Gideon Gono: Wikis

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Doctor
 Gideon Gono

Gono after presenting a monetary policy statement to the Parliament of Zimbabwe, 2008.

Incumbent
Assumed office 
2003
President Robert Mugabe
Preceded by Leonard Tsumba

Born 29 November 1959 (1959-11-29) (age 50)
Rhodesia and Nyasaland
Political party Zimbabwe African National Union-Patriotic Front
Spouse(s) Hellen Mushanyuri Gono
Residence Harare, Zimbabwe
Alma mater University of Zimbabwe
Profession Banker
Religion Christian

Gideon Gono (born November 29, 1959) is the current Governor of the Reserve Bank of Zimbabwe (RBZ) and former CEO of the Jewel Bank, formerly known as the Commercial Bank of Zimbabwe.[1][2] Rapid expansion of the money supply on his watch has been blamed for contributing to Zimbabwe's hyperinflation.[3]

For his part in this, Gono was awarded an Ig Nobel prize in 2009 for "giving people a simple, everyday way to cope with a wide range of numbers by having his bank print notes with denominations ranging from one cent to one hundred trillion dollars".[4]

Contents

Earlier career

He started his career with government owned ZimBank, before moving to the Commercial Bank of Zimbabwe. He was appointed by Professor Jonathan Moyo to head the University of Zimbabwe Council where he was awarded with an honorary degree. During this time, he was the personal banker of Robert Mugabe, up until he was appointed as Governor of the Reserve Bank of Zimbabwe.

Reserve Bank Governorship

Gono was first appointed as Governor of the Reserve Bank in November 2003. In November 2008, Gono was reappointed to a new five year term as Governor, beginning on December 1, 2008.[5]

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Results of policies

After taking over the governorship of the Reserve Bank of Zimbabwe, Gono implemented a host of highly-criticized policies. The main criticism comes from his policies' exacerbation of the economic decline of Zimbabwe. Since he became governor, there have been a number of problems:[6]

  • cash shortages
  • fuel and food scarcity, shortages in agriculture[7][8][9]
  • businessmen have been arrested by the police and army under Gono's orders [10]
  • some Zimbabweans have become fugitives or have languished in prison, notably Mutumwa Mawere, James Makamba, July Moyo, Philip Chiyangwa and David Batau[11]
  • the highest inflation in the world and unemployment and the collapse of the health, education and agriculture sectors.[12]
The sight of motorists in long queues waiting for fuel is now a permanent feature in Harare. Gono promised to normalize the situation, but the people of his district have yet to see a great change in supplies.

Zimbabwe Dollar and inflation

Gono has printed enormous quantities of money against the advice of economists, but with full support from Robert Mugabe. As predicted by the textbook quantity theory of money, this practice has devalued the Zimbabwean dollar and caused hyperinflation.

Gono demonetized old bank notes on August 1, 2006 and introduced a new currency. Each new Zimbabwe dollar was worth 1000 old Zimbabwe dollars.[13] The highest denominations for the new currency were 1, 10, and 100 thousand revalued dollars. A year later on August 1, 2007, he authorized a 200 thousand dollar denomination. This marked the start of a series of new denominations issued in rapid succession, including 250, 500, and 750 thousand dollars (December 20, 2007); 1, 5, and 10 million dollars (January 16, 2008); 25 and 50 million dollars (April 4, 2008); 100 and 250 million dollars (May 5, 2008); 500 million and 5, 25, and 50 billion dollars (May 20, 2008); and 100 billion dollars (July 21, 2008). From the time of currency revaluation to the beginning of June 2008 the money supply in the country has increased from $45 billion to more than $900 quadrillion, or a 20,000,000 fold increase.

