Back in 2018, Mthuli rebased the economy and boosted official GDP figures by 40%. GDP instantly became USD25bn, raised from USD18 bn.
The starting point of USD18bn was contentious. The figure was fake. Our GDP was lower than that. The argument of adding forgotten sections of the normal sector (which are larger) made sense, but there were no forgotten sections in reality.
The stats had already been adjusted, massaged, and manipulated over the years to include everything. I suspect Mthuli desired a higher GDP so that the country could:
be classified as being very close to middle-income status
qualify for high-value loans
Fast forward to December 2020, what's our GDP?
GDP for 2020 was ZWL 1,157,099,904,460
A trillion Zimbabwean dollars. How much is that in USD?
Using the official rate prevailing at the end of the year, GDP is around USD 16.5bn but using the parallel market rate GDP is only USD 11.5 bn. The truth will always come out. Rina manyanga hariputirwe.
Even if we stick to the official rate, it simply doesn't make sense to say the economy declined from USD25bn in 2018 to USD16bn in 2020. A 36% contraction from 2018 to 2020. It seems like a claw back of the artificial boost of 40%.
The USD 25 bn was a lie. A joke, not to be taken seriously.
The lie was short-lived. 2018 GDP was officially recognized at USD 19 bn. Yet even if we accept 19bn, we get a 14% decline from 2018 to 2020. So where is the GDP growth that we talk about? 2020 was a pandemic year, GDP understandably declined by 8.1%.
What excuse do we have for 2019? No excuses. The official rate is what they use for official stats, yet huge swaths of the econ don't transact at that rate. The GDP of USD 16.7 bn is also a lie.
The correct USD GDP value is around 11.5 bn. That's the size of our economy based on the official stats they produced, and the rate produced by the free market. This is very far from the USD25bn GDP. GDP per capita in USD terms = 716
The GDP per capita excludes Zim from the bracket of middle-income countries that Mhutli desires us to be in. The moral is, you cannot fudge numbers into becoming a middle-income country.
You cannot become a billionaire by simply typing a billion as your bank balance on an MS Excel bank statement. (Yay, am now a billionaire). The lies, the basements, the tomfoolery, the tricks, massaging numbers, creative accounting, etc do not create prosperity.
If you lie serially and chronically regarding economic data, the free market exchange rate will always expose you. Once again, we ask, what's Zimbabwe's GDP? A lot of different numbers are thrown out. The ZWL 1.1 trillion (USD11.5bn) makes a lot of sense.
On that note ZSE market cap at end of 2020 was 371 bn, meaning the Buffet Indicator was at 32% The Buffet indicator = Market Cap/GDP It's used to gauge whether a market is fairly valued, overvalued, or undervalued. ZSE has now gone above a trillion. More on this later.
Ciao!