Zimbabwe Absurdity

It made it a little easier after the breakdown on the road to come back to a house that was actually lit up after another 4 day power cut. I dread storms. This one had come through on Thursday and had hit with some force; 20mm of rain in 15 minutes and wind to match. The power lines behind my office had been arcing onto each other but amazingly did not burn through but somewhere else a tree had come down or so I presumed. Anyway, I did get to hear the news before going to sleep and I heard “As Robert Mugabe prepares to share power…” – some chance. After 28 years holding total control he is now going to share? “… SADCC countries are wondering whether to appeal for a complete lifting of sanctions which will make life easier for Zimbabwe’s people” the newsreader continued. I have harped on about this elsewhere and it’s worth repeating; the sanctions are targeted against the ruling party elite and their cronies. A quick trip into town will show that sanctions have little or no effect on the majority of people. Want a Benz? No problem sir! Imported double door fridge with in-the-door ice-maker? Certainly madam! The current financial mess is entirely of the ruling party’s doing.

Also on Thursday there was a budget (we seem to have budgets presented several times a year here). This one was a little different because it was presented in US dollars, probably because no-one understands the words required for the equivalent in local dollars. An uncommon amount of common sense was shown and essentially everyone is allowed to trade in US dollars or any other currency now. This had one of my customers all cock-a-hoop and amazingly optimistic. He seemed to think that it was all but over now and we would see the long promised “turnaround” in six months or so. And yes for a moment I was caught up in his infectious mood. But it still does not answer the question about where the cash is going to come from. We are still a nation of traders and it is going to take a massive cash injection to get us back on our feet. This might be bad timing given what’s going on in the financial world. Yes, he was right on a number of concerns; the money traders will be looking for work, those “farmers” who were benefitting from fuel and fertilizer handouts are unlikely to have much to trade (one was trying to sell him 10t of urea and did not even know what it was for) but we have a very, very long way to go. Forgive me for being sceptical but we have promised this all before.

Austin at the gym is a fairly reliable fellow when it comes to the economic barometer; as well as being a sports doctor he likes to keep abreast of what is going on and the nature of his business keeps him in touch with a lot of opinions. Chatting to him yesterday brought me “up to speed”. Apparently the price for dealing in real money is that we all have to open an FCA (foreign currency account) at the bank and deposit all our takings there. Right. In the past the government has plundered these FCAs regularly and there are still companies owed millions of US dollars – the money is in the account but somehow they just cannot get hold of it. A large proportion of our budget will be funded by a revised Customs and Excise Act. Do they think that the customs officials at the various borders who have been pocketing some R1000 (about $100) a day will now enforce all the necessary duties so that maybe, just maybe, they will get a cheque from the government for say $200 at the end of the day? The list goes on and on – all the incredible lack of forethought that we have come to expect from this government. It gets better though. The MDC with whom ZANU-PF are supposed to be sharing power (it must come about within the next 8 weeks in order for international funds to be released) are supposed to be getting control of the finance ministry and as far as they are concerned this is all just a bit of paper which they may choose to use, adapt or tear up as they see fit! So don’t hold your breath anyone…

Business has picked up quite considerably for me over the past week. Whether this is some sort of optimism in the future I am not sure but it does raise a bit of an issue for me. I will have to spend money that I don’t have in the business for the input costs and to replace worn out equipment. Will I get it back? If this is really a light at the end of the tunnel I don’t mind doing it but is it?