Respect Gwenzi

News about a pending currency coming to the market in a fortnight made headlines on Tuesday even as it abated confusion over the reintroduction of the currency in question. The confusion pertains to whether the currency is a new currency different from the one introduced in June or in February, whichever point one prefers. Some believe the currency has been there since three months ago, while others are of the view that it has been there since February and some say it was there since October 2018. Interestingly my view is far off from all those that are conventionally shared, and in later parts of this article I will share my view on the not so new ‘new currency’s origins. On Tuesday, the central bank governor who is also the chairperson of the Monetary Policy Committee briefed the media following a two-day sitting by the Monetary Policy Committee, a first since the committee was set up.

In his brief, the governor said the b ank will soon (in a fortnight) issue new notes and coins different from the bond notes to supplement cash supply which he had long singled out as being in short supply. A frenzied media, could not find the right words and should be forgiven for running headlines such as new currency in two weeks or Zimdollar coming in a fortnight. Indeed, the staggered approach by the bank is very confusing to the average citizen as well as the media given that barely three months ago, media carried the same line having run with the same again in February. However a sober review of actualities reveal that these different pronouncements at varying points were all interlinked but signified different stages in the reintroduction of the local currency. My views, however, stretch beyond the common eye and establish empirically that the Zimdollar was unofficially with us for at least, the last five years.

Some like regional companies, notably Old Mutual and Standard Bank and Pick and Pay SA have long accounted for Zim earnings at a discount to the US dollar, as far back as October 2018. In their earnings report they used an average exchange rate of 1:3. They argue that this is the exact point Zimbabwe officially dollarised because that is when FCAs were separated to show disparity in value and based on market forces, the demand for US$ has been relatively higher resulting in a weaker exchange rate for the emerging currency then loosely referred to as RTGS$. On February 22, 2019, government introduced an interbank market for the trading of forex. This meant that forex held in FCAs could be changed at a market rate. An introductory exchange was pegged at 1:2,5.

The liberalisation was a clear subjection of exchange price discovery to market forces, although this was only partial and companies were compelled through a statutory instrument to convert US$ valued assets within their balance to RTGS$ at the respective rate of 1,2,5. The official reporting currency for companies effectively changed to RTGS. It is therefore argued by some that the Zimdollar returned at this stage and not earlier in October 2018 and there is partial truth to either assertions.

However, on June 23 through SI142, the Minister of Finance officially announced the reintroduction of the Zimdollar, which was to be effected through the conversion of a currency bundle previously known as the RTGS$.

The currency bundle was made up of electronic RTGS balances, bond notes and coins. At the same time the 10-year multi-currency system was scrapped. Again, technically, some refer to this point as the Zimdollar return date. Much of the assertion is driven by the fact that, this was the period transactions in other currencies were officially banned and for the first time in 10 years, the name Zimdollar was attributed to a currency. In principle, it would be justified that this would be the actual point of the Zimdollar return.

The latest dynamic is, however, interesting in that although all these successive pronouncements and manoeuvres were made, a physical note referencing the new “currency” was not brought into the picture. Well this sounds confusing because all this while we have been referring to different possible points the currency was purported to have been reintroduced. I have put the word currency in quote to demonstrate that, what the ordinary street folk refers to as currency is the physical note, ignore that which funds the withdrawal of those respective funds, an RTGS (electronic) funded Zimdollar account. So to a common man the physical copy is the ultimate currency and its pronouncement as was done by the RBZ governor on Tuesday signified a return of the Zimdollar currency at that point, and not the previous two instances. While this seems funny, it is not.

The ordinary folk has a significant influence on the confidence matrix. This class of citizens relates more to physical copies of money than to RTGS electronic balances. Their perception of a currency’s strength is determined by the physical copy and this is largely because over the lost decade (1998-2008) Zimbabwe had low utilisation levels of electronic channels compared to the ensuing decade. Cash was the money and given how Gono made it very unpopular through rabid and untamed printing, it became so unliked and distasted by ordinary Zimbabweans.

