Gideon Gono
Encyclopedia
Gideon Gono 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. Rapid expansion of the money supply on his watch has been blamed for contributing to Zimbabwe's hyperinflation
.
For his part in the hyperinflation, Gono was awarded an Ig Nobel parody 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".
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
.
, 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:
, 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. 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 denied 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. 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. Despite these efforts, inflation in Zimbabwe remains the world's highest.
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."
Backed by vice president Joyce Mujuru
, Gono has several times called for an end to the farm invasions sanctioned by the ZANU-PF party, as these destroy the Zimbabwean economy. 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".
"There are too many subdivisions among us, too many contradictions, too much infighting among ourselves, incredible suspicion and mistrust of one another," Gono said.
"Some of those factors are within the governor's control and influence while others such as politics, sanction
s, drought
s, 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. He has also blamed the failure of the economy on sanctions imposed on the country, a charge critics dispute.
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. He had been Mugabe's banker for a long period before becoming governor of the RBZ.
Like many of Mugabe's inner circle, Gono also owns 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.
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)".
On October 24, 2010, the South-African newspaper Sunday Times
ran a story claiming that Gono had an affair with Grace Mugabe, the wife of President Robert Mugabe. Later it was speculated that the story could have been made up as a part of internal fighting inside the ruling party or the RBZ
, in which Mugabe was re-elected amidst serious political violence.
Reserve Bank of Zimbabwe
The Reserve Bank of Zimbabwe is the central bank of Zimbabwe.-History:The bank traces its history to the Bank of Rhodesia and Nyasaland, founded in March 1956, which in turn was the successor to the Central Currency Board....
(RBZ) and former CEO of the Jewel Bank, formerly known as the Commercial Bank of Zimbabwe. Rapid expansion of the money supply on his watch has been blamed for contributing to Zimbabwe's hyperinflation
Hyperinflation in Zimbabwe
Hyperinflation in Zimbabwe began shortly after destruction of productive capacity in Zimbabwe's civil war and confiscation of white-owned farmland. Food output capacity fell 45%, manufacturing output 29% in 2005, 26% in 2006 and 28% in 2007, and unemployment rose to 80%...
.
For his part in the hyperinflation, Gono was awarded an Ig Nobel parody 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".
Earlier career
He started his career with government owned ZimBank, before moving to the Commercial Bank of Zimbabwe. He was appointed by Professor Jonathan MoyoJonathan Moyo
Jonathan Nathaniel Moyo is a controversial political figure in Zimbabwe. He was Minister of Information from 2000 to 2005 and is currently a Member of Parliament. He is considered the core architect of AIPPA and POSA....
to head the University of Zimbabwe
University of Zimbabwe
The University of Zimbabwe in Harare, is the oldest and largest university in Zimbabwe. It was founded through a special relationship with the University of London and it opened its doors to its first students in 1952. The university has ten faculties offering a wide variety of degree programmes...
Council where he was awarded with an honorary degree. During this time, he was the personal banker of Robert Mugabe
Robert Mugabe
Robert Gabriel Mugabe is the President of Zimbabwe. As one of the leaders of the liberation movement against white-minority rule, he was elected into power in 1980...
, up until he was appointed as Governor of the Reserve Bank of Zimbabwe
Reserve Bank of Zimbabwe
The Reserve Bank of Zimbabwe is the central bank of Zimbabwe.-History:The bank traces its history to the Bank of Rhodesia and Nyasaland, founded in March 1956, which in turn was the successor to the Central Currency Board....
.
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.Results of policies
After taking over the governorship of the Reserve Bank of ZimbabweReserve Bank of Zimbabwe
The Reserve Bank of Zimbabwe is the central bank of Zimbabwe.-History:The bank traces its history to the Bank of Rhodesia and Nyasaland, founded in March 1956, which in turn was the successor to the Central Currency Board....
, 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:
- cash shortages
- fuel and food scarcity, shortages in agriculture
- businessmen have been arrested by the police and army under Gono's orders
- some Zimbabweans have become fugitives or have languished in prison, notably Mutumwa MawereMutumwa MawereMutumwa Dziva Mawere , is an African businessman with interests in mining, manufacturing and agro industries, financial services , telecommunications, publishing, investment holdings, transport and logistics, and international trading, among others...
, James Makamba, July Moyo, Philip ChiyangwaPhilip ChiyangwaPhilip Chiyangwa the founder of the Affirmative Action Group, a chair of Native Africa Investments Ltd., and has served as an MP for the ZANU-PF party in Zimbabwe. He is a cousin of President Robert Mugabe....
and David BatauDavid BatauDavid Butau is a member of parliament of Zimbabwe representing the district of Guruve North. He was chairman of the parliamentary Portfolio Committee on Budget and Finance.... - the highest inflation in the world and unemployment and the collapse of the health, education and agriculture sectors.
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 moneyQuantity theory of money
In monetary economics, the quantity theory of money is the theory that money supply has a direct, proportional relationship with the price level....
