Every Zimbabwean is a forex criminal, govt, magistrates and judges included

The public must not be confused by government’s renewed anti-business sabre rattling, it is just politics. Government knows, as do schoolchildren, that the exchange rate is not 88.55 as purported by its most recent charade at the foreign currency auction.

This truth is also apparent to magistrates and judges that also make use of parallel market rates in their personal dealings. There are no exceptions, we are all criminals if getting market value is unlawful.

Indeed, it came as little surprise to the public when it emerged that the police were using the parallel market exchange rate of 160 to dispose of goods at auction.

Clearly, in addition to schoolchildren, even the police know that the exchange rate is not 88.55.

Government itself also understands this exchange rate reality. This will be confirmed by its maize producer price announcement. Invariably, this will be pegged using the supposedly illegal black-market rate to match prevailing commodity prices.

Yet yesterday, the finance minister was punching furiously against the indexing of Zimdollar prices using parallel market rates. A self-congratulatory treasury statement issued yesterday warned that offenders will soon be dealt with:

“… government has also improved access to foreign currency by all bona fide businesses and individuals through the auction system …. However, a residual core foreign currency demand, fuelled mainly by speculative, and store of value demand for currency on one hand as well as criminal and money laundering activities on the other, has perpetuated and sustained the parallel market for foreign currency.”

As Professor Mthuli Ncube put his signature to this dishonest statement, which is completely disconnected from reality, he appears to have forgotten that virtually all fuel in the country is sold in United States dollars. Is every motorist in the country also getting foreign currency from the auction system? Are those motorists also ‘perpetuating and sustaining’ the parallel market?

By some act of perverse magic, Ncube appears to have persuaded cabinet that he is somehow running a rational operation in which [1] fuel is sold to the public in foreign currency but [2] that foreign currency is not available in the banks. Meanwhile, [3] it is also illegal buy foreign currency from dealers and at the same time [4] some of the biggest businesses in the country are openly using the parallel market rate.

The contradictions are violent and demonstrate the extent to which Zimbabwe has fallen as a thinking society. We are now defined by force and violence; ideas hold no sway.

Ncube added yesterday: ”Recently, the central bank, working closely with the Financial Intelligence Unit have begun a process of identifying and prosecuting perpetrators of parallel market activities.”

There is no need for any investigation. Simbisa Brands has been pegging its prices against parallel (read actual) market rates for a very long time. It is the biggest fast-food chain in the country (Chicken Inn, Pizza Inn, Bakers Inn, Steers, Nandos and 11 others) and is certainly not operating clandestinely. Indeed, this is how all legitimate businesses are operating.

Government has allowed this to happen because it knows that Simbisa would have no option but to increase US dollar prices if it was forced to accept uneconomic auction rates. There is no business that will trade at a loss just to make the finance minister feel better about himself.

The recent arrest of small fish directors accused ‘sabotaging the economy’ is nothing more than political theatre to shift blame away from government’s irresponsible monetary policies. Remember when the same government used to insist the rate was 1:1?

Yet one gets the feeling that the authorities may actually believe they can bark the exchange rate back to order, in the same way that they have subjugated the population through violence and intimidation.

Indeed, this was the message from vice president Constantino Chiwenga who recently warned that those accused of sabotaging the economy, by dealing in foreign currency, would be spending Christmas behind bars even if they hired the best lawyers.

The VP, perhaps also under Ncube’s influence, appeared to genuinely believe that the exchange rate was moving, not in response to monetary policy, but to someone sitting in an office arbitrarily musing: “what should the exchange rate be tomorrow?”.

If you can believe that, you can believe anything.

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