In an article published by The Source, financial, economics, investment, and public policy expert Mthuli Ncube listed 5 important areas of focus that Zimbabwe needs to focus on to create an economy that exhibits strong GDP growth over a period of 10 years.
Ncube said Zimbabwe must settle its external debt from multilateral institutions such as the African Development Bank, World Bank so that it can start borrowing from these institutions again. He adds that Zimbabwe has to create jobs saying that “Jobs are the silver bullet in any economy.” Ncube says there is also need to look at the long term skills development to create youths who are job ready. He argues there is also need to promote domestic investment and suggests the creation of a national venture fund, funded by the banking sector and pension funds to support new and current industries and take equity right across the economic spectrum.
Ncube also advises Zimbabwe to trade with everyone and not focus on only the East or West. he suggests that more emphasis should be on the relationship with the West since the relationship has not been very good. He argues that because of Brexit the UK really needs friends within the Commonwealth and as a result Zimbabwe must join the grouping or have trade agreements with the UK. He however cautions that Zimbabwe must not ignore China because that’s where the money is. He adds that Zimbabwe must deal with the currency issue by removing the bond notes. Below is an excerpt of Ncube’s article:
What I would argue now is that we remove the bond notes currency because it is becoming a surrogate currency to the Zimbabwean dollar without the macro economic credibility to support it. The bond note currency is bad money and we know that in economics, bad money drives out good money.
It’s not surprising that the US dollar is now in short supply because people are not banking them. So the immediate course of action is to remove the bond notes and then let the US dollar become the core currency but over time we have to bring back the Zimbabwe domestic currency. That’s what will deal with liquidity issues in a big way.
More: The Source
Professor Mthuli Ncube is the Minister of Finance and Economic Development.He was the Chief Economist and Vice President of the African Development Bank ,financial, economics, investment, and public policy expert, entrepreneur and academic. Professor Ncube divides his time between the private sector in Switzerland and... Read More About Mthuli Ncube
Bond Notes are a currency of notes backed by a bond that the Zimbabwe government announced on 4 May 2016 by Reserve Bank of Zimbabwe (RBZ) governor John Mangudya. The $2 denomination of the notes was finally introduced on 28 November 2016. More notes were... Read More About Bond Notes