This is why news of a new paper currency is a big deal and why most journalists have referred to it as new currency introduction, to relate with their readers and common men appreciation. The underlying question of when the Zimdollar currency returned officially or otherwise runs deep and some refer to November 2016, that is around the period the bond note was introduced. An acute cash shortage was already prevailing at that point. The forex queues at the RBZ were growing and bottlenecks deepening. A tiered pricing model was now evident in the market.

The RBZ, however, continued to clear foreign currency transactions at 1:1 although the pace was very erratic. My own submission is that the local currency came a bit earlier than that and as is my typical style I will support this assertion with empirical evidence. I would pick 2014 as the defining moment for the local currency return. Seeing the outcome as it is today, one will be persuaded to believe that the return of the Zimdollar was premeditated by the Zanu PF government when it won the 2013 election. This is so because after winning the election, the government went on a borrowing spree on the local market through Treasury Bills (TBs) and by August 2018, the TBs balances were at $7,8 billion as shown below. TBs are an instrument used by RBZ to control liquidity in the market. Government, however, uses the instrument only to borrow money from the local market and this money has largely been channelled to off-budget financing, that is projects and other expenditures which were not covered by the budget,
Command Agriculture ranks on top of these expenses.

So by creating off-budget needs government found a justification for seeking off-budget financing. It sounds ridiculous but suppose government felt otherwise, there was room to forgo these projects simply because they were not budgeted for. Even as that happened, the fiscus remained bloated with significant allocations being channelled towards recurrent expenditure, mainly salaries. On top of that, corruption, incompetence and inefficiencies weighed on the public service, thereby draining the fiscus. The government thus found the TBs route convenient. In just under five years it had a accrued over $8 billion in TBs and given that these are short-term instruments, roll-overs and discounts in secondary market sped the rate of growth in money supply. In just under five years money supply grew from $4 billion to $10 billion. But was this growth backed by real US$ cash? No it wasn’t, as shown below from a high of 49%, hard cash ratio, which is the ratio between system deposits and FCA nostro added to physical US$ and bond notes and coins, has crushed to a low of 3% as of December 2018. Given further growth in money supply in 2019, it follows that the ratio of hard cash to deposits has further dissipated.

This clearly shows that from 2015 onwards, Zimbabwe had begun using a local currency as deposits were not backed by hard cash. Loosely, the difference between hard cash and system deposits above refers to a new currency that was being created, which has manifested in different ways to become the Zimdollar of 2019. This ratio is not the same as cash ratio which the governor says has to be moved from 4% to 15%. It speaks to the underlying cash-flow and its nature. The underlying cash-flow created from TBs was not US$ (production) denominated in practice and this explains why RBZ struggled for years to clear the forex queue because the market was no longer a US$ market in practice. So many things are going on right now at the central bank which would shock the market in not-so-distant a future.

The citizenry need to stay awake and vigilant and call authorities to account even as companies shape own survival strategies to avoid another possible 2008.
 Respect Gwenzi is the managing director and lead analyst at research firm, Equity Axis

BY KENNETH NYANGANI

MANICA DIAMONDS…(0)1
DYNAMOS ………………..(0)1

IT IS eight straight draws and 15 in total for Dynamos this season as the Harare giants gave away a goal lead to settle for another stalemate this time against Manica Diamonds at Vengere Stadium in Rusape yesterday.

Their 15 draws are only equalled by Herentals, a run that has seen them surrendering in the title race and now fighting to finish inside the top four.

DeMbare are currently on fifth position and had they won half of the matches that they have drawn this season, they could be top of the log standings at the moment.

But for a team that struggled early in the season, they would probably be happy with what they have at the moment and hope to build from there next season.

“We are in a transitional period and our current draws show where we are as a team and most of my players are youngsters and they are still learning the ropes,” said Dynamos coach Tonderai Ndiraya.

