firms no longer need to be innovative. They just need to borrow ZWL & apply for FX.
Fx is scarce. Is this the best way to spend it?
2/6
Did anyone see the connection between the recipients of Fx & consumer basket? This is how inflation rate is rigged.
Gono tried this system. Inflation went down from 635% to 130%. But the pent up bubble burst & inflation skyrocketed beyond the 635%.
Did anyone see the connection between the recipients of Fx & consumer basket? This is how inflation rate is rigged.
Gono tried this system. Inflation went down from 635% to 130%. But the pent up bubble burst & inflation skyrocketed beyond the 635%.
3/6
What if Gono had maintained the market allocating Fx & not played God?
Almost all the beneficiaries of the current Auction system are consumption based. This is the height of misallocation of resources.
What if Gono had maintained the market allocating Fx & not played God?
Almost all the beneficiaries of the current Auction system are consumption based. This is the height of misallocation of resources.
4/6
Instead of using FX for capital investment & increasing the country’s production capacity. The most scarce resource is used to make “cheese”.
Imagine if miner retained all FX during this commodity boom? Their first call, would be to double capacity. That’s what miners do
Instead of using FX for capital investment & increasing the country’s production capacity. The most scarce resource is used to make “cheese”.
Imagine if miner retained all FX during this commodity boom? Their first call, would be to double capacity. That’s what miners do
5/6
...during a commodity boom. By increasing capacity they reduce the cost of extraction. Capital investment leads to
(i) Production (GDP) increase
(ii) Creation of good quality jobs
When was the last time a gold miner in Zim invested US$250m on a capital project? Never!
...during a commodity boom. By increasing capacity they reduce the cost of extraction. Capital investment leads to
(i) Production (GDP) increase
(ii) Creation of good quality jobs
When was the last time a gold miner in Zim invested US$250m on a capital project? Never!
6/6 Yet in the rest of Africa & other developing nations US$1bn investments are happening in Gold mining
In Zim, miners are subsidizing consumer consumption instead of capital investment.
At some point we must accept we don’t have thinkers in this country.
End
In Zim, miners are subsidizing consumer consumption instead of capital investment.
At some point we must accept we don’t have thinkers in this country.
End
NB**
“The parallel market premium which had narrowed markedly in the first quarter of 2004, widen sharply from 45% in Jan 2005 to about 100% by early July 2005.” IMF report.
Since the Fx Auction of June 2020 the parallel market premium is already above 45%.
Was Gono better?
“The parallel market premium which had narrowed markedly in the first quarter of 2004, widen sharply from 45% in Jan 2005 to about 100% by early July 2005.” IMF report.
Since the Fx Auction of June 2020 the parallel market premium is already above 45%.
Was Gono better?
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