Opposition parties have called for an independent institution to oversee Zimbabwe’s monetary policy implementation and strictly regulate the market while promoting financial literacy among citizens.
This suggestion comes after Zimbabweans expressed scepticism about the new Zimbabwe Gold (ZiG) currency, saying they have gone down this road before, where monetary policy discrepancies and looting risks have made them lose faith in the local currency
The new currency, debuted on the market with a strong exchange rate against the US dollar, particularly in the region, but opposition parties have derided this as a farce, noting the RTGS was once billed as the strongest currency in SADC but plummeted, resulting in the introduction of this ZiG currency.
The Patriot Front (TPF) said despite being penned to the international value of gold bullion, the new currency, introduced “for the umpteenth time” may still face devaluation similar to its predecessors due to various systemic issues.
TPF said policy inconsistency, corruption and lack of sound economic policies other factors such as economic mismanagement, excessive money print leading to inflation, weak infrastructure and reliance on imports could contribute to ZiG’s depreciation.
To maintain the strength of ZiG, TPF said Zimbabwe must implement robust economic reforms and adhere to fiscal discipline.
“This includes transparent and accountable governance implementing effective monetary policies to control inflation, invest in infrastructure and human capital development, fostering a conducive business environment to attract foreign investment, diversifying the economy beyond gold and promoting exports to earn foreign currency,” TPF said.
“Additionally maintaining a stable political environment free from corruption and ensuring the rule of law are all crucial.”
The opposition party said Zimbabwe also needs to explore other measures to enhance confidence in the ZiG like establishing independent institutions to oversee the monetary policy.
“Independent institutions must oversee the monetary policy, implement strict regulations to combat corruption, promote financial literacy among citizens and engage in International partnerships to support economic stability,” said the party.
TPF said a combination of prudent economic management, good governance and adherence to market fundamentals is essential for the ZiG to remain strong and resilient against external shocks.
Another opposition party, the Congress for Transformation (CFT) opposition party concurred that despite the several steps the central bank has made to control the “marauding” economic and fiscal conditions in the country, these steps were coming from a system with a less-than-a-stellar track record in terms of the economy and the fiscus.
“We would like to register our fears, which we are confident are universally shared by all economically and financially literate Zimbabweans as well as the rest by experience,” said CFT’s communication department.
CFT said their biggest fear is the “repetition of the history of policy inconsistencies that has become norm and hereditary to all successive administrations of the central Bank as well as economy.”
“Compounding our fears of failure of this monetary policy regime is the ever-present risk of blatant looting as practised over the years, particularly risk of looting of the gold bullion that now backs the newly introduced ZiG currency,” said the opposition party.
The opposition party said Zimbabwe has “been down this road before” when after the unexplained disappearance of the Zimbabwe gold bullion, coupled with targeted sanctions and restriction regime, the local currency nosedived into obscurity.
“The introduction of the new currency must come as a solution and not as another of the many political and economic crimes scams that our country has been subjected to,” said CFT.
For this new currency to be shockproof and for it to bring the ‘much needed’ relief to the long-suffering citizens, who have endured repeated episodes of “fraud at the hands of policymakers and implementors with the central bank playing the central role,” CFT said it had several suggestions that could be adopted and implemented by the responsible authorities.
“One, adopt a culture of fiscal discipline and religious policy consistency by the authorities. Adherence to prudent economic management practices, good governance as well as adherence to economic fundamentals are key ingredients to building this culture,” said the party.
“Two, a transformative economic reform agenda must be considered and taken upon to take the economy back on the pedestal of performance and growth and expansion.”
CFT said there must be a deliberate policy of diversification of the country’s economic activities beyond mining.
“Our country has vast other resources and possible contributors to the GDB other than minerals, which must be fully explored,” said the party.
“Three, political and social transformative reform is key in making sure there is sound policy formulation and attraction of investment.
“Transparency and accountability are key on this one, coupled with the implementation of effective monetary policies that curb or control inflation, investing in infrastructure and human resource development.”
CFT said fourth, a peaceful and soundly stable political environment must be created to boost investor confidence.
“Five, a concerted fight against corruption must be the priority of the authorities if any of the pronounced policy positions are to see the light of day,” said the party “Corruption and economic crime must be punished, not rewarded as is seemingly the norm in our country. It goes without saying that rule of law guarantees the stability and confidence we so desperately need.”
