Would bond notes present an opportunity for local businesses operating in Zimbabwe?

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There is a school of thought which say you need to create demand so that supply can increase. The Keynesian school of thought is precisely based on the assumption that demand create its own supply. The bond notes will create demand, prior demand was depressed because of the liquidity crises. There were a few buyers but now as more people get bond notes demand will increase. The introduction of bond notes will increase 

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Understanding Zimbabwe’s budget deficits, government debt and economic effects

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The policy that ‘we eat what we kill’ was made popular in Zimbabwe during the Global Political Agreement period when Tendai Biti was the Minister of Finance. This is a principle advocated for by balanced-budget proponents. On the contrary governments also run budget deficits I have dedicated this article to explain the concept of budget deficits. A budget deficit the amount by which public spending exceeds revenue over a particular period of time. The Zimbabwean government is currently running budget deficits. The harmful effects of running budget deficits include; crowding out of the private sector, high real rates of interest, low national savings, low economic growth rates, large current account deficits and inflation, among others. John Maynard Keynes holds that in times of severe economic shriveling in the private economy, it is tolerable for the government to go into debt and increase spending to compensate for the fall in consumer and other private sector expendit
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Public financial transparency and accountability of government revenues and expenditures in Zimbabwe

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Zimbabweans are familiar with budget statement presented by the Minister of Finance in the parliament every year but unfortunately the public has never received detailed financial statements after expenditure. Zimbabweans usually know the amount which is allocated to certain ministries such as health, education social welfare but the public has never received financial reports detailing how the money was used. The lack of financial reporting means that the public has no information to make the government accountable. Accountability has been viewed since time immemorial as a channel for ascertaining the use of power by an individual or an organization that has been entrusted with the task of performing prescribed tasks (Premchand 1999).  Kautilya wrote a manual on bureaucracy before the Christian age, he observed that human nature was disposed to acquire public money for private gain. He wrote: “Just as it is impossible not to taste honey or poison that one may find at the tip of o
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Should Zimbabwe adopt the Rand as official currency?

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Follow @ExpBusinessSA Dollarization is a situation where a country uses another currency officially or unofficially as legal tender. There are greater economic benefits to be realised by going for full official dollarization compared to semi-official or unofficial dollarization. Dollarization does not always involve the US dollar as the adopted currency, the euro can be adopted by non-EU members in the same way Zimbabwe can adopt the South African Rand through full official Randrisation. Official dollarization requires to surrender monetary policy to another country and often a country loses seigniorage and an independent monetary policy. If Zimbabwe chooses dollarization by adopting full official randrisation, the country will still export and earn US dollars and use the same US dollars for imports and international obligations. The only difference is that the rand will be the predominant or exclusive legal tender for local transactions. The official randrisation discussed here
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