ANALYSIS | It wasn’t me: Of Shaggy and the men in charge of the Zimbabwe dollar

Under scrutiny: Finance Minister Mthuli Ncube with permanent secretary George Guvamatanga and RBZ governor John Mangudya

As far as Shaggy was concerned, his buddy RikRok had no reason to take responsibility when his honey came in and caught him red-handed creeping with the girl next door. His advice was simple; just tell her “It wasn’t me”.

For central bank governor John Mangudya and Finance Minister Mthuli Ncube, when explaining the collapse of the currency, the strategy of choice has been clear. Blame everyone else. And, even when your own data shows you lost control of money supply growth – the monetary policy equivalent of being caught red-handed like RikRok – use the Shaggy strategy; “it wasn’t me. It was someone else. Your eyes deceived you”. Recently, Mangudya has blamed “behavioural issues” and Ncube has blamed “speculators.

On Tuesday, President Emmerson Mnangagwa said his government is planning a new set of “currency reforms” to try and save the Zimbabwe dollar, which has lost over 90% of its value since last year and is now used by only a fraction of the economy. This will be only the latest in a string of attempts over the past five years to stabilise the currency. Through those attempts, authorities have taken no responsibility. It has always been someone else. Here, we look at a list of just some of those blamed for the currency woe over recent years.

It wasn’t me. It was EcoCash

In 2020, as the Zimdollar crashed to Z$100 against the USD – oh for the good old days – the government blamed mobile money. EcoCash “is the centre pivot of this problem and its resultant impact on Zimbabwe’s economy”, the government said in a statement, released late on a Friday night. EcoCash directors were charged, and RBZ questioned their “suitability to hold prominent positions in a financial institution the size of EcoCash or for that matter any regulated financial institution”.

Mobile money was suspended to allow “intrusive investigations”, disrupting commerce. EcoCash at the time controlled 98% of the mobile money market.

It was the stock market

As inflation rose, people bought shares to preserve value. Government refused to see this as a symptom, or a rational response to inflation. They shut down the Zimbabwe Stock Exchange for a month.

It was Old Mutual and PPC

In 2020, the government said the “fungibility” of Old Mutual, Seed Co and PPC shares – which allowed buyers to transfer shares between the ZSE and foreign markets – was behind the Zimdollar’s collapse. They closed that channel. Government then blamed the currency crash on the Old Mutual Implied Rate (OMIR), an unofficial exchange some people got by comparing Old Mutual’s share price in Zimbabwe and South Africa. Old Mutual had no role whatsoever in that rate. Later, Mthuli said “there was no observed evidence of the direct involvement of the listed entities themselves”. Old Mutual shares remain suspended, almost four years later.

It’s that fancy ETF

In 2021, ZANU-PF’s Chris Mutsvangwa called the exchange traded fund (ETF), first launched in Zimbabwe by Old Mutual, “a financial weapon of monetary terrorism”. He urged Mthuli to ban this “fancy ETF derivative”. Not long after this, it turned out Mutsvangwa was – big surprise – among the top 20 holders of another similar fund, the Morgan & Co ETF.

It was those greedy banks

In May 2022, on a Sunday evening, President Mnangagwa announced from State House; banks should stop lending. They were conduits for criminals borrowing at low interest rates and trading in forex. The ban lasted just over a week, but the damage has lingered to this day.

It was those contractors

Contractors paid for infrastructure projects did the inevitable; they hedged themselves by inflating Zimdollar invoices and buying US dollars as soon as the bank notification hit. Treasury Permanent Secretary George Guvamatanga blamed them for “instability in the foreign exchange market characterised by unnecessary movements on the rate resulting in exorbitant prices being charged”. He blacklisted some of them.

It was those shadowy political forces

At one time, as the Zimdollar went on one of its dives, Mnangagwa told the Politburo: “This is a battle being fuelled by our political detractors, elite opportunists and malcontents who are bent on pushing a nefarious agenda.” Fretting, the ruling party summoned Mthuli Ncube John Mangudya to explain the crisis. After the meeting, Patrick Chinamasa, a former finance minister himself, had a list of culprits. He said “there is an invisible hand at play fomenting regime change.”

The Shaggy strategy

As the Government now plans its currency strategy, you can count on one thing. Nobody is bringing a mirror to the strategy session. Instead, everyone is reciting Shaggy.

But we saw you increase reserve money by 307% in the months after you reintroduced our ZWL in 2019. And, and, just last year, we saw you increase money supply by 130% from June to November: “It wasn’t me!”

But we saw you refusing to promote Zimdollar usage yourself, choosing to charge USD for government services: “It wasn’t me?”

At that point, hopefully, someone in the room will sigh and, like RikRok tells Shaggy towards the end of the song, tells the officials: “I’ve been listening to your reasonin’. It makes no sense at all.”