Zimbabwe’s Reserve Bank Governor said on Saturday he is not opposed to President Robert Mugabe’s controversial price controls that have wreaked havoc on the country’s battered economy.
But in his interview with the official Herald daily, Gideon Gono repeated his call for measures to be taken to stabilise prices in the country’s hyper-inflationary environment without damaging production.
”It is important that the nation realises that apart from attending to consumers’ plight, there is need to attend to the production plight, what we call the supply side, to avoid the emptying of shops without replacements the next day,” he said.
Gono’s comments came after reports in independent newspapers in Zimbabwe and in the Mail & Guardian on Friday said he was against the government’s two-week old campaign to force businesses to reduce prices, sometimes by more than half.
The papers said he had taken the unprecedented step of criticising the governments policy in a 59-page policy advice document to the government.
The blitz on high prices by police and state agents has so far seen the arrest of more than 2 000 business executives and shop owners for overcharging.
Independent economists have condemned it as putting the final nail in the coffin of Zimbabwe’s economy, which is reeling under inflation of more than 4 500%.
Already shops have run out of basics such as sugar, meat, cooking oil and flour, while fuel stations have run dry and there are long queues for bread. Retailers say they cannot afford to replace stock that has been sold at a loss.
However, Gono on Saturday criticised the country’s business sector for raising prices on a daily or hourly basis before the government imposed its price controls.
”That madness needed to be dealt with decisively,” he told the Herald. ”The lesson business must learn from the current blitz is that no business can ever thrive and make a profit in an environment of antagonism with the government.”
But he also had words of advice for the government. ”No government can hope to fulfil the aspirations of its citizens, especially labour, civil society and the generality of the populace, in an environment of serious conflict such as it has with its business community,” he said.
Independent papers reported on Friday that hawkish ministers in Mugabe’s government were not amused by Gono’s criticism of the price controls, and wanted the governor cut down to size.
But in Saturday’s interview, Gono hastened to add that ministers in the government were his seniors, whom he said he was privileged to advise.
”I have the privilege to advise them individually or as committees or taskforces, and when that advice differs from the conventional, it should not be viewed as adversarial,” Gono said. — Sapa-dpa