Mthuli Ncube’s day to forget

Zimbabwe’s new finance minister, Mthuli Ncube had a day to forget in front of the podium at a New York investors conference, getting several details wrong on key economic indicators in an address that has left many puzzled about his grasp of the economy he is superintending.

In a presentation that lasted just over 14 minutes, the minister said the Zimbabwe Stock Exchange’s cumulative return since March 2009 ZSE was 2,000 percent, much higher that the actual 600 percent.

Even for a renowned financial engineer, the variance cannot be easily reconciled.

According to the Zimbabwe National Statistics Agency data released last week Monday, the year-on-year inflation rate rose to 4,83 percent in August after gaining 0,54 percentage points from the July rate of 4,29 percent. Ncube said he was happy with Zimbabwe’s inflation which he said had just gone up to six percent, from 4 percent.

Its difficult to assume that the minister does not know that Zimbabwe this year achieved an all time high tobacco output of 250 million kg, because he told his audience that the production, at 25 million kg was a 40-year high.

According to the Chamber of Mines, Zimbabwe’s mineral revenue is projected to reach $2,5 billion this year up from $2,3 billion last year, about 85 percent of total export earnings, not 60 percent as the minister insinuated.

The Zimbabwe Investor Forum was held at last Friday and according to Ncube, was attended by government officials and select US investors which included Morgan Stanley; Merrill Lynch; Bank of America, and JP Morgan executives. It was organized and hosted by investment group, Exotix Capital on the sidelines of the ongoing UN General Assembly.

There are also question marks about how Ncube could confidently say Zimbabwe will be one of the fastest growing economies from 2019 onwards, averaging a growth rate of six percent per annum.  This projection is seen as overly ambitious given the challenges the country is facing.

But then, Ncube glossed over the crises at hand — cash shortages; foreign currency shortages along with the attendant black market and pricing shocks it induces; poor infrastructure and a less competitive local industry.
Or maybe he knows more than he is letting on. – The Source