Just like they have done in most of the matches which they eventually drew, Dynamos went ahead through Sean Gona on the 55th minute, but allowed their opponents to equalise, with Last Jesi levelling the scores for the hosts 13 minutes later.

Manica Diamonds coach Johannes Nhumwa rued the many missed chances.

“It was another match where we missed chances. We could have won at least 2-1, but my boys missed chances. We have to continue to work on that aspect if we want to finish in the top-eight,” he said.

The match started on a rather snail’s pace and the visitors were the first to threaten when defender Munyaradzi Mawadza forced an acrobatic save from veteran shot-stopper Tafadzwa Dube.
The home side created a chance of their own moments later and Mawadza was again called into action, clearing on the line a goal-bound shot.

Both teams continued to exchange blows going into the second stanza.

Dynamos upped the tempo in the second half and were duly rewarded when Gona capitalised on a defensive mix-up.

Nhumwa responded to the setback by introducing Ishmael Lawe for Kudakwashe Gurure on the hour mark.

The substitute changed the complexion of the match as he started to dictate the pace in the middle of the park.

Lawe won a free-kick on the edge of the box and outstanding Manica Diamonds player this term, Jesi, jerked off fans from their seats with a David Beckham-esque free-kick from outside the box that left Warriors goalkeeper Simba Chinani rooted to the spot.

Manica Diamonds should have sealed the points three minutes later when Stanley Ngala was sent through by Jesi only to shoot wide.

Lawe then dazzled the Dynamos defence late on before crossing to Rodrick Mufudza who skied his shot over the bar.

Delegates from 10 countries pose for a group photograph while attending a UNODC regional training of rainers’ workshop addressing issues of HIV and Sexual Reproductive Health and Rights (SRHR) in prison last week.

By Moses Magadza

WINDHOEK – A regional training of trainers’ workshop addressing issues of HIV and Sexual Reproductive Health and Rights (SRHR) in prison settings ended in Namibia last week with a call to safeguard the health of people in prison in order to protect public health.

The training workshop drew about 60 participants from 10 countries: Angola; Kenya; Lesotho; Malawi; Mozambique; Namibia; Eswatini; Tanzania, Zambia and Zimbabwe. Delegates were staff of prisons including medical doctors, Ministry of Health staff, staff of national

AIDS authorities and representatives of organizations that provide SRHR and HIV services in prisons.

The United Nations Office on Drugs and Crime (UNODC) convened the training with financial support from the Swedish International Development Agency (SIDA). UNODC is supporting member states to implement a regional programme titled: “Supporting Minimum Standards for HIV, Health and Rights in Prison Populations of Sub-Saharan Africa”. The project seeks alignment of SRHR with UN regional standards. Specifically, it strives to help member of states makeSRHR services available to women and adolescent prison populations.

To this end, UNODC has supported the development of a module to build the capacity of non-medical staff of prison or correctional services to deliver comprehensive SRHR and HIV services to inmates under their care.

Speaking at the beginning of the three-day training, the Commissioner General of the Namibian Correctional Service (NCS), Raphael Hamunyela, argued that prisons or correctional services should provide health care that is similar or better than is found in the general community because of the unique vulnerabilities of people in incarceration.

“We believe in the principle that good correctional health is good public health. Since those under our care often come from backgrounds of higher exposure to a variety of diseases and unhealthy conditions, there is need for correctional services, prisons or penitentiary services to deliver equal or better health care services than are in the community,” he said.

He hailed the training and expressed optimism that it would throw a light on HIV and SRHR issues that need attention in prisons as member states strive to comply with the Nelson Mandela Rules which prescribe a minimum package of services that Member States should make available to people in prisons or correctional services. The Nelson Mandela rules acknowledge the rights of inmates. Hamunyela said NCS was also implementing the regional programme on supporting minimum standards for HIV, health and rights of offenders and called for integration of relevant services.

“We must acknowledge that HIV and SRHR should be integrated within our policies plans and operations,” he said.