Gono refuted media reports that claimed he was against price cuts that the government instituted to arrest inflation. As time went by, it became apparent that the RBZ had instituted price cuts that saw bare shelves in shops and many businesses closing.[14] He has sent in the police to arrest businessmen for failing to reduce their prices. On one occasion, he personally visited shop owners in Harare to demand they lower prices.[15] Despite these efforts, inflation in Zimbabwe remains the world's highest.[16][17]

Critics have noted that most of Gono's monetary policy statements in the past have had biblical references. Notably, he usually ends in policy statements to the Parliament of Zimbabwe thus: "In the Lord's hands, I commit this Monetary Policy Framework for our economic turnaround."[18]

Banks and currency exchange

A number of banks have been raided and their operating licences cancelled.[19][20][21] Critics blame Gono for closing 16 money transfer agencies. He has traded foreign currency on the black market, an activity he vowed to crush when he became governor of the bank.[22]

Agriculture sector

The governor has spearheaded the campaign to make the land reform program a success. As such, Gono has placed the RBZ at the forefront of fertilizer and machinery procurement. A number of scandals have come to light, especially with the procurement of fertilizer, that implicate Gono.[23]

Backed by vice president Joyce Mujuru, Gono has several times called for an end to farm takeovers in a bid to stabilise agricultural production and halt inflation. Gono's criticism of farm takeovers is in sharp contrast to statements made by other ministers, including Lands Minister Didymus Mutasa.

In an interview with the state-controlled The Herald newspaper, he said, "I have openly condemned such retrogressive acts as destruction of horticultural greenhouses, decimation of tobacco barns, institution of fresh farm invasions".[24] "There are too many subdivisions among us, too many contradictions, too much infighting among ourselves, incredible suspicion and mistrust of one another," Gono said.

Admission of failure

Gono has admitted that his efforts to rescue and improve the economy of Zimbabwe have failed.[25] Gono said there were several factors that were outside the central bank's control, which made it difficult to rein in inflation. "Some of those factors are within the governor's control and influence while others such as politics, sanctions, droughts, under-utilisation of farms, disruptions at those farms, rampant corruption, indiscipline, law and order are factors outside the governor's control," he said in an interview with The Herald newspaper.[26] He has also blamed the failure of the economy on sanctions imposed on the country, a charge critics dispute.[27]

Critics and civic leaders allege that Gono has kept his job as the governor mainly through Mugabe's patronage. Mugabe has not only shielded Gono from his critics, but has commended him in his activities as governor despite the extreme deterioration of the Zimbabwean economy.[28] He had been Mugabe's banker for a long period before becoming governor of the RBZ.[29]

Personal life

Gono and his wife live in Borrowdale Brook, a northern suburb of Harare. They have just completed on construction of a new "castle-like" house, equipped with: 47 en-suite bedrooms; a glass swimming pool with underlights; a gym; mini-theatre; and landscaped gardens. Estimated to have cost USD $5 million, it is equipped with iris-scanning security measures as well as extensive camera coverage aiding perimeter control. It is also, perhaps conveniently, just a short drive away from (and indeed larger than) President Rogert Mugabe's own private residence.[30]

Gono also, like many of Mugabe's inner circle, own numerous farms which were confiscated from localised white farmers. One is near Norton, which when the seasonal weather is dry, draws clean water through a 25 mile long pipeline linked to a reservoir, which is supposed to supply water for the people of Harare. Gono also owns property in Malaysia.[30]

In November 2008, Gono published a book titled “Zimbabwe's Casino Economy: Extra-ordinary Measures for Extra-ordinary Challenges” describing the post-colonial economy of Zimbabwe particularly during the first five years (2003–2008) of his term as Governor of the Reserve Bank of Zimbabwe (RBZ”).

