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When rock Bottom has a basement- A call for monetary reform

Welcome to Zimbabwe! Where we as a people have since 1955 (then we were called Rhodesia) argued verbose arguments based on ideology (race, tribe, economic system etc) that at its core keeps a certain class of people subjugated with another rich and powerful. these arguments often ignore reality on the ground. Often those in power are shook by this reality that often has far-reaching, earth-shattering consequences.

We as a nation have seen reality take control every 25 or so years and really shake these dogmatic ideologies. The first was the racist Rhodesian government's ideology of white minority rule, or "Apartheid lite". The government of the day engaged in inward looking state-oriented economy that was built largely to meet the aspirations of the white minority. Our parents and those that came before them only gained value through serving these aspirations as labour (skilled or otherwise). 20 years of sanctions, civil disobedience and finally armed resistance led the racist Rhodesian regime to realize what military planners and colonial civil servants had clearly understood after World war 2 that Africa (and the rest of their colonies in Asia and Americas) could no longer be held by force and any co-existence had to be achieved with consent of the local populations through their representatives.

The next 20 years of Zimbabwe's journey was the independence era where the power consolidation and emergence of Zanu PF as the dominant political player took hold. The era of the developmental state took hold where there is an expectation of the state to work to provide the land of milk and honey. All that resulted here was a period of steady economic decline. This period 1980 to 2005 saw slow stagnation and decline as the state crowded out the private sector creating more than 70 state owned entities to drive the economy. The developmental state saw more populist policies begin to take hold aimed at creating some redress of the colonial past and renegade Rhodesia. The decline also coincided with political opposition all congregating around workers unions- who were worst affected by economic decline.        

Post 2005 and the era of the renegade sanctioned state has seen move towards private sector led growth. a rocky change of leadership with the support of the military in 2017. With the onset of the "Second Republic", efforts to revert to a more liberal economic model has been engaged. however, massive corruption and misuse of public fund have taken root. at the centre of all this are the Central Bank, and sanctions placed on the state and its affiliates. 

From a pragmatic point of view, the current government of Zimbabwe cannot engage in a root and stem fight against corruption because:

1. Corruption and patronage are tools to keep large bands of the population loyal. The purse keeps getting smaller to share, but the system rewards stalwarts for standing strong through real pressure of sanctions. While on the other hand, it also is the big stick to punish cadres with if they stray from the party/State lines.

2. Much of the circumvention of sanctions require a grey/opaque system with lax controls to work. The swashbuckling traders and dealers that win and lose need this cover to bring in the much needed currency and liquidity to keep the market operating. It gives the deniability for both the sanctioned and sanctioning party to operate a dysfunctional economy where the state of Zimbabwe doesn't fail and the USA and its allies can still exert influence.

What can be attended to by Zimbabwe in this melee of economic arm twisting and geo-political subterfuge is the management of our currency and setting the basis for value to be maintained by the citizenry. This can be done by monetary reform. Root and stem review of the monetary system has to be endeavored while diplomats work on a solution to sanctions (however, the USA doesn't negotiate on compromise and will only relent when Zimbabwe has submitted to the hegemony). 

We can look at the reform agenda in subsequent posts. The trick for Zimbabwe to resolve its challenges both short-term and directing the country towards long term sustainability is to properly diagnose the challenges as well as diligently work on areas that they can control. Let's talk next Monday.            

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