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Bank
chief out on a limb
Institute for War and Peace Reporting (IWPR)
Hativagone Mushonga (AR No. 138, 11-Oct-07)
October 11, 2007
http://iwpr.net/?p=acr&s=f&o=339794&apc_state=henfacr339792
For a senior Zimbabwean
official, the central bank governor Gideon Gono has become unusually
outspoken against the official line, condemning a new bill which
will see foreign-owned businesses taken over.
Some analysts argue that
as the economy continues to implode and the latest government policies
look more misguided than ever, the country's top banker is
looking for an exit route.
In the latest of several
outbursts, the Reserve Bank governor publicly attacked the government
for pushing the Indigenisation and Empowerment Bill through parliament.
The bill would force foreign-owned companies, including banks and
mines, to surrender 51 per cent of their shares to indigenous Zimbabweans.
The lower chamber passed
the law on September 26; the upper house or Senate approved it without
amendment the day after Gono made his comments, and the bill now
only needs President Robert Mugabe's assent to come into force.
In an October 1 report
on monetary policy, Gono warned, "We must avoid schemes that
create perceptions of instant gratification through grab, take and
run, and instead go into value-for-money, win-win types of acquisition.
He went on to suggest
that powerful members of the elite were backing the nationalisation
scheme so that they could profit from it personally, as many had
done from the seizure of white-owned farms. That policy, launched
in 2000, left many of the newly-appropriated farms in the hands
of the rich and powerful, even though it was advertised as a move
to help the poorest landless peasants.
"As monetary authorities,
we also call upon government to ensure that the empowerment drive
is not derailed by a few well connected cliques, some who are already
making the most noise in ostensible support of this initiative,
who would want to amass wealth for themselves in a starkly greedy
but irresponsible manner, whilst the intended majority remain with
nothing, as happened in the past with respect to other government
empowerment schemes," said Gono.
It was the second time
in less than three months that Gono lambasted a government policy.
The first was over a June decision to force traders to slash the
price of basic goods and foodstuffs, in hope that this restrain
the massive inflation rate. Gono predicted that the immediate effect
would be to empty the shops and slash production - and he
was soon proved right.
Gono has also been critical
of the continuing policy of land seizures, urging the government
to end the policy and stop extending cheap credit to the big-time
farmers and instead focus assistance on smallholders.
When Gono took over as
head of the Reserve Bank of Zimbabwe in December 2003, he famously
declared that "failure is not an option". Since then,
he has generally complied with Mugabe's vision of how to manage
an economy, but the most recent policy decisions have driven his
free-market tendencies out into the open.
Some observers believe
that there is more to his new-found dissenting voice than just principle,
and that he is now determined to leave the administration even if
he has to get himself fired.
Lovemore Madhuku,
who heads the National
Constitutional Assembly, an opposition-aligned group that lobbies
for a new, more democratic constitution, told IWPR that he believed
that Gono wanted to leave government while some of his reputation
was still intact, so that he could argue that he had done his best
to turn the economy around but had been prevented from doing so
by the ZANU-PF-led government.
"He is frustrated.
He is trying to find a way out; this could be by pushing to be fired
or being forced to resign," said Madhuku. "His initiatives
have not been working, and considering his statement that failure
was not an option, he wants out.
"He has not been
listened to. Decisions are made in the [ZANU-PF] Politburo, and
Mugabe is the author of those policies."
Madhuku predicted that
however keen Gono was to depart, "he will not be allowed to
do that until after the [2008 presidential and parliamentary] elections".
Although ZANU-PF presents
a monolithic face to the outside world, there are factions within
it that quietly oppose Mugabe's plans to stay on as president
after next March. A senior official in the faction of retired army
commander General Solomon Mujuru told IWPR that Gono had finally
realised it was time to go.
"He thought
he was going to be prime minister and now he knows that was a mere
dream," said the ZANU-PF official, who asked to remain anonymous.
"So what's better - him leaving as a governor who failed
and who presided over one of the worst economies? Or leaving with
some reputation and the impression that it was not his fault but
the fault of government policies which he opposed and advised against?"
However, the source added
that it was already too late, and Gono would have no future in a
post-Mugabe environment.
"I am sure he wants
to be remembered as a central bank governor who stood up to Mugabe,
the only one that dared criticise his policies in public without
fear. If he were going to have a political career, that would have
been his selling point. But unfortunately, he has made too many
enemies and knows that after Mugabe he will not have a place in
government," he said.
"The question now
is: how far will Gono go and how much more will he say in the next
few months before the elections? And how long will Mugabe tolerate
his criticism?"
Hativagone Mushonga is
the pseudonym of journalist in Zimbabwe
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