A member of the President Advisory Council (PAC), Dr Shingi Munyeza, has said that bad governance practices have worked to diminish public confidence in the new currency.
He speaks after Zimbabwe just introduced Statutory Instrument 142 of 2019 which reintroduced the Zimbabwe dollar and also outlawed the use of all foreign currencies for domestic transactions.
Speaking at the Institute of Chartered Accountants of Zimbabwe (CAZ) breakfast meeting on the implications of the currency reforms on business yesterday, Munyeza said:
The problem that we are having or we have had, is bad governance, inconsistent policy framework and implementation, toxic politics, contested election results, a bad human rights record and freedoms record. So currency, we all know that 60 percent of the by-in on the currency is based on the confidence that the citizenry have on the currency. I hear a lot of people say it might be backed 100 percent on the resources and so on. There is a confidence deficit that we have.
He, however, observed that the move could have been justified given the prevalence of speculators on the market. He then suggested:
To bring back confidence, our Government and authorities have to show competence that they are doing the right thing, the right way at the right time. The next thing is that they have to demonstrate that they are accountable or they communicate properly what they are doing. There is ineffective communication on policy.
Meanwhile, some shops are reportedly lowering prices of commodities in response to the SI.