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Finance minister Mthuli Ncube


‘President rewards mythmaking’



as Mthuli Ncube retains post

SMARTING from a hotly-contested presidential election, Zimbabwean leader Emmerson Mnangagwa appointed his new cabinet and ordinarily there would be movers and shakers.


Finance minister Mthuli Ncube has been appointed at the benevolence of Mnangagwa after he lost in Bulawayo’s Cowdray Park constituency to the opposition CCC.

When he was appointed in 2018, he did not have political clout. There was a strong lobby by hawkish Zanu PF stalwarts seeking to block his appointment.

He has come back more vulnerable. Analysts say although he has been retained as a technocrat, he is now a defeated election candidate and a presidential loyalist at the mercy of his boss. To make things worse, Mnangagwa has assigned his son to shadow Ncube.

 He will be forced to toe the line and listen to a deputy with no track record of financial engineering. His permanant secretary, George Guvamatanga, a seasoned banker, is a close ally of the President’s top advisor Kuda Tagwirei and Ncube.

This, according to critics, may render Ncube too powerless to rein in Tagwirei’s interests should they cost an arm and a leg for Treasury.

Critics say issues that need independepent policy will be difficult to implement. Leon Africa chief executive Tinashe Murapata says Ncube’s job is unenviable.

“The man we must feel sorry for is Professor Mthuli, the new Minister of Finance and Investment promotion. Given a larger portfolio, yet a lame duck,” Murapata said.

“He is expected to pass all knowledge to his apprentice, yet make no decision of his own. Everything that happens at Treasury, especially the closed-door meetings, will have a direct participant that reports back to the President.

“The President made a snide remark during the election period, about local professors who can’t cook their own local mopani worm delicacy. Many interpretations were given, but I believe it only revealed the policy tensions between Treasury and the President.”

 With limited latitude to appoint just seven non-elected ministers, the odds of landing a non-constituency cabinet slot appeared daunting to many.

 But for some ministers such as Zimbabwe’s top diplomat Frederick Shava, retaining his portfolio was almost certain.

After forming his first cabinet following the ouster of the long-serving former president Robert Mugabe, Mnangagwa handpicked a few “technocrats” to help him govern.

Former Mimosa Mining Company chief executive and past Chamber of Mines of Zimbabwe president Winstone Chitando was tasked with leading the Mines ministry.

Olympic gold medalist Kirsty Coventry took charge of the Sports portfolio while Cambridge University-trained economist Ncube was trusted with the national purse.

Amon Murwira, a full professor in aerospace earth observation, satellite remote sensing, geographic information science and global satellite navigation systems (GNSS), unmanned aerial vehicle (drone technology) applications and geospatial intelligence took oath of office to run the Higher and Tertiary Education ministry. Fast forward to 2023 election.

Chitando and Ncube threw their hats into the ring, hoping to shake off the unelected minister’s tag. It paid off for Chitando after he narrowly beat veteran journalist Mathew Takaona for the Gutu seat.

 The same cannot be said for Ncube. After investing enormous resources, time and energy to win the hearts and minds of Cowdray Park residents, he lost.

Critics say Ncube made a tactical error by contesting in a traditional opposition stronghold, the City of Bulawayo, instead of opting for a rural constituency.

Now with the election gone despite calls challenging Mnangagwa’s legitimacy, Ncube, who has faced turbulence since his appointment, can expect more battles ahead.

 Being one of Mnangagwa’s blue-eyed boys, Ncube essentially retained his Treasury role albeit with a bit of tweaking to it. Before the polls, his ministry was officially known as Finance and Economic Development.

Mnangagwa has since changed it to Finance and Investment Promotion. Judging by past United Nations Conference on Trade and Development (Unctad) statistics, Zimbabwe has a long way to go in catching up with regional peers in attracting foreign direct investment.

A few months before the 23 August general elections, Ncube announced fiscal and monetary policy measures to save the Zimbabwe dollar from collapse, raising eyebrows over Treasury’s overlapping roles on traditional central bank duties.

Among the measures, Treasury now funds the Zimbabwe dollar component of the 25% foreign currency surrendered by exporters, in order to eliminate the creation of additional money supply.

The foreign currency collected from the 25% that is surrendered will now be collected by Treasury and utilised in servicing the foreign currency loans assumed from the Reserve Bank of Zimbabwe. Banks will no longer withhold any foreign currency surrendered by exporters, and all the liabilities to the banks will be settled through Treasury.

 Economists and market watchers say Ncube should focus on few important things to make Zimbabwe restore its yesteryear glory.

Prosper Chitambara, a senior researcher at the Labour and Economic Development Research Institute of Zimbabwe, a think-tank of the Zimbabwe Congress of Trade Unions, said the head of Treasury should immediately focus on macro-economic stability, improving the investment climate, fiscal consolidation and taxation and an overhaul of state-owned enterprises.

 “We have faced macro-economic challenges for a long time, but over the past few months we have seen a bit of stability, but that stability must be sustained through both fiscal discipline and also monetary discipline,” Chitambara said.

 “Stability is paramount. I think now is the time to roll our sleeves and begin in earnest to implement what we have agreed on, especially around governance and institutional reforms.”

 Tackling Zimbabwe’s debt is another is

due that Ncube will grapple with. Walking the talk on political reforms which are seen as an elephant in the living room when engaging with creditors and the international community is one hell of a test for Ncube.

“The President feels ambushed by the debt arrears clearance and restructure,” Murapata contends.

“Treasury dalliance with African Development Bank president Akinwumi Adesina and former Mozambique president Joaquim Chissano saw very scathing remarks from the gentlemen on economic and governance issues. The President does not like to be openly embarrassed or criticised. The chemistry between Mnangagwa and Chissano was weak to non-existent. Adesina, with his orthodox economics and dandy attire, would be equally off putting.

“Treasury debt report missed the all-important narrative of a growing economy. In fact, it showed a declining economy in trouble. ZimStat’s blended inflation makes no sense, least to a professor of mathematical finance. But this was done to assuage the principal. The President rewards mythmaking.”

A few months before the elections, Mnangagwa said he preferred the mono-currency system to the current monetary system where the dollar now constitutes nearly 80% of all transactions.

 Ncube as an economist would not want this, fearing the worst could happen. But he has to toe the party line and sing the tune of ultra-nationalism.

“In February 2019, the Government of Zimbabwe introduced a local currency as a mono-currency. They had a clean slate to manage the monetary affairs of the country,” Murapata said.

“Within three years, the new currency had lost 99% of its value. Today it dithers, known for breaking world records as worst performing currency. Yet today, GOZ believes it can go it alone and restart the 2019 experiment of a new currency. Why should anyone believe that this time it will be different? Why is GOZ hell bent on this trodden road?”

To demonstrate Ncube’s losing influence, a few months before the elections, Mnangagwa blocked his proposal for a 10% tax on mining exports to pay arrears on the country’s debt overhang — which makes it difficult for the government to borrow more money — fearing that it might lead to a sudden dwindling of exports and the resultant revenue decline.

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