People remember the 14 November 1997 zim dollar crash. And attribute it to war vet payments. This is patently false. Correlation does not mean causation.
While war vet payments may have been the straw that broke the camel’s back it’s not the real reason.
While war vet payments may have been the straw that broke the camel’s back it’s not the real reason.
The real reason is RBZ quasi fiscal activities that started in 1990. The mismanagement of the economy in the 1980’s despite huge donor funds spilled over in 1990’s.
RBZ printing filled the gap left by donors & MFI’s.
(i) Maize subsidy of 56% for consumers & 100% for vulnerable
RBZ printing filled the gap left by donors & MFI’s.
(i) Maize subsidy of 56% for consumers & 100% for vulnerable
(ii) RBZ printing directly funding farmers input schemes.
Africa went through exactly the same problems Zim had. But didn’t use their central banks in direct financing of subsidies, fiscal activities & political payments.
Africa went through exactly the same problems Zim had. But didn’t use their central banks in direct financing of subsidies, fiscal activities & political payments.
(iii) When RG Mugabe on a whim decided on the war vet payment it was because he now knew he could just print money. After all they had been printing for seven years without major consequences.
He didn’t realize that privatization had helped greatly to mitigate the costs of…
He didn’t realize that privatization had helped greatly to mitigate the costs of…
Printing that had been going on. Elections had been won by the printing press as well. So there was no need to consult anyone. Any problem, printing was the cure including war vet political challenge.
To be clear. After 7 yrs of RBZ printing Nov 14th was inevitable.
To be clear. After 7 yrs of RBZ printing Nov 14th was inevitable.
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