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Mnangagwa told to fix politics to save economy

19 Jun 2020 at 17:19hrs | Views
BOTH political and economic experts have implored President Emmerson Mnangagwa and Zanu-PF to move with urgency to resolve Zimbabwe's long running political crisis if the deepening local economic rot is to be overcome, the Daily News reports.

This comes after the government awarded its workers and pensioners US dollar allowances on Wednesday, amid growing restlessness among long-suffering Zimbabweans as a result of the country's worsening economic crisis.

In addition to effecting partial dollarisation, authorities also awarded all civil servants a salary increment in the local currency of 50 percent, which economists said would further fuel inflation and also lead to more price hikes of basic goods.

Experts who spoke to the Daily News yesterday said a viable solution for the country's economic crisis needed to be underpinned by a resolution of Zimbabwe's political turmoil - probably including the formation of another Government of National Unity (GNU) as had happened a decade ago.

The calls for a second GNU also come as the Church has resuscitated its push for dialogue between Mnangagwa and Nelson Chamisa - amid hopes that this week's gathering of the country's top clerics at the National Day of Prayer in Harare will further assist the efforts to persuade the two men to end their long-running political feud.

"As I have said many times before, the country's solution lies in politics. The rift between the ruling party and the opposition is doing more harm than good.

"What is needed is for them to come together and find a common solution to our problems.

"This will solve the social and economic crises we are facing because everything is linked to political actions," University of Zimbabwe political science lecturer, Eldred Masunungure, told the Daily News.

"Having a GNU is not something new. It has been tried and tested before. We did this in 2009 and it worked.

"Prices stabilised then and the inflation rate dropped significantly. So, let us adopt this same solution and put to an end our diplomatic, social and economic woes," he added.

Masunungure also said the awarding of US dollar allowances to civil servants and pensioners was more of a "knee-jerk reaction than a plan" to mitigate the current economic crisis.

"It had become common knowledge that what we have been witnessing in the past few days was now beyond the enforcement of the national lockdown.

"Security forces were angry because their salaries had been cut in an economic environment which actually requires the opposite.

"Things were thus getting to a boiling point and the government, in reaction, decided to lift the lid before the contents of the pot spilled over," Masunungure further told the Daily News.

"Unless the government also fully embraces the US dollar, then we are going to see a repeat of this until a certain point where things just boil over because people would have had enough," he added.

Top economist Tony Hawkins concurred with Masunungure saying authorities needed to "deal decisively with all the country's worsening crises".

"This (US dollar allowances) is just a temporary measure from the government, which was trying to appease the civil service - particularly the security forces which were showing signs of being very unhappy.

"It indicates that the government is clutching at straws and is desperate. They have run out of solutions.

"Unfortunately, this solution is not sustainable because even the 50 percent increase is meaningless due to the Zimbabwe dollar having lost value and continues to do so," Hawkins told the Daily News.

"Unless the government is planning to find a permanent solution to this problem, such as re-dollarising the economy, then in a few months' or weeks' time we are going to be facing disgruntlement in the country again.

"The alleged arrangement in terms of the payment of the coronavirus (Covid-19) allowance will be done electronically.

"What this means is that thousands of civil service workers will now have to open accounts and get bank cards.

"This just doesn't make sense because why would the government go through the trouble of requiring civil servants to open accounts which will be used for just three months. Why go through all this trouble? Hawkins further told the Daily News.

"Having a GNU based on dialogue and mutual decisions to cleanse all the elements burdening the country, such as human rights violations and reforms and corruption, will help us find a sustainable solution to the country's crisis," he added.

On his part, the secretary-general of the Zimbabwe Congress of Trade Unions (ZCTU), Japhet Moyo, also said having a political settlement between Mnangagwa and the opposition would be the panacea to Zimbabwe's myriad crises.

"The issue of political reforms is a hot potato that no one is willing to truly resolve.

"However, it is a necessary solution to the country's problems and we might not agree in terms of the kind of government of national unity we would want in place, but it has become clear that this is the only way to go," Moyo told the Daily News.

He added that the government should also revert back to the multi-currency system, as was the case in 2009 when the Zimbabwe dollar was decimated by hyper-inflation.

All this comes as the country's economy is rapidly approaching the horrors of a decade ago when the Zimbabwe dollar was decimated by hyper-inflation - with the prices of most basic consumer goods now out of the reach of ordinary citizens.

Wednesday's decision by the government to pay its workers and pensioners allowances in US dollars had similarities with how the then administration of the late former president Robert Mugabe introduced the stability-inducing multi-currency system in 2009.

Then, Zimbabwe binned its worthless currency and introduced the multi-currency system which was anchored by the US dollar.

Despite this system having served the country well for more than a decade, Finance minister Mthuli Ncube rattled the markets in June last year when he prematurely and ill-advisedly ended the local use of the US dollar and other foreign currencies.

He directed at the time that the Zim dollar be the sole legal tender in the country, without addressing the root causes of its crash and subsequent decimation by hyper-inflation in the run-up to the consummation of the 2009 GNU.

However, and as the economy has continued to tank, more and more people are urging Mnangagwa and his Zanu-PF government to end their bickering with the opposition and form a GNU.

Mugabe was forced into forming a GNU with the MDC's much-loved founding father, Morgan Tsvangirai, after the hotly-disputed 2008 polls.

The short-lived GNU was credited with stabilising the country's economy which had imploded in the run-up to those elections.

In those polls, Tsvangirai beat Mugabe hands down. However, the results were withheld for six long weeks by stunned authorities - amid widespread allegations of ballot tampering and fraud, which were later revealed by former bigwigs of the ruling Zanu-PF.

In the ensuing sham presidential run-off, which authorities claimed was needed to determine the winner, Zanu-PF apparatchiks engaged in an orgy of violence in which hundreds of Tsvangirai's supporters were killed - forcing the former prime minister to withdraw from the discredited race altogether.

Mugabe went on to stand in an embarrassing and widely-condemned one-man race in which he declared himself the winner.

Source - dailynews
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