Mthuli Ncube: Why I was at Zanu PF conference

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Pictures of Finance minister Mthuli Ncube at the just-ended Zanu PF conference held in Esigodini in Matabeleland South got Zimbabweans talking on social media.

It was the first time the Cambridge University-trained economist was seen at a high-profile Zanu PF event since he was roped into President Emmerson Mnangagwa’s post-election Cabinet as one of the technocrats expected to help turn around the comatose economy.

Ncube (MN) told our senior reporter Obey Manayiti (OM) in an exclusive interview that questions about why he attended the conference were personal, but said there were no prizes for guessing what he was.

Ncube also spoke about growing demands by civil servants to be paid in foreign currency and the impact of his raft of austerity measures introduced a couple of months ago. Below are excerpts from the interview.

OM: Did you attend this Zanu PF conference as a member and if so, when did you join?

MC: Do not ask me personal questions like that. I am a government official. I am the minister of Finance. I was appointed by a Zanu PF government. I think there are no prizes for guessing what I am.

OM: What do you consider to be the key outcomes of the conference considering that it took place on the back of the austerity measures you introduced a couple of months ago and the 2019 national budget presented last month?

MN: At this conference, the party endorsed the budget proposals and adopted them as their own, equally they endorsed the Transitional Stabilisation Programme (TSP) and also endorsed Vision 2030 because those three are interlinked.

They also urged us to follow the recommendations and make sure that they are implemented. That is very important and that is very pleasing. But there are a lot of overlaps within the other recommendations of the party with what we see in the budget, the TSP and Vision 2030 such as, for instance, making sure that we live within our means in a way that preserves value, making sure that we eventually resolve the currency issue and remove price distortions by making sure that we support the productive sector so as to support job creation.

That came out very strongly indeed and also making sure that those who are profiteering from the exorbitant prices are sufficiently sanctioned, including withdrawal of licences, which really is the last resort.

We shouldn’t get there and I think they must heed the call that they shouldn’t profiteer.

They should run their business competitively, all those things are enshrined in what we have been trying to do within the budget and within the announcements that we have made.

Also what is very clear is that other measures such as the 2% transaction tax are very key to supporting and financing devolution because really, half of what we have raised from that 2% stake is actually financing devolution.

That $310 million that I allocated in the budget and the other half is going towards supporting social services, education and health, making sure that there are no potholes on our roads.

So this is very important going forward. Everything that was discussed here at least on the economic front is supportive of what we are trying to do.

If you look at agriculture, for instance, supporting agriculture, raising productivity, making sure that inputs for farmers are available and making sure that there is the right price that will support farmers.

In terms of provision of health services, all that came out very strongly is that we need to do our best to make sure that the quality of service delivery is right there, protecting the vulnerable in terms of our social service efforts.

OM: In brief, you are saying you are happy with the outcome of the conference and you feel it will make your job easier?

MN: Absolutely, I am very pleased with what was deliberated on at this conference for the past two days, but also prior to that, in terms of the central committee and politburo, it is in line with Vision 2030, in line with Transitional Stabilisation Programme, in line with the budget.

So I am very happy indeed that we have had that alignment with what government is trying to do.

OM: When you announced the austerity measures, Zanu PF complained that you did not consult them. Have you managed to find each other in that regard?
MN: Absolutely, we are on the same path. We are on the same page and the resolutions are testimony to that.

All our policies were endorsed here, were adopted here and now the party is urging us to make sure that its members, the nation, the citizenry understand what these policies are.

It is our duty to now make sure that we explain to them in simple words, in simple messages to the people.

OM: What is your assessment of the impact so far of the measures you introduced in your maiden budget?

MC: There is no resistance, people are complying. Of course, any major change in policy that impacts people will cause a reaction because they are adjusting.

I don’t think there’s any major negative reaction. Of course, we are hearing people requesting even salaries in US dollars.

Of course, government doesn’t, as you know, produce US dollars, all we know is that the US dollars are allocated  at the central bank to productive sectors, to areas of need such as fuel, fertilisers  and so forth, so there is no question of government providing salaries in US dollars.

I urge the leadership of those unions, who are pushing their members in that direction to desist from misguiding their members into believing that government is able to give them salaries in US dollars.

Government does not produce US dollars in the first place.

I urge them to desist from misleading their members, it is not fair that the enlightened leadership misleads their gullible members in this way.

OM: The conference specifically urged you to look into the multi-currency system, which they said was not working. Do you have any immediate solutions in your mind?

MC: The policies we have put in place are what we have in mind because you need strong policies, consistent policies, policies that begin to achieve results.

Before you resolve the multi-currency system, if you look at what we have done at the moment, we have first of all recognised that we don’t have monetary policy, we have no currency of our own, but we have fiscal policy.

We are using fiscal policy to stabilise monetary and value issues.

So by managing the budget deficit and curtailing expenditure — notice that the premium that we observe on the currency side has stabilised. Have you noticed that?

It is because we have closed the tap on the fiscal side. So we recognise this and we should continue to constrain ourselves in terms of expenditure, live within our means.

We are slowly creating the right environment for currency reform.

When we are ready, we will announce what we are doing, but we are aware that the multi-currency pricing system is prejudicing people but also legally, we have been telling people that it is illegal to practice a multi-currency pricing system. But we know people are practising it.

In fact, at this conference people were saying that you must implement the law, enforce it to make sure that it does not happen.

Really, we do not have to come to this where every time it is the strong arm of the law that is kicking in.

We are doing our part making sure that policies build up consistently to achieve the right results and steps toward the ultimate currency reform.