FINANCE and Economic Development Minister Professor Mthuli Ncube told the ruling Zanu-PF Politburo meeting this week that indeed, the economy is imploding and he’s running out of legroom to fix the mess as he is “not a magician”.
Both the Finance Minister and Reserve Bank of Zimbabwe governor John Mangudya on Wednesday came under the cross hairs of the Zanu-PF top decision making organ, with senior Politburo member Obert Mpofu warning that the economy will present problems for ruling party’s targets 5 million votes in the 2023 elections.
The Zimbabwe Independent reports that the Politburo summoned the Teo to explain the current crisis and how the country could emerge from runaway inflation, rapid price hikes and a highly unstable exchange rate, among other crises affecting the economy.
According to politburo sources, Ncube and Mangudya told the ruling party that unless urgent measures were put in place to boost production, the country may soon go down.
“The main issue was that of the economy and how prices of basic goods and services have skyrocketed so terribly since he became Finance Minister,” reports the business weekly, quoting reliable sources in Zanu-PF.
“He (Mthuli Ncube) was mainly taken to task by politburo members who are out of government over the state of the economy. The politburo members said they were deeply worried that this could alienate the party from potential voters because people are suffering.
“Most criticism came from Mpofu and Chinamasa, but all members basically expressed concern over the way the economy was being run.
“Generally, the two were being accused of working against the party’s targeted victory in the next plebiscite.
“As you may know, to us the government is subservient to the party, which is then responsible for articulating these policies to the people.
“So what we have done now is to summon some of these ministers whose policies seem to work against Zanu PF interests.”
According to the publication Mthuli Ncube, in particular, said the economy was going to take a long time to recover, depending on the necessary interventions.
“However, he indicated that in the long run, his Transitional Stabilization Programme (TSP) would bear fruit, but you could see no one was buying that narrative,” said the source.
Another publication reports that Mangudya’s crime, among many, is his stubborn reintroduction of the Zimbabwean dollar that has decimated savings.
The two however reportedly told the meeting they had no magic to turn around the economy, adding there were no meaningful solutions in sight.
“Politburo members came out guns blazing against Ncube, as they plainly vented their frustrations about the miserable state of the economy,” said the source.
“The main issue was that of the economy and how prices of basic goods and services have rocketed so terribly since he became finance minister.
“He was mainly taken to task by politburo members who are out of government.
“Politburo members said they were deeply worried this could alienate the party from potential voters because people are suffering.”
Much of the criticism reportedly came from Zanu PF secretary for administration Obert Mpofu and former finance minister Patrick Chinamasa.
“The two were being accused of working against the party,” said the source.
“They were clearly reminded that government is subservient to the party and served at its (Zanu PF) pleasure as it was responsible for articulating government policies to the people.
“They were told they must do something about the economy with great urgency since its their area of responsibility but they (Ncube and Mangudya) clearly stated that things have really gone out of hand and it would take a miracle for things to normalise anytime soon unless government, as a matter of urgency, develops a strategy to fund the productive sectors of the economy so as to cut costs,” the source said.
“Mthuli Ncube in particular said the economy was going to take a long time to recover depending on the necessary interventions.
“He however indicated that in the long run, his Transitional Stabilisation Programme (TSP) would bear fruit but you could see no one was buying that narrative.”
Mangudya, sources said, was asked to explain what he was doing to contain inflation which is mainly being driven by an uneven exchange rate owing to the parallel foreign currency trading.
In response, Mangudya reportedly said the central bank was being outfoxed by illegal forex dealers who appear to be always ahead.
“As governor, he was asked to do something about the high level of instability in the exchange rate which has seen the local currency getting so severely corroded that salaries no longer mean anything.
“Mangudya said the major problem was that we are importing everything as a country and producing very little.
“He said for instance, we grow wheat enough only to last three months and import wheat for the rest of the year, hence the high prices of bread.
“He told the meeting that unless government prioritised funding for the productive sectors of the economy, there was no hope.”
“Mangudya also said he was having a hard time trying to arrest runway inflation and was running out of options after so many loopholes emerged as he sought to close one.
“He said players in the forex dealings have become so cunning that by the time they (government) came up with a measure to control it, they would already have plotted a new way,” said the source.