Below is Hon Tendai Biti’s presentation on Twitter:
The regime has announced a potpourri of contradictory, self-defeating, punitive & vindictive measures with the intended aim of stopping or reversing the dramatic & rambunctious free fall of the Zimbabwean $ &the consequential inflationary spike experienced in the last two weeks.
Truth is the measures are I’ll think & reflective of a paranoid moribund incompetent regime that believes everything & everyone is an enemy & a saboteurs regime that blames everyone except itself for the humongous mess it has plunged Zim into a regime that sees shadows everywhere
The dramatic fall of the exchange rate stems from the introduction of the Zim$ when the necessary preconditions were absent. It stems from a huge mismatch between supply & demand. It stems from the failure of the Dutch auction system. It stems from a huge budget deficit monetized through the printing of money.
It stems from corruption & the billions of Zim$ being pummeled into the system from illegal deals Given this only full & unmitigated re-dollarization provides a short term solution. Anything else, including the regime’s new measure, is an absolute joke and a sheer worst of time.
Policymaking must never be allowed to be anecdotal or a product of beer hall diatribe. The new measures smack of that.
Broad sweeping statements & conclusions are made without evidence & data. Major decisions are made without analysing the legalities of the measures or their consequences on the macro or micro level.
We have always argued that this is the worst government in the history of governments & the latest measures prove that.
The key points of the new measures are as follows a) continuation of the Dutch auction system. b)Suspension of all lending by Banks. c) Suspension of major services by stockbrokers. d) Increase in Capital Gains to 40% from 20 % on shares sold in less than 270 days e) 2 % levy on US$ cash withdrawals above a $1000. f) Increase in IMMT tax on US$ transactions to 4 % & 2% on Zim $ g) Retailers & businesses allowed to charge in US$ on a willing buyer willing seller exchange rate regime. h) US$ taxes to the government now to be paid on the willing buyer willing seller exchange rate regime.
We now await the legal instruments necessary to effect the above measures. Save to say that massive litigation is inevitable. For instance, it is blatantly unlawful to ban banks from lending when it is their core business. The new taxes & proposed civil penalties are unlawful.
The truth of the matter is that Zimbabwe deserves better. It deserves new leadership. Sure, #NgaapindeHakeMukomana