He said NCS would this year integrate the new SRHR and HIV module in its training curriculum to ensure that all officers gain relevant skills and knowledge.

Also speaking at the start of the training, Signe Rotberga, the Regional Coordinator for UNODC in Southern Africa, said the training was timely given that UNODC was implementing a regional project on promoting compliance with international standards for HIV and SRHR services and rights.

“Recently, we did an assessment in 10 countries that are participating in this project. This survey identified several gaps that need to be addressed. Other gaps are related to policies and laws. In some countries, certain behaviors such as those of commercial sex workers, people who use drugs or engage in same sex relationships are still criminalized. This drives some people underground and away from essential health services at a time when the world has set targets to end HIV and AIDS,” she said.

She said due to criminalization, many members of key populations end up in correctional facilities. She hoped that the training would provide an opportunity for exchange of views on how best to meet the needs people in custody and to embrace best practices such as the use of non-custodial sentences for non-violent crimes.

Rotberga said that the UNODC-initiated survey had shown, also, that there was insufficient training on human rights related issues and SRHR in most of Member States.

The training took place against the backdrop of reports that the world is grappling a growing prison population. The International Center for Prison Studies reports that approximately 10 .35 million prisoners are behind bars at any given day, leading to chronic overcrowding of prisons in some countries.

Many other authoritative peer-reviewed sources say that prisoners, who form part of key populations, remain extremely vulnerable to infectious diseases. Additionally, prisoners must contend with stigma, denial and violence. The Lancet and other sources report that the population of female inmates has increased by 50% since the year 2000 globally in the face of lack of integration of prison health care into public health systems.

Professor Heino Stover from Frankfurt University of Applied Sciences was one of the facilitators during the training. He said women inmates bear a disproportionate burden of infectious diseases in many prison settings and thus require targeted interventions.

“Women are highly susceptible to infection with HIV and other sexually transmitted infections in prison as they often come from socially marginalized groups and are vulnerable to sexual abuse and exploitation in the prison environment,” he said.

Discussions during the highly interactive training touched on a variety of issues that included mental health; the use of uniforms by staff and inmates; prevention of harm; continuity of care; human rights;

Sustainable Development Goals, especially SDGs 3, 5 and 16; global commitments to prison health; HIV and AIDS prevention in prison; as well as sexually transmitted infections.

Among the highlights of the training was a visit by participants to the Windhoek Correctional Service in Namibia where UNODC helped set up a clinic in the female section of that facility.

In separate interviews, participants expressed gratitude for the training and said they had acquired knowledge and skills for use in their various workplaces to improve the welfare of inmates under their care.

Magren Paul, a registered nurse and an inspector at the Malawi Prison Service’s headquarters in Zomba, described the training is an eye-opener.

“The training had a positive impact on me. I had never attended training on SRHR and HIV. It became clear that we have been neglecting issues related to the health of female inmates. During the training, it struck me that there are many issues that I did not properly consider in the past. I feel empowered,” she said.

Olivia Obell, the Director of the AIDS Control Unit in the Kenya Prisons Service, also hailed the training and called for more similar capacity building initiatives.

“The prison communities – inmates, staff members and families- are currently witnessing unprecedented challenges implementing effective interventions in HIV prevention, treatment, care and support. There are new cases of HIV and TB infections. Besides, the prison fraternity is witnessing increased new cases of missing TB patients who should have been screened and put on treatment. This is mainly because of inadequate understanding and skills in screening, management and support for these particular patients,” she said.

She added that prison conditions such as poor infrastructure, inadequate medical infrastructure, low funding and inadequate skills may thwart the attainment of desired outcomes.

She added: “This training came in handy and will likely capacitate prison administrators including healthcare providers and practitioners with relevant skills and knowledge to reduce new infections and provide care for those already affected. All prison officers interact with inmates and fellow employees and with the skills that the training provided, they are now crucial in providing and strengthening services and removing barriers.”

-Moses Magadza is the Communications Officer for the Pretoria-based UNODC Regional Office for Southern Africa.