, this practice has devalued the Zimbabwean dollar
Zimbabwean dollar
The Zimbabwean dollar was the official currency of Zimbabwe from 1980 to 12 April 2009....
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. 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 denied 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
Reserve Bank of Zimbabwe
The Reserve Bank of Zimbabwe is the central bank of Zimbabwe.-History:The bank traces its history to the Bank of Rhodesia and Nyasaland, founded in March 1956, which in turn was the successor to the Central Currency Board....
had instituted price cuts that saw bare shelves in shops and many businesses closing. 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
Harare
Harare before 1982 known as Salisbury) is the largest city and capital of Zimbabwe. It has an estimated population of 1,600,000, with 2,800,000 in its metropolitan area . Administratively, Harare is an independent city equivalent to a province. It is Zimbabwe's largest city and its...
to demand they lower prices. Despite these efforts, inflation in Zimbabwe remains the world's highest.
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."
Banks and currency exchange
A number of banks have been raided and their operating licences cancelled. 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.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.Backed by vice president Joyce Mujuru
Joyce Mujuru
Joice Mujuru is a Zimbabwean politician serving as Vice President of Zimbabwe. She has held this post since December 2004, and is also Vice President of ZANU-PF...
, Gono has several times called for an end to the farm invasions sanctioned by the ZANU-PF party, as these destroy the Zimbabwean economy. Gono's criticism of farm takeovers is in sharp contrast to statements made by other ministers, including Lands Minister Didymus Mutasa
Didymus Mutasa
Didymus Noel Edwin Mutasa is a Zimbabwean politician, currently serving as the Minister of State for Presidential Affairs and as the Secretary for Administration of ZANU-PF.-Family background:...
.
In an interview with the state-controlled The Herald
The Herald (Zimbabwe)
The Herald is a government owned daily newspaper published in Harare, the capital of Zimbabwe.-Origins:The newspaper's origins date back to the 19th century. Its forerunner was launched on June 27 1891 by W E Fairbridge for the Argus group of South Africa...
newspaper, he said, "I have openly condemned such retrogressive acts as destruction of horticultural
Horticulture
Horticulture is the industry and science of plant cultivation including the process of preparing soil for the planting of seeds, tubers, or cuttings. Horticulturists work and conduct research in the disciplines of plant propagation and cultivation, crop production, plant breeding and genetic...
greenhouses, decimation of tobacco
Tobacco
Tobacco is an agricultural product processed from the leaves of plants in the genus Nicotiana. It can be consumed, used as a pesticide and, in the form of nicotine tartrate, used in some medicines...
barns, institution of fresh farm invasions".
"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. 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, sanction
International sanctions
International sanctions are actions taken by countries against others for political reasons, either unilaterally or multilaterally.There are several types of sanctions....
s, drought
Drought
A drought is an extended period of months or years when a region notes a deficiency in its water supply. Generally, this occurs when a region receives consistently below average precipitation. It can have a substantial impact on the ecosystem and agriculture of the affected region...
s, under-utilisation of farms, disruptions at those farms, rampant corruption
Political corruption
Political corruption is the use of legislated powers by government officials for illegitimate private gain. Misuse of government power for other purposes, such as repression of political opponents and general police brutality, is not considered political corruption. Neither are illegal acts by...
, indiscipline, law and order are factors outside the governor's control," he said in an interview with The Herald newspaper. He has also blamed the failure of the economy on sanctions imposed on the country, a charge critics dispute.
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. He had been Mugabe's banker for a long period before becoming governor of the RBZ.
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 Robert Mugabe's own private residence.Like many of Mugabe's inner circle, Gono also owns 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.
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)".
On October 24, 2010, the South-African newspaper Sunday Times
The Sunday Times (South Africa)
The Sunday Times is a popular South African Sunday newspaper. It has an audited circulation of 504,000 and a weekly readership of 3.2 million, making it the largest weekly newspaper in South Africa. Recently it was involved in exposing a corruption scandal involving the South African government's...
ran a story claiming that Gono had an affair with Grace Mugabe, the wife of President Robert Mugabe. Later it was speculated that the story could have been made up as a part of internal fighting inside the ruling party or the RBZ
Personal sanctions
Gono is banned from travelling to the United States and EU member states because of his position in the Zanu-PF government of Zimbabwe. 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 electionZimbabwean presidential election, 2008
The Republic of Zimbabwe held a presidential election along with a parliamentary election on 29 March 2008. The three major candidates were incumbent President Robert Mugabe of the Zimbabwe African National Union - Patriotic Front , Morgan Tsvangirai of the Movement for Democratic Change , and...
, in which Mugabe was re-elected amidst serious political violence.
External links
- Ankomah, Baffour. "Gideon Gono: 'Zimbabwe Will Not Die'", New African, Aug/Sep 2007
- Thornycroft, Peta. "New Zimbabwe Law Allows for Eviction of Remaining White Farmers", Voice of America, October 7, 2006
See also
- List of individuals banned from entering the United Kingdom, a list Gono is on