Zimbabwean govt panics as wheels come off

With Zimbabwe’s economy continuing to die — as manifested by rising poverty levels, worsening job losses and severe cash shortages — the government is showing signs of panic, amid fresh warnings by experts that the country is headed for an economic disaster akin to the meltdown of 2008.

This comes as the Reserve Bank of Zimbabwe (RBZ) has set the maximum limit for cash back facilities by retailers and wholesalers at $20, as authorities desperately try to mitigate the country’s worsening cash crisis which is forcing long-suffering Zimbabweans to spend hours at banks queuing for their money.

“Any cash-back facility made available by retailers and wholesalers shall not exceed an amount of $20.

“The Reserve Bank shall collaborate with wholesalers, retailers and their associations to ensure the adequate provision of Point of Sale (POS) machines in order to enhance the use of plastic money for transactions,” the under-pressure central bank said on Thursday.

But a government source who spoke to the Daily News yesterday said the country’s bigwigs were “panicking” over the ever-deteriorating state of the economy.

“I won’t lie to you, we are all panicking. While it’s clear that the Reserve Bank is doing its best, unfortunately our problems are deeper than the central bank’s mandate, which is why they appear to be treating the symptoms and not the causes of the problems,” the senior official said.

An executive with a retail chain, who spoke on condition of anonymity, also criticised what he called “panicky, knee-jerk” policy pronouncements by the government that he felt would not mitigate the dire situation obtaining on the ground.

“We have now reached a situation where we do not know whether to laugh or cry. I mean, what kind of policies are these where we are compelled to bank our money but can’t get this cash back when we need it?

“Our biggest fear is that this is more and more looking like the nightmare of 2008 . . . and while I’m not one of (People’s Democractic Party leader Tendai) Biti’s admirers, I think he was correct when he described our economy as a Ponzi scheme (a fraudulent investment operation),” he said.

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Source: Daily News

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