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Concerns are still being raised over what Confederation of Zimbabwe Retailers (CZR) president Denford Mutashu recently described as speculative pricing in some circles, despite the static foreign exchange rate, which is set by importers not by the authorities, and the low and falling monthly inflation rates.
Market fundamentals set the exchange rate, not manoeuvring by the Reserve Bank of Zimbabwe (RBZ) or Government contribute to the static rates on both the foreign currency auctions and the blackmarket.
Government now has a new normal, that it lives off its tax receipts and even manages to ensure that half of these receipts are available for its “services”, things like the development it is financing and the devolution funds it is managing to transfer to local authorities to fix infrastructure and cope with new expectations.
This primary budget surplus has allowed the Government to start intelligent interventions into social payment systems, ensuring that those on the very base of the ladder get enough money to survive, some of that money being new funds and some being a reassignment of former subsidies, that benefited the rich and poor alike, to benefiting just the poor.
Even with the politically tricky subject of civil service pay rises, the Government has been firm on the maximum it can go without breaking the fiscal discipline, but on the other hand, has been willing to keep pushing up pay scales and benefits by going to that maximum.
It has not been trying to cheat its employees. When revenues rise, civil servants get their share.
This building of trust has seen most in the public health sector, with almost all doctors and nurses who were involved in various degrees of industrial action now back in full-time duties.
Part of that process, and one that must be welcomed, has been the active intervention by chief executives of hospitals, who have been clearly explaining to their staff what the positions are as well, we assume, making it equally clear that they will continue to battle for their own staff welfare.
This sort of team building, plus the active and long awaited upgrade in the actual facilities and equipment in hospitals, thanks to more capital investment and the intervention of local and foreign donors brought about by the Covid-19 pandemic, has helped.
We also assume the anti-corruption drive at NatPharm has had its effect, with funds for medicine and consumables now being spent on that rather than lining assorted pockets, that must have improved morale.
But we also need to look at the other major change we have seen in Government policy, the funding of inputs.
As Agritex officers have been pointing out, the new system automatically excludes the dishonest by requiring a physical examination of land preparations before inputs can be accessed.
But at the same time these senior officers have not been afraid to expose shortcomings, such as the Grain Marketing Board having one delivery truck in the Midlands.
Again, we are seeing senior civil servants fighting for their staff and their clients, with expectations that improvements are now possible. So we have improving morale, the deliberate creation of team spirit rather than “us and them” and signs of relief all round that the corrupt and dishonest are being dealt with.
Corruption is like a cancer, rotting the healthy parts of the body politic, as the honest just give up, as well as its direct damage of missing funds.
At the Reserve Bank of Zimbabwe, the emphasis has been on monetary policy rectitude, the sort of things that central banks are supposed to do.
The RBZ, backed where necessary by Government when legislation or enforcement is required, has been concentrating on monitoring things like liquidity, transparency of transactions and making doing honest business a lot easier while hampering dishonest business.
So we had the anonymous transfers and slackness in the mobile money system fixed, and despite the wailing from some providers and now unsuccessful attempts to get round the new discipline a new attitude towards doing business plus the interesting discovery that intelligent regulation does not harm profits.
In fact a stable economic environment makes those profits real, rather than paper numbers, and access to foreign currency auctions makes it easy for providers to buy the spares and new equipment they need.
One intervention that became obvious this week is that the RBZ is keeping its gaze on what is called reserve money, that portion of the money supply that is available for spending and is not tied up.
Here it has been active, as it is supposed to be, and is willing to drain that pool a few centimetres when required.
That intervention does not harm importers with cash to buy at the auction, but it does make it harder for those who fancy borrowing and speculating to corner a market.
And draining more than $2,5 billion from the accounts of importers every auction forces those same importers to think seriously about how they run their businesses so the account refills in time for the next auction.
Even the black market has been mirroring the stability in the auction and bank markets.
Rates have been totally stable for several months now, partly because of controls on liquidity and partly because almost all legitimate businesses can now buy their foreign currency lawfully and easily at auction.
While raw materials and machinery dominate the big-business auction, as could be expected, it is noticeable that “consumables”, spare parts, tyres and the like, are always the largest item at the SME auctions.
This can only mean that swathe of modest companies that are responsible for maintaining, fixing and servicing vehicles, plant and equipment across the productive sectors have abandoned the runners and are now importing legally and directly.
And this is why the speculative pricing, the honest retailers are complaining about is no longer good business, but just profiteering.
The excuses no longer wash. But those hit by speculative pricing have an option: they can look for new suppliers who work in the new normal world and, if necessary, help set up those new suppliers.
There are plenty of talented Zimbabweans moving into business who just need a chance, and if they offer good service at fair prices they need to be supported. Competition can wipe out the dishonest and speculators.
Online Reporter