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Monetary policy
Media Monitoring Project Zimbabwe (MMPZ)
Extracted from Weekly Media Update 2007-39
Monday October 1st - Sunday October 7th 2007
October 11, 2007

The government media failed to give holistic coverage of Reserve Bank Governor Gideon Gono's belated mid-term monetary policy review. The 64 reports they carried (ZBC [35] and government Press [29]) only emphasized the perceived benefits of the policy review while they suffocated or censored its shortcomings. Because of this lopsided presentation, several key issues arising from Gono's statement never received attention. For example, the prudence of the governor's intention to boost industrial and agricultural production by doling out money was never examined, especially its impact on the country's hyperinflation.

The source of the funding was not questioned either, and it was never viewed as another example of Gono's widely condemned quasi-fiscal activities. Neither did the government media reconcile the policy differences between his office and other government departments, including President Mugabe, on how to address the economic decline.

For instance, all ZBC evening bulletins (1/10) and official dailies (2/10) failed to rationalise President Mugabe's renewed threats to "seize" and "nationalise" businesses allegedly increasing prices of goods "unnecessarily" with Gono's disapproval of government's price freeze regime.

Similarly, the official media did not compare Gono's warning against government's planned takeover of private companies under the proposed indigenisation law, saying this would spell further disaster for the country's ailing economy, with the authorities' determination to ram it through. In fact, there was barely any coverage on a range of other important issues raised by Gono. These included his new policy on foreign currency accounts; the contradiction of offering foreign currency inducements to farmers for grain delivered to the GMB (a development that contradicts President Mugabe's previous declaration that the local currency would remain the only legal tender in the country); and plans to change the local currency yet again, among others.

The government media only selectively reported on Gono's understanding of the root causes of the economic distress. They merely amplified Gono blaming Western "sanctions" for the economic decline while ignoring the governor's admission of government's own culpability. The Chronicle (4/10) report: How sanctions punish masses exemplified this biased presentation. So did The Manica Post (5/10). The government weekly simply reproduced an excerpt of the monetary policy statement that detailed how the sanctions had allegedly hurt the economy in isolation of other stated factors. ZBC performed no better.

The closest it came to discussing the matter was in the context of Gono's endorsement of the report by SADC's executive secretary Tomaz Salamao on the country's economic crisis, which noted that it stemmed from sanctions, lack of balance of payments support, high budget deficit, pricing distortions and lack of respect for property rights, among other ills (ZTV 1/10, 6pm). Otherwise, the government media simply presented the monetary policy as the panacea to Zimbabwe's economic ills. This was reflected in the way they devoted several stories to highlighting various people and organisations, especially those directly earmarked to benefit from the monetary policy, praising the governor's office for offering concessionary funding to industry, raising the gold support price and daily cash withdrawal limits and others.

Although ZBC's sourcing pattern appeared fairly representative (Fig 1), it belied the broadcaster's one-sided approach to the subject.

Fig 1: Voice distribution on ZBC

There was no such façade of fair representation in the government Press' sourcing pattern, which mostly relied on the authorities to tell the story. See Fig 2.

Fig 2: Voice distribution in the government Press

Only the private media attempted to give a balanced presentation of the issue.

Although they generally depicted Gono's monetary plan as noble, they remained sceptical of the authorities' commitment to implement it, particularly in light of the apparent discord among themselves over the best way to rescue the economy.

For example, Zimdaily, ZimOnline and Zimbabwe Times (2/10) exposed some of these differences when they reported Gono as having "warned" government over how its planned empowerment law negated his turnaround strategy by hurting investor confidence, adding that it was particularly a "threat" to the stability of Zimbabwe's fragile banking sector.

The private media also reported the governor railing at price controls, saying the controlled price of alcohol was nurturing a nation of drunkards. In fact, Zimdaily (3/10) reported that Indigenisation and Empowerment Minister Paul Mangwana "stormed out" of the monetary policy presentation, saying it was in "bad taste as it attacked government". The next day, The Financial Gazette (4/10) quoted analyst Daniel Ndlela describing the policy contradictions as "emblematic of the confusion in government and loss of direction in policy". The private media also questioned the economic prudence of some of Gono's proposals. For instance, the Gazette, Zimbabwe Independent (5/10) and The Standard (7/10) described as inflationary the governor's decision to subsidise industry to facilitate a quick return in the supply of basic commodities in the aftermath of government's controversial price blitz, as this would force it to print money.

The Independent cited analysts saying the Reserve Bank had resumed its quasi-fiscal activities contrary to Gono's claims in January that he had abandoned them. It observed that the monetary policy "sounded more like a national budget where each government department gets a fund allocation" and wondered where government would get the money to fund all these sectors. These reports were part of 36 reports the private media (private electronic media [12] and private papers [24]) carried on the subject. These media's sourcing patterns are shown in Figs 3 and 4.

Fig 3: Voice distribution in the private electronic media

Even though the private Press' sourcing pattern was dominated by government voices, its coverage of the topic remained critical.

Fig 4: Voice distribution in the private Press

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