BY VENERANDA LANGA

parliament’s Public Accounts Committee (PAC) has claimed that the Finance ministry “passed a live snake” to Reserve Bank of Zimbabwe (RBZ) governor John Mangudya after instructing him to issue more Treasury Bills (TBs) amounting to US$202 million to different companies without seeking legislators’ approval.

Mangudya last week appeared before Parliament where PAC, led by Tendai Biti, quizzed him over TBs that were unprocedurally issued as bailouts to different companies in 2017 and 2018.

PAC member Edwin Mushoriwa (MDC Alliance) asked Mangudya to explain some of the TBs that were issued for the Presidential Input Scheme with no supporting letters showing that the RBZ was given authority by the Finance ministry to issue them.

“There were US$202 million TBs with no proof or authorisation letters,” Mushoriwa said.

“For the FSG (Fertiliser Seed and Grain), there were six TBs of US$9,3 million, US$8,1m for Quton, US$8,8m for Windmill, US$132m for Sedco and another US$12m for Windmill, US4,3m for Sable Chemicals and US$8,9m for ZFC, and US$12,8m for Hwange Colliery, among others,” he added.

“The ministry spent money outside the blue book and they said it is not their problem and then they passed the live snake to you. US$2,1 billion was spent in 2017 and US$1,5 billion in 2018 and it means that the bulk of the money was spent outside Parliament approval and outside the Appropriation Act.”

On Monday, the PAC members said they were also keen to grill FSG managing director Steve Morland over US$400m his company allegedly got from Command Agriculture.

Mangudya confirmed that all TBs were authorised by the Finance ministry.

“I would like MPs to learn and understand the role of the central bank because sometimes I think it is blurred. The central bank is a banker to government through the Finance ministry and it is adviser to all banks. It is adviser and fiscal agent to the State and once you (MPs) know the definition it will be easy to understand who gives what.

“Section 6 (1) (g) of the RBZ Act defines our functions, which is the stability of the exchange rate. Section 8 of the RBZ Act says the bank shall act as vendor to the State and carry transactions in such a manner that the State may require and make necessary arrangements. So all the instructions were authorised by the Finance minister,” Mangudya said.

The committee has re-summoned the Finance ministry to appear again before it, as well as FSG, Sakunda and Croco Motors which benefitted from the funds.

BY BLESSED MHLANGA

SENIOR doctors at public hospitals have accused government of committing a silent genocide by refusing to accede to their junior counterparts’ salary demands which has culminated in a two-month-long strike.

In a letter dated October 24 and addressed to Health minister Obadiah Moyo, Senior Hospital Doctors Association (SHDA) said the stand-off was likely to drag on as long as the government continues to persecute junior doctors and cast a blind eye to the current incapacitation at health institutions.

In their letter copied to President Emmerson Mnangagwa, the doctors said there was no justification for government to refuse to pay them United States dollar-benchmarked salaries when the cost of most services and goods were pegged in the same currency.

“Goods and services are pegged in US dollars, making our demand reasonable in order to sustain service delivery,” the letter read.

“It is our view that the government is currently committing a silent genocide by casting a blind eye to the current incapacitation in hospitals. May we remind you of the constitutional mandate of the government as spelt out in section 29 of the Constitution of Zimbabwe of 2013.”

The two-month-long strike by members of the Zimbabwe Hospitals Doctors’ Association (ZHDA) has effectively forced hospitals to shut down.

“As doctors, we work as a team, we need junior and middle-level doctors to be able to function. We are against victimisation of our junior colleagues through hearings and threats of suspensions, yet they are finding it difficult to come to work because of poor earnings. Their incapacitation must be resolved,” the letter added.

Government has withheld salaries of all doctors who have been on strike, saying they will not be paid unless they return to work.

“The SHDA finds the withholding of the paltry salaries to be a joke. If there was a salary to talk about, we would have reason to worry. We hope you shall use the withheld cumulative amounts to capacitate hospitals,” SHDA said.

