HomeOpinion & AnalysisAd hoc taskforces duplicate role of ministers

Ad hoc taskforces duplicate role of ministers

Ngoni Chanakira



nt-family: ‘Times New Roman’; mso-fareast-language: JA”>LIKE a bolt from the blue, Zimbabweans were last week informed that government had finally got its act together and was about to solve the foreign currency shortages and other pressing economic matters.


But instead of working flat out to restore Zimbabwe’s crumbling economy by controlling soaring inflation, government has once again decided to buy time by setting up a taskforce to investigate the problem.


A cabinet “special taskforce” was announced last Wednesday.


This one, we were told, was designed to address the management of foreign currency after realising that the root cause of the economic problems was “the unaccountability of foreign currency by exporters and other players”.


The taskforce — comprising nine cabinet ministers, some of whom have been regularly recycled since Independence in 1980 — was formed through the reconstitution of the taskforce on the cash crisis. Its members are said to have resolved the shortage of bank notes that had gripped Zimbabwe of late.


Minister of Rural Resources and Water Development Joyce Mujuru will chair the taskforce which comprises the Minister of Finance and Economic Development, Herbert Murerwa, Minister of State for Information and Publicity Jonathan Moyo, Minister of State for National Security Nicholas Goche, and Industry and International Trade minister Samuel Mumbengegwi. Other members are Mines minister Edward Chindori-Chininga, Lands minister Joseph Made, Tourism minister Francis Nhema, and Home Affairs minister Kembo Mohadi.


The team will compile a “data bank” of all major exporting companies and examine foreign currency leakages and externalisation of funds by exporting entities including Export Processing Zone concerns.


It will also find ways of mobilising gold from small-scale miners and partners to market it through Fidelity Printers and Refiners (Pvt) Ltd — a subsidiary of the Reserve Bank of Zimbabwe (RBZ).


The high-powered team would also recommend the best foreign currency allocation mechanism in accordance with national priorities and recommend the formation of an appropriate central exporting authority.


On Thursday, a day after the taskforce was announced, we were told that the National Economic Consultative Forum (NECF) would meet to discuss the macro-economic situation prevailing in Zimbabwe.


The NECF is a 150-member team of businesspeople, politicians, labour chiefs, bankers and government officials hand-picked by President Robert Mugabe to devise strategies and solutions to the country’s myriad economic problems.


The special taskforce came as a surprise even to some NECF members, especially when there are less than three weeks to the 2004 national budget presentation in parliament by Finance minister Murerwa.


Analysts say what is now crystal clear is that the snail’s pace at which government goes about attending to burning issues and the use of taskforces and commissions of enquiry has resulted in feuding between politicians and technocrats.


Generally while politicians are fond of sloganeering and building castles in the air while the country’s economy burns, technocrats are hands-on people with little time for this.


Examples of such technocrats who served government include former Finance ministers Bernard Chidzero, Ariston Chambati, and Simba Makoni, as well as banker Nkosana Moyo.


Moyo made Zimbabwean history and ruffled feathers when he quit Mugabe’s government after realising that what he was recommending was falling on deaf ears.


On the other hand, while he did not resign, former Finance minister Makoni eventually felt President Mugabe’s boot. His crime? Recommending that the Zimbabwe dollar be devalued through the front door. The dollar was however later devalued through the back door — which became known as an exporters incentive!


Analysts point out that what government needs are not taskforces, but solutions to the many problems.


They query what exactly ministers are doing if taskforces have to be formed to run their ministries.


Cases of ministries which have had either a commission or a taskforce in action include Lands (under Made), Local Government and National Housing (under Ignatious Chombo), Sport and Recreation (under Mujuru), Higher Education (under Murerwa), and even Finance (again under Murerwa).


Before he left his job after a two-term stint, former RBZ governor Leonard Tsumba gave an interview to businessdigest on August 19.


Tsumba said foreign exchange shortages over the last five years had largely been a result of poor export performance.


 “The foreign exchange situation in the country remains critical against the background of declining inflows and widening demand for foreign currency,” her said.


“Foreign exchange shortages over the last five years have largely been a result of poor export performance due to a shrinking export base, deteriorating terms of trade for primary exports and the suspension of international balance of payments support, as well as drying up of external lines of credit. As a result, growth in exports has fallen from 13,9% in 1996 to an estimated minus 11,3% in 2002.”


Tsumba pointed out that while exports and export earnings had continued to decline, demand for foreign exchange to procure critical imports such as food, fuel, electricity, drugs and industrial inputs had risen sharply.


“The sharp escalation in inflation, from 55% at the end of December 1999 to just under 400% by July 2003, against levels of below 10% obtaining in most of the country’s regional and international trading partners, has severely affected export performance,” the outgoing RBZ boss said.


He said whereas in many developing countries widespread trade restrictions and stringent foreign exchange controls had led to the proliferation of parallel market forces for foreign exchange, the Zimbabwean situation arose from “persistent macroeconomic imbalances, in particular high inflation”.


“Speculators have taken advantage of the resultant crippling foreign exchange shortages to continuously depreciate the exchange rate for desperate importers in the parallel market,” Tsumba said. “The long-term solution to the problem of foreign exchange shortages and the parallel market, however, lies in the implementation of a consistent and comprehensive set of macroeconomic policies, aimed primarily at promoting export growth, so as to ensure that the economy realises adequate foreign exchange.”


When quizzed about the skewed exchange rate, which analysts contend is the main root of the foreign currency crisis, Tsumba pointed squarely at Murerwa.


“The exchange rate policy is a matter for the Minister of Finance and Economic Development,” he said. “Under the existing law, the Reserve Bank implements the exchange rate policy as announced by the minister. You may be aware that the National Economic Revival Plan provides for regular reviews of the export support rate, taking into account inflation and other macroeconomic developments. Consultations with key stakeholders are, however, under way to review the export support rate.”


Meanwhile, the taskforce last week blamed forces hostile to Zimbabwe who are “hoping to derail the land reform programme by killing agriculture through black marketeering and profiteering where prices have nothing to do with real costs”.


When he launched the short-lived Millennium Economic Recovery Programme on September 28 2000, Nkosana Moyo pointed out that divisions in Zimbabwe, be they party political one-upmanship or any abuse of influence in regard to the implementation of the programme, would only serve to make deeper the hole that the country had dug for itself.


“If we want to stop sinking — we simply have to stop digging,” he said then.


Bankers say the sooner government realises that we cannot write new economic rules that ignore supply and demand, the sooner we can set about implementing solutions to the economic mess that we are in.

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