Zim economy
The current state of the Zimbabwean economy is no secret. From an almost inexplicable 1:1 bond note to USD exchange rate to 200:1 +, this is just one of the tell tale signs of an unstable economy. A couple of moves have been made by the government and looking back, its now adding up.
Now you are probably thinking of all those times Zimbabwe’s economy analysts and other reputable sources stated that Zimbabwean was headed towards greener pastures. Eddie Cross issued a statement going in depth on how the economy of Zimbabwe was positioned in a way that it was finally set for stability. The International Monetary Fund (IMF) seemed to back up those statements stating that Zimbabwe’s economy was set to grow more than they had previously reported. All this was said just last year.
On the contrary, other reputable media sources (Bloomberg among others) shared detailed articles of the Zimbabwean economy stating that it was on the verge of collapsing.
So what’s the real deal?
Well, lets take a look on the ground.
Some of the steps taken by government to date
The government has announced various measures from the time the statements on the economy being headed in the right direction were made to date. Now, looking carefully at how far we have come, the economy seems further from the “stability” that has been spoken about.
Here are some of the events that have taken place thus far that we will soon dissect to get a clear position on where we are as a country.
- Mthuli Ncube announces 50% duty on car imports is payable in Zim dollars.
- Announcement of $50 withdrawal at bank rate for Zimbabweans
- $50 withdrawal for general public halted
Other policy changes were stated in the 2022 Monetary Policy.
Complete 2022 Monetary Policy – DOWNLOAD HERE
A sign of a crumbling economy?
The aforementioned are just but a few measures taken by the government between 2021 and 2022. However, why did retractions or alterations have to be made on previously established policies? While changes are allowed, in our case this could be the tell tale sign of a plummeting economy.
Why?
For starters, before the announcement on duties on car import being payable in Zim dollars consider the prevailing situation. ZIMRA was experiences a huge decline in revenue coming in from vehicle imports due to high duty fees. So…no/not as much money as before. A change had to be made, right? If at least half the duty fees is payable in Zim dollar that seems incentive enough for more car imports to take place and more (seemingly much needed) money flows in.
How about the $50 withdrawal at bank rate which has now been reserved for pensioners, senior citizens and vulnerable members of society? Is it possible that in addition to the government trying to limit the people profiting from the arrangement, there also just could be less money available to continue providing the $50 withdrawal limit to the public? Could that be the same reasoning that might have lead to the further limits on mobile money transactions?
The Zim dollar continues to deplete against the USD. However, reports from local based media continue to point to a growing Zimbabwean economy so we might not get to the point where our currency is exhibited in British museums again, right?