Nurses have been allowed to work flexible hours by coming to work at least two days a week to ensure that they avoid incapacitation, but SHDA said this arrangement was not good for the health delivery system.

“The flexi hours for nurses and other hospital staff system must be abolished with immediate effect as it is detrimental to patient care, causing avoidable morbidity and mortality. No hospital can function and be able to offer services under such arrangements. Senior doctors are not returning to work in flexi-hours system,” the letter read.

BY SIBONGINKOSI MAPHOSA / PRAISEMORE SITHOLE

INDONESIAN ambassador to Zimbabwe, Juniarta Sastrawan and his delegation yesterday met Bulawayo Metropolitan Affairs minister Judith Ncube to deliberate on the Asian country’s plans to resuscitate and capacitate the struggling National Railways of Zimbabwe (NRZ).

Sastrawan held a closed-door meeting with Ncube at the NRZ Bulawayo main station offices before a tour of the premises.

After the meeting, Sastrawan told NewsDay that his country wanted to revive NRZ, describing the parastatal as a low-hanging fruit because it has its own machinery and manpower.

“My mission here is to strengthen the economic co-operation and the railway industry is one of the low-hanging fruits that I can do. I want to see how we can partner with Zimbabwe and contribute to the blueprint of the economic reform,” he said.

Sastrawan has been an adviser to his country’s Transport and Infrastructure minister and is well-versed in transport and infrastructure planning.

“We are making a more detailed plan on capacity-building. Hopefully, by next year, we can start something, a concrete plan on the capacity-building that we have,” he said.

Sastrawan also said they were not in the country only as investors, but also as partners with NRZ.

NRZ board chairperson Martin Dinha said they were excited to engage Indonesia in the resuscitation of the parastatal, a move that comes at a time the country is facing a serious economic meltdown.

“We have been having active engagements for the past months with the Indonesian ambassador and we are happy our engagements are yielding positive results, as evidenced by this event that we are having today,” he said.

Dinha said their delegation visited Indonesia in preparation for a long-standing relationship in industrial infrastructural development during the Africa Indonesia summit.

“We went to Indonesia last month to attend the Africa-Indonesia summit and during that summit, we mapped a way forward on infrastructural development in Zimbabwe precisely,” he said.

NRZ general manager Lewis Mukwada said the parastatal boasts of having the second largest railway workshop in the southern region after South Africa.

“NRZ has huge and fantastic facilities that we can work on from end to end, meaning that it’s not that we can have capacity-building on the operation of railway, but also on the production of railing stock,” Sastrawan said.

Indonesia’s interests in partnering Zimbabwe come after government recently cancelled NRZ’s US$400 million contract with Diaspora Infrastructure Development Group (DIDG)/Transnet under unclear circumstances.

The US$400 million deal was meant to cover only the first phase of NRZ’s restoration.

To get back on track, NRZ needs US$2 billion in investment, according to an Infrastructure Development Bank of Zimbabwe assessment report.

Last year, as part of a temporary agreement, DIDG delivered 13 locomotives, 200 wagons and six passenger coaches on a lease arrangement to the NRZ.

In cancelling the deal, government gave inconsistent excuses and retendered.

BY FARAI MATIASHE

THE Harare City Council (HCC) is lobbying government to allow it to collect rates in foreign currency from business and corporates that have licences to trade in foreign currency as part of initiatives to strengthen service delivery.

The facility has been granted to the Zimbabwe Revenue Authority, where businesses that are trading in multi-currencies remit their taxes in the same currency, in which the goods have been sold.

Speaking on the state of the city yesterday, Harare mayor Herbert Gomba said the move would enable them to procure plant and equipment that require foreign currency.

“The City of Harare appreciates the economic challenges our residents are facing, hence we have tried to ensure that our rates and tariffs remain sub-economic,” he said.

