Biti claimed that the worsening situation showed Mnangagwa’s government has no clue of how to navigate out of the deepening crisis.
The former Finance minister during the inclusive government also suggested the disbandment of the central bank, claiming it was at the centre of the economic crisis through failed currency reforms.
Addressing a residents’ feedback meeting in Harare’s Pomona area on Monday, Biti said the Zanu-PF government has no option, but to come to the negotiating table with the opposition to mitigate the situation.
“I hope that they will find wisdom to open dialogue with the MDC because if they don’t do that, we are heading for another implosion and implosion in the form of a military coup or implosion in the form of people demonstrating because they have no option of being killed again as happened in August 2018 or in January 2019, so we need dialogue to create a soft landing,” he said.
Biti said people have become too desperate and have normalised the abnormal.
The Harare East legislator said there was rampant corruption and State capture happening in the country’s public entities, thereby contributing to the nation’s woes.
He spoke of deep-rooted corruption in the fuel sector and accused senior Zanu-PF officials of not paying for electricity, hence the huge debt that has crippled Zimbabwe, resulting in long hours of load-shedding.
“We are in the middle of a recession right now, one that is fast-tracking itself into an economic depression,” Biti said.
He said this would be so because of the deteriorating electricity situation, massive agricultural contraction and the shortage of foreign currency to keep businesses running.
The former Finance minister warned that the country was on the verge of sliding back into the 2008 hyperinflationary era.
“The economy is going to contract massively and the last time we had this massive contraction was in 2008, when our economy shrunk by minus 14% and this time around, it is going to be minus 8,5%,” Biti said.
“But what should worry you and me is that those that are in authority at the present moment have no clue of what they are doing. There is nothing as dangerous as a man who is lost and who doesn’t know that he is lost. That man is dangerous because you cannot ask for directions and regrettably, that is the challenge of the present government.”
The Harare East MP said government’s currency reforms had robbed people of their earnings and were causing misery to the citizens, something that must not be allowed in a normal country.
He also accused the central bank of being complicit in eroding people’s earnings through the monetary reforms, adding that pensioners have lost everything to the hyperinflation era of 2008-9, the bond notes era and now the re-introduction of the local currency.
Without proper economic fundamentals in place, the new currency would not work, Biti charged, indicating that: “We need to have productivity; we need to deal with a raft of infrastructure on superstructure measures, the first one being the monetary policy.
“I have never seen such confusion such as the monetary policy of this country and I have said this and I want to say it again, I don’t think we need a central bank. The central bank has been at the epicentre of all the economic destructions that this country has seen.”
The country is reeling under the rising cost of living and workers, including civil servants, are up in arms with their employers seeking salary increments.
Also yesterday in Parliament, Biti accused his successor Patrick Chinamasa of unleashing deficit financing, which resulted in the country incurring huge debts.
Contributing to a heated debate in the National Assembly on a motion introduced by Wedza North MP David Musabayana (Zanu-PF) on the introduction of the Zimbabwean dollar, Biti said as Finance minister, the Government of National Unity (GNU) left US$6,5 billion in the central bank and people were free to withdraw their money from their banks.
“When we were in the GNU, we left physically US$6,5 billion and any Zimbabwean was free to go to an ATM to withdraw money, but the problem happened in the form of Chinamasa, who unleashed a fiscal policy to do with deficit financing and the budget deficit grew, and now we have a huge domestic debt, which is a product of Chinamasa,” he said.
Biti said it was unbelievable that Zimbabwe’s economy had two bouts of inflation and yet it was a country which was not at war.
Noting that the only country that went through two bouts of inflation was Germany during the two world wars, Biti added: “In May, before the introduction of SI 142 (2019), our inflation was at 76%, but in June, it was at 175%, and the simple economics that bread was $1,20 and it is now $7,20 shows that our inflation is now at 700%.”
He believes that the only economic fundamentals that should have guided the introduction of the Zimbabwe dollar were production and jobs.
Biti further alleged the Zimdollar had become an instrument of arbitrage, adding that the opposition was vehemently opposed to its re-introduction.
While introducing the motion, Musabayana, however, hailed the re-introduction of the Zimbabwe dollar saying the only way to counter US sanctions was for the country to have its own currency.
University of Zimbabwe (UZ) political science lecturer Eldred Masunungure said in the past 20 years, Zimbabweans had exhibited a legendary resilience which has forced them to accept the abnormal situation.
“Zimbabwe should have exploded a long time back and the mystery is why it has taken so long,” Masunungure said.
“We have had this in the past 20 years, but the Zimbabwean situation is not a normal one. There is a high threshold of resilience and until that endurance reaches exhaustion point, it is at that point when this social and political situation will implode. We have had many episodes of economic implosion which have led to that.”
The UZ political science lecturer pointed out that if it was in other countries such as South Africa, people might have taken to the streets a long time ago.