Statutory instrument 142 of 2019 turns one month old today. The law that brought an end to the multi-currency era and (though coincidental) a return to hyperinflation has had a lot said about it. Finance Minister Mthuli Ncube hailed it as part of the Transitional Stabilisation Program and that it was always in the plan. However, the statutory instrument has seen exceptions being made to it and this does not quite sit well with the people.
Firstly the law itself was ushered in the still of night and as such it did not exactly receive the best of welcomes when it arrived. However, Finance Minister Mthuli Ncube assured us that there was lots of consultation and consideration before the stealthy introduction. A month down the line it’s really hard to believe the minister as so many changes have been made to the law or additional explanations have been required.
The position on Non-Governmental Organisations and Foreign Missions being allowed to continue paying salaries in foreign currency was the first. We recently saw an exception to hotels and mines who would be allowed to pay their electricity dues in foreign currency to assure them electricity supply. The latest one is baffling though and perhaps the most problematic. DStv parent Multichoice has been allowed to charge subscriptions in US dollars.
For a little perspective let’s consider the situation on the ground. A recent fuel price hike has done nothing to alleviate the challenges with supply or demand for that matter. That fuel price still stands at below US$1 (unless the rumoured hike happens today) means we will continue to see shortages. The fuel is subsidised but the government cannot subsidise enough to meet the national demand. Fuel companies would surely be the first in line to ask for US dollar payments.
Over the weekend the nation nearly came to a halt because the ubiquitous mobile money service Ecocash experienced outages which were later attributed to power outages. Again a situation that perhaps would be better served by allowing US dollar usage. And we can really go on and on here, there are many situations that could use such an intervention. And yes, these are necessities and US dollars would be out of the reach of ordinary people. However, being able to afford a service you cannot receive isn’t any better.
The argument in the eyes of many is that entertainment has been prioritised over issues of national importance. Furthermore allowing pay television payments in foreign currency while starving the electricity provider or the alternative energy provider still means people cant access the service.
This is another show of gross policy inconsistency from our government in general and the Ministry of Finance in particular. At a time when the drive is to foster confidence in the Zimbabwean dollar. This policy wasn’t thought out as carefully as we’ve been lead to believe. Observers have noted how much patchwork has been done on the policy since its introduction and also how those changes vary wildly on the overall position. The midterm fiscal statement looms and we await to see if it will offer any further policy direction or we will just continue down this path where the rules seem to literally be made up as we go.