3 January 2014

Zimbabwe: Bleak Outlook for Zim Economy in 2014

The economy in the country is not responding positively to last year's election results, raising concerns that it's stalling and heightening pressure on the ZANU PF government to deliver on its electoral promises.

This is according to lawyer and economic analyst Bekithemba Mhlanga who said the economic slowdown means the country may face a multitude of problems, including financial sector meltdown, increased unemployment and poverty, reduced growth and slow social development.

Mhlanga told SW Radio Africa on Friday that Zimbabwe's economy has suffered dislocation over a period of 16 years and that it cannot be repaired over a period of 12 months unless drastic measures are taken.

With the economy spiralling downwards, people losing their jobs, and companies closing down, 2014 will likely be remembered as one of the worst years in Zimbabwe's history.

Economists and experts warn that the potential crises in 2014 could eclipse even the 2008 turmoil that witnessed the inflation rate surging to 231 million percent, before the dollarization of the currency.

Mhlanga downplayed reports that ZANU PF's five-year economic plan, the Zimbabwe Agenda for Sustainable Socio-Economic Transformation, will form the bedrock of its attempt to spur economic growth.

Upon its implementation, the Zim Asset policy document projects that the economic growth is expected to average 7.3 percent, while forecast growth in 2018 is 9.9 percent.

"This document is the work of fiction than anything else. It does not address the issues on the ground," said Mhlanga amid reports production, consumption, supply chain, investment, export and import have already been badly hit by ZANU PF's victory, which is being disputed by the opposition.

Opposition leader Simba Makoni also scoffed at claims by Patrick Chinamasa, the Finance minister that his spending plan ushers in the birth of a new economy, and the death of the old economy.

The Mavambo Kusile Dawn (MKD) leader told the Daily News newspaper that for the largest majority of Zimbabweans, life will remain as difficult in 2014, as it was in 2013; if not worse.

Makoni said in spite of all the rhetoric about the $4,1 billion 2014 national budget being "policy driven", there were "no rational, viable, coherent policies that can guide citizens, especially players in the economy, to plan for the future with clarity and confidence."


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