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Tinashe Profile picture
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17 Nov, 7 tweets, 2 min read
(i) IMF release its report on Zim
(ii) RBZ move the Fx rate to 105
(iii) Backlog to be cleared

What to make of these.

The IMF article IV consultations are routine chats with it’s member countries. Unfortunately Zim is no longer on SMP & though the IMF & MOF had indicated…
..the resumption of SMP this year, the current report makes no mention. Meaning it’s not in the near future. SMP involves IMF deep dive & interrogation of the state of affairs. In contrast with this report based on feedback from stakeholders. It’s thin on details.
Eg it speaks of unsustainable debt & external arrears without any details. Zim is in a debt trap. With external debt upwards of US$20bn. The RBZ alone has a US$5bn debt problem.

The IMF let the cat out of the bag by highlighting how the RBZ is in control of the Fx rate despite
RBZ claiming it has a Dutch Auction. This manipulation of the rate saw it move from 85 to 105 in two weeks. Nothing positive about this except to lay bare manipulation by RBZ. Export viability is under threat. Hence the need to respond otherwise exports will dry.
RBZ claims GOZ will clear the backlog. Again the backlog isn’t meant to be there in the first place. GOZ involvement in the backlog perhaps reveals why the backlog was there in the first place. The level of manipulation in monetary affairs is astounding. RBZ & GOZ
Intervene greatly to the detriment of proper markets. After all the arrests the parallel market remains stubbornly northwards of 180. Its RBZ rate that’s had to move.

In a nutshell the incoherent IMF report stems from the authorities nonchalance on economic matters
and devastating dishonesty about its level of intervention in the markets & its policies. Zimbabwe at the moment is ruled by iron fist and clamp downs.

That’s not reflective of an economy growing at 7.8%. Not one bit

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More from @baba_nyenyedzi

Tinashe Profile picture
19 Nov
So what went wrong? What can we learn?

A thread 🔥🔥🔥

1/22 Reflecting on Nov 2017 coup
2/22
The coup was a reaction to the succession question left too late by Mugabe. By 2017 Mugabe had systematically wilted & weeded out many formidable individuals out of politics. By 2017, the choice for leadership was scant & relied on brawn than intellect.
3/22
Therefore whomsoever took over was certainly not the best & lacked the leadership mantle & skill. To have survived up to 2017 required utter, non conditional subserviency. That’s why Grace took a prominent position in succession. Her loyalty was deemed unquestionable.
Read 23 tweets
Tinashe Profile picture
15 Nov
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.
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
(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.
Read 5 tweets
Tinashe Profile picture
29 Oct
1/12
I am going to say something positive about the MPC. Hold on tight.

It’s really one aspect. The rest was the usual jaba jaba.

The MPC increased RBZ interest rates from 40 to 60% pa. Giving a real positive interest rate. Albeit with a suspect inflation rate.
2/12
This is what the RBZ remit is all about. This is the major lever the central bank has. Yet it has been absent and useless for the last six years. The day Mangudya decided on Zim dollars the next thing he should have done is positive interest rates. That’s the only way
3/12
A central bank defends its currency & maintains monetary integrity of the whole system. By doing so it would rein in GOZ profligacy & mal investments in the market. Sakunda would never have happened.

So it was dereliction of duty by RBZ as prescribed by the constitution
Read 12 tweets
Tinashe Profile picture
19 Oct
The way I was attacked, my IQ questioned, vitriol & trolling for simply stating the obvious that Zim is NOT an agriculture based economy! That over the decade, even with the best harvest Agric was now 9% ( 10 yr avg)of GDP.

In 2020 it was worse. It was 7.6%. Lowest in a decade.
Yet, unprecedented in the world is the amount of GOZ expenditure directed to agriculture.

We can explain it thus; despite an unprecedented expenditure in Agric through Command Agriculture, the sector contribution fell to its lowest.
The actual numbers point to a very fragile economy which was devastated by Covid.

Try & use the official exchange rates to determine the USD GDP.

Fx auction has reduced GDP overall gains. In the past Zim has enjoyed commodity booms, this time it was muted.

Thread in November
Read 6 tweets
Tinashe Profile picture
17 Oct
Most problems can be solved if only we engage. Twitter makes it possible to engage regardless of our views. But, through engagement & interrogation we often find the truth & logic to questions that trouble us. The worst is acting on something in ignorance.
Twitter allows the ignorance to find light. I am always amazed at the level of intelligence, engagement & examples. Oft times, I too am educated or find great nuances in our debates.

GOZ is made of ignorant politicians with power. Nothing wrong with ignorance, it can be changed
But ignorance with power will never allow debate. Leadership capacity means ability to deal with complexity. Complexity requires a lot of engagement & understanding.

One is required to be a pilot to fly a plane. But one is not required to be a pilot to run a successful airline
Read 6 tweets
Tinashe Profile picture
9 Oct
From a corporate governance perspective the Perm Sec Guvamatanga should refuse the gift from Tagwirei. From a public finance perspective, it spells disaster when the main beneficiary of the condonation bill (parliament pardon for over expenditure) is gifting country's treasurer
From a moral perspective, it reeks & stinks to high heavens when street traders are arrested for illegal currency trades when Sakunda and others at the party are beneficiaries of the ZWL in the market causing rates to spike.
Lets not attack the man. But the Perm Sec must understand that his friendship & expensive gifting with Tagwirei goes against ALL governance rules especially in public service.
Read 4 tweets

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