“We have, however, explored other revenue generation streams, which we hope to implement next year. Council is also engaging government in a bid to secure authority to charge certain ratepayers, services and products in forex. The city is targeting such businesses to pay for services in foreign currency, as well as those in the diaspora who might want to purchase residential stands, among others,” he said.

“This will allow council to invest in service delivery initiatives such as procurement of plant and equipment. The above is not peculiar to Harare alone, because some fast-food outlets designated tourism facilities are allowed to charge in forex.”

Gomba said they were proposing a 20% infrastructure development tax on property developers when they connect their projects to existing infrastructure, which will give the city money dedicated on infrastructure development.

The mayor called on parliamentarians and councils to work hand-in-hand to push the government to review the current tax laws.

To recover the estimated $800 million owed by ratepayers, Gomba said council was lobbying Parliament to make legislative reforms so as to give them garnishing powers, where they would start using force to get money from individuals and corporates.

He said plans were underway to procure mobile modular water treatment plants to cater for the disadvantaged areas such as Sentosa, which have had perennial water challenges.

BY EVERSON MUSHAVA

PRESIDENT Emmerson Mnangagwa’s embattled government has reportedly resorted to unorthodox means to force its impoverished workers to continue reporting for duty after refusing to pay them United States dollar-benchmarked salaries.

Apex Council spokesperson David Dzatsunga told NewsDay on Monday that government was using coercive tactics, such as work attendance registers, to identify workers who fail to report for duty after the public workers declared incapacitation.

The intimidatory tactics include marking of registers and using councillors who threaten to report absent workers in rural areas, especially teachers.

“Clearly, workers are largely incapacitated, but it is unfortunate that there are reports of intimidation served through the administrative machinery by way of registers. Consequently, workers just find some and any means to report for duty,” Dzatsunga said.

Civil servants declared incapacitation on October 15, a day after they submitted a demand to their employer in a National Joint Negotiating Council meeting that their salaries be pegged in US dollar value and paid at the current interbank rate.

The least paid government worker is earning about $1 023, an amount only enough to buy US$50 on the black market at a time the country is experiencing a grave economic meltdown characterised by skyrocketing inflation, shortages of fuel as well as constant plummeting of the local currency to the US dollar.

This fall in value of the local currency has forced teachers and other public sector workers to introduce a two-day working week.

Last Friday, Finance minister Mthuli Ncube revealed he was unable to meet their US-benchmarked demands, promising another cushioning allowance for workers, before payment of bonuses next month.

Dzatsunga said his organisation would meet today to review the situation and map a way forward in light of the threats.

“We are going … to meet tomorrow (today) as Apex to consider some options,” he said

NewsDay has been informed that some councillors had been moving around rural schools threatening to report teachers who fail to turn up for work.

The Zanu PF councillors have been targeting headmasters, forcing them to mark attendance registers and report absentee teachers to them so that they could report direct to Mnangagwa.

The threats came after the councillors met the President in Harare last week.

“Councillors came from meeting with the President and they claimed they were told to call his office if any teacher is not working,” a teacher who requested anonymity said.

“Headmasters are demanding that anyone who cannot attend work for any reason, including incapacitation, should submit their names. In addition, we are required to dress formally up to 4pm, otherwise the headmasters will submit our names to the councillors, who will report to President Mnangagwa.”

The teachers said they had reported the matter to their unions.

Progressive Teachers Union of Zimbabwe president Takavafira Zhou confirmed receiving the reports, and said he had since advised the teachers to put the complaints in writing for them to act.

BY VENERANDA LANGA

THE central bank yesterday said it would introduce new currency notes and coins in the next two weeks, as it moves to restore the domestic currency which fell victim to hyperinflation and was dumped in 2009.

The new money, comprising $5 notes and $2 coins, will be introduced gradually to ease shortages of the bond note while ensuring that it does not drive up inflation, Reserve Bank of Zimbabwe governor John Mangudya said.

It will circulate alongside the bond notes and coins introduced in 2016 as a surrogate of the US dollar, which the country was then mainly using in-lieu of
its own currency.

The central bank unexpectedly reintroduced the Zimbabwe dollar on June 24, ending a decade of dollarisation.

“We thought of being conservative (in introducing low denomination notes and coins) and we will graduate with time,” Mangudya told journalists after a two-day Monetary Policy Committee (MPC) meeting in Harare.

It was the first meeting of the MPC since its appointment by Finance minister Mthuli Ncube last month.

Zimbabwe is grappling with its worst economic crisis in a decade, marked by shortages of foreign exchange, fuel and medicines, three-digit inflation and 18-hour daily power cuts.

The central bank boss also confirmed that the economy is expected to shrink by 6,5% this year, while month-to-month inflation will be between 10% and 12% by year end.

While year-on-year inflation was at 353,32% in September, government suspended in August publication of the figures when it topped 176%.

Mangudya, however, declined to give the name of the currency, only opting to say it would be nameless and would complement the already existing bond notes and coins in order to increase the cash circulation.

“We already have bond coins and notes in circulation, as well as $2 and $5 bond notes, but now we are going to have the already circulating bond coins and notes and the $2 new currency coins and $5 new currency notes,” Mangudya said.

“They are going to be used interchangeably at 1:1 rate and the new currency will not be in our bond notes (form), they will be called $2 or $5,” he said.

Asked to produce the specimens for the new $2 coins, and $5 notes, Mangudya said there were some legal processes that needed to be satisfied first before the specimens were made public.

“We shall give you the specimen later because whatever new currency you are introducing needs to be first gazetted through a statutory instrument (SI), and then after gazetting we do the necessary advertising. We cannot do that before the legal instruments are put in place. We need the legal reforms first,” he said.

Mangudya said he would increase the cash supply and revise the withdrawal limits upwards so that people do not have to pay premiums for their cash.

“Precisely, I would say that within the next two weeks, we will be having the cash — and cash does not mean increase in inflation,” he said.

Asked to explain why he was introducing small denominations of notes in an economy already hit by cash shortages and inflation, Mangudya said: “For now we will do the $2 notes, $5 notes and $2 coins so that they do not depreciate as soon as possible.”

Mangudya said the MPC had noted that the increase in reserve money by 80% during the first eight months of 2019 compared to December 2018 position had triggered instability in the exchange rate and resulted in the increase of prices of most goods and services.

He said there was need to contain money supply growth within levels that will ensure exchange rate stability and inflation reduction.

Last week, Mangudya was quizzed by Parliament’s Public Accounts Committee, led by Tendai Biti, on revelations that about 10 individuals in the country controlled the US dollar market in the country.

Yesterday, he, however, said 50% of the country’s deposits were owned by 50 corporates.

“So 50% of the $19 billion money supply is in the hands of 50 corporates and so it means we are predominantly a poor country,” he said.

“We must not allow such a thing to happen because at the end of the day, prices will affect everyone in the economy. We are not targeting individuals, we are targeting those with sufficient energy to influence the market.”

On curbing illicit financial deals and massive profiteering by EcoCash agents, Mangudya said the RBZ’s Financial Intelligence Unit had already been deployed, adding that the behaviour of bureaux de change would also be monitored.

On reports that the Chinese government had expended funds for the Robert Gabriel Mugabe International Airport expansion after he released money to Sakunda Holdings on a 1:1 rate to the US dollar, Mangudya said the issue was based on hearsay.

The RBZ governor said the total harnessed funds since he introduced the interbank exchange rate towards the end of last year was US$1,3 billion, being purchases by customers.

He said most of the money was being channelled towards purchases of fuel, adding that the equilibrium in the interbank exchange rate would be a level of 5 to 8 to the United States dollar.

Mangudya said the MPC has noted with concern the continued inflationary pressures in the economy, projected to recede in the outlook period as attested by the recent decline in monthly inflation from 39,26% in June 2019 to 18,07% in August and further to 17,72% in September 2019.

— Additional reporting by Reuters