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#AntiDollarisation Thread 
1/ Calls 4 dollarisation are symptomatic of very poor economic arguments by those who are hostile 2 business&the market system.
This is the mainstream economic thinking in ZW thru socialisation of the education system that is #statist.
1/ Calls 4 dollarisation are symptomatic of very poor economic arguments by those who are hostile 2 business&the market system.
This is the mainstream economic thinking in ZW thru socialisation of the education system that is #statist.
2/ The calls are against a background of these Top #EconomicProblems
1. Rising inflation creating price instability&lack of confidence in the local currency (LX),
2. Fast depreciating exchange rate leading 2 an erosion of time value of money affecting the purchasing power,
1. Rising inflation creating price instability&lack of confidence in the local currency (LX), 2. Fast depreciating exchange rate leading 2 an erosion of time value of money affecting the purchasing power,
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3. Low FX generating capacity,
4. Dwindling disposable incomes affecting aggregate demand. This consequently affects productivity. An economy of low productivity & aggregate demand contracts further rather than grow,
3. Low FX generating capacity,4. Dwindling disposable incomes affecting aggregate demand. This consequently affects productivity. An economy of low productivity & aggregate demand contracts further rather than grow,
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5. Lack of respect of property rights, examples FX surrender & forced liquidation requirements, & the #ReconAct.
6. Lack of fiscal prudence by way of wastefulness, inefficiencies, arbitrage opportunities thru paying for fuel, grain&electricity, & abuse of public office,
5. Lack of respect of property rights, examples FX surrender & forced liquidation requirements, & the #ReconAct.6. Lack of fiscal prudence by way of wastefulness, inefficiencies, arbitrage opportunities thru paying for fuel, grain&electricity, & abuse of public office,
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7. Shockingly lack of consequences over fraudulent, inefficient & wasteful spending in Ministries & SoEs as identified by the Auditor General.
7. Shockingly lack of consequences over fraudulent, inefficient & wasteful spending in Ministries & SoEs as identified by the Auditor General.
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Direct consequences
1. LX is unstable & fast losing value due 2 the movement of the exchange rate.
2. There is demand 4 FX bcoz people are running away from the unstable LX.
Direct consequences
1. LX is unstable & fast losing value due 2 the movement of the exchange rate. 2. There is demand 4 FX bcoz people are running away from the unstable LX.
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3. High demand for FX is both for store of value&transaction.
4. The biggest appetite for FX is coming from Gvt by way of its profligacy&imprudence: arbitrage opportunities by spending on what it shouldn’t, wastefulness, abuse of public office & lack of accountability.
3. High demand for FX is both for store of value&transaction.4. The biggest appetite for FX is coming from Gvt by way of its profligacy&imprudence: arbitrage opportunities by spending on what it shouldn’t, wastefulness, abuse of public office & lack of accountability.
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5. The next big demand for FX is from retail importers ( @theczr & @ZNCCNational) bcoz industry ( @czionline) productive capacity is less than 35%.
5. The next big demand for FX is from retail importers ( @theczr & @ZNCCNational) bcoz industry ( @czionline) productive capacity is less than 35%.
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#EconomicSolutions
1. Cut demand of FX from Gvt: stop expropriating FX from exporters, stop paying for fuel&grain, avoid baby sitting business, stop arbitrage opportunities, exercise fiscal prudence, avoid wastefulness, & hold public officers accountable.
#EconomicSolutions
1. Cut demand of FX from Gvt: stop expropriating FX from exporters, stop paying for fuel&grain, avoid baby sitting business, stop arbitrage opportunities, exercise fiscal prudence, avoid wastefulness, & hold public officers accountable.
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2. Respect property rights: any FX in an economy belongs 2 exporters & a non-exporter gets it by buying in the open market or borrowing it & not robbing (expropriation&forcibly liquidation).
@ZEPARU1 @MhonaFelix @zimeconomics @mutungadzimwe @kudzie_sharara @baba_nyenyedzi
2. Respect property rights: any FX in an economy belongs 2 exporters & a non-exporter gets it by buying in the open market or borrowing it & not robbing (expropriation&forcibly liquidation).@ZEPARU1 @MhonaFelix @zimeconomics @mutungadzimwe @kudzie_sharara @baba_nyenyedzi
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3. Boost investment for a robust productive capacity of local industries to cut down on the retailers’ import bill & incentivize exports to fund industrial inputs, machinery & technology.
@ZimTreasury @BusinessTimesZW @newswireZW @kukurigoZW @happ_zenge @brains_muchemwa
3. Boost investment for a robust productive capacity of local industries to cut down on the retailers’ import bill & incentivize exports to fund industrial inputs, machinery & technology. @ZimTreasury @BusinessTimesZW @newswireZW @kukurigoZW @happ_zenge @brains_muchemwa
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The local currency has 2 be stable & supported by 3 pillars:
1. Productive capacity 4 exports 2 produce as much FX as possible;
2. Productive capacity 4 the domestic market 2 reduce the import bill, &
3. Fiscal prudence 4 accountability & public sector efficiency.
The local currency has 2 be stable & supported by 3 pillars:1. Productive capacity 4 exports 2 produce as much FX as possible; 2. Productive capacity 4 the domestic market 2 reduce the import bill, & 3. Fiscal prudence 4 accountability & public sector efficiency.
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For non-exporting entities 2 have FX in their possession, they need 2 buy it from the open market, borrow from or rob it from the FX producers.
FX is ONLY produced by those who export: manufacturers, tobacco&cotton companies & miners.
Dollarisation doesnt produce FX!
For non-exporting entities 2 have FX in their possession, they need 2 buy it from the open market, borrow from or rob it from the FX producers. FX is ONLY produced by those who export: manufacturers, tobacco&cotton companies & miners.
Dollarisation doesnt produce FX!
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@ZANUPF_Official: respects LX on grounds of sovereignty but disrespects it thru hyper inflationary financial imprudence&profligacy.
@mdczimbabwe: disrespects local currency by way of dollarisation but lacks initiatives 4 FX supply side&domestic production.
@APAZimbabwe?
@ZANUPF_Official: respects LX on grounds of sovereignty but disrespects it thru hyper inflationary financial imprudence&profligacy. @mdczimbabwe: disrespects local currency by way of dollarisation but lacks initiatives 4 FX supply side&domestic production.@APAZimbabwe?
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#SupplySide Policies:
SMART export promotion&incentives,
removal of RBZ expropriation&liquidation requirements,
acquittal of exports (CD1 Form) within 90days,
open mrkt pricing&buying of forex, &
removal of arbitrage enhancers like paying/LCs 4 fuel&grain by RBZ
#SupplySide Policies:
SMART export promotion&incentives, removal of RBZ expropriation&liquidation requirements, acquittal of exports (CD1 Form) within 90days,open mrkt pricing&buying of forex, &removal of arbitrage enhancers like paying/LCs 4 fuel&grain by RBZ
16/ Dollarisation doesn’t improve the supply side of forex 2 stabilize the exchange rate.
Instead its a robbery of exporters bcoz they would not have been paid for it at an open market.
@BrezhMalaba @Faye_Zaba @kmugova @PaulNyakazeya
Instead its a robbery of exporters bcoz they would not have been paid for it at an open market.
@BrezhMalaba @Faye_Zaba @kmugova @PaulNyakazeya
17/ If the exchange rate stabilizes, the LX will automatically stabilise. Prices&earnings can be pegged or rated in USD & paid in LX. There wont be need for the domestic market to demand for FX.
@TrevorNcube @JoeMutizwa @MthuliNcube @ReserveBankZIM @PriscaMutema2
If the exchange rate stabilizes, the LX will automatically stabilise. Prices&earnings can be pegged or rated in USD & paid in LX. There wont be need for the domestic market to demand for FX. @TrevorNcube @JoeMutizwa @MthuliNcube @ReserveBankZIM @PriscaMutema2
18/ Prudential policy interventions:
Credibility: sound&consistent polices,
Confidence: assurance of continuity 2 stimulate trust&ready willingness 2 invest in skills&technology,&
Competitiveness: incentives 2 enhance productive capabilities&invest in new capacities.
Credibility: sound&consistent polices,Confidence: assurance of continuity 2 stimulate trust&ready willingness 2 invest in skills&technology,&Competitiveness: incentives 2 enhance productive capabilities&invest in new capacities.
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It’s economically shallow if not ignorant 2 call for dollarisation using FX you don’t have, you arent producing&that has been robbed from exporters.
The demand for dollarisation is being advocated by people who are hostile 2 business, property rights & the market system.
It’s economically shallow if not ignorant 2 call for dollarisation using FX you don’t have, you arent producing&that has been robbed from exporters. The demand for dollarisation is being advocated by people who are hostile 2 business, property rights & the market system.
