Budget confirms dying economy

HARARE - Finance minister Patrick Chinamasa yesterday confirmed what we have been saying all along that the economy is on its deathbed.

Once regarded as President