Personal sanctions

Gono is banned from travelling to the United States and EU member states because of his role in the controversial Zanu-PF government of Zimbabwe.[31] He was added to the EU's list of individuals subject to personal sanctions—a ban on travel to the EU and the freezing of any assets there—in July 2008, following the controversial 2008 presidential election, in which Mugabe was re-elected amidst serious political violence.[32]

References

  1. ^ "Zimbabwe: 'Mugabe downfall within six months'", Zimbabwe Standard, June 24, 2007
  2. ^ "Gideon Gono, Mugabe's new political tool", Kubatana.net, August 19, 2005 (accessed 02/08/2008)
  3. ^ "Hyperinflation in Zimbabwe" and cites therein, Greg Mankiw's Blog (accessed 05/24/2008)
  4. ^ "Gas mask bra traps Ig Nobel prize"
  5. ^ "Zimbabwe extends bank chief's tenure", AFP, November 26, 2008.
  6. ^ "TO DR. GIDEON GONO: The Truth", The Zimbabwe Gazette, February 4, 2008
  7. ^ Price Cuts[*Shortages in agriculture,] (accessed 02/08/2008)
  8. ^ "Roundup: Zimbabwe fights fuel crisis", Xinhua News Agency, May 31, 2006 (accessed 02/08/2008)
  9. ^ "Zimbabwe imports wheat", TVNZ, September 27, 2006 (accessed 02/08/2008)
  10. ^ Monetary Policy, AllAfrica, August 7, 2006 (subscription required) (accessed 02/08/2008)
  11. ^ "Unpacking the Butau-Gono Forex and Cash scandal", Nehanda Radio, January 4, 2008 (accessed 02/08/2008)
  12. ^ Alice in Wonderland, AllAfrica, February 1, 2007 (subscription required)
  13. ^ Slashes Zeros, AllAfrica, August 1, 2006 (subscription required) (accessed 02/08/2008)
  14. ^ "Gideon Gono: 'I'm not against price war'. (ZIMBABWE ECONOMY: The real story)", New African, August 1, 2007
  15. ^ No more mr. nice guy, AllAfrica, August 14, 2006 (subscription required) (accessed 02/08/2008)
  16. ^ "Zimbabwe inflation still soaring", USA Today, October 18, 2007 (accessed 02/08/2008)
  17. ^ "Zimbabwe: November Annual Inflation Rises to 26 470,8pc – CSO", The Herald, February 4, 2008 (accessed 02/08/2008)
  18. ^ "Gideon Gono “… in sheep’s clothing” : The Role of the RBZ Governor in Murambatsvina", Sokwanele, June 8, 2005 (accessed 02/08/2008)
  19. ^ Gono Under fire, AllAfrica, July 7, 2006 (subscription required) (accessed 02/08/2008)
  20. ^ "Central bank shuts down money transfer agencies in Zimbabwe", International Herald Tribune, October 10, 2006 (accessed 02/08/2008)
  21. ^ "Gono shuts down money transfer agencies", Independent Online, October 10, 2006 (accessed 02/08/2008)
  22. ^ "Zimbabwe: President Backs Gono", The Herald, February 16, 2007
  23. ^ "From Whom Did Gono Buy the Fertilizer?", ZimDaily.com, November 23, 2006
  24. ^ "Friends want me dead, claims Zim bank chief", Independent Online , October 23, 2006
  25. ^ "Zimbabwe's central bank chief admits failure", New Zimbabwe.com, November 3, 2006 (accessed 02/08/2007)
  26. ^ "Zim losing inflation battle", News24, October 23, 2006
  27. ^ "Dr Gideon Gono: How Sanctions are ruining Zimbabwe", African Business, June 1, 2007 (accessed 02/08/2008)
  28. ^ Leave Gono alone, AllAfrica, July 26, 2006 (subscription required) (accessed 02/08/2008)
  29. ^ "Gideon Gono’s star starting to fade", Zimbabwe Review, December 30, 2007 (accessed 02/08/2008)
  30. ^ a b "Lavish life of Mugabe’s looter-in-chief". London: The Sunday Times. 2008-12-21. http://www.timesonline.co.uk/tol/news/world/africa/article5375495.ece. Retrieved 2008-12-21.  
  31. ^ Recent OFAC Actions, US Dept. of Treasury, November 23, 2005 (accessed 02/07/2008)
  32. ^ "EU targets in Zimbabwe sanctions: central bank governor, head of cricket, 2 reporters", Associated Press (International Herald Tribune), July 23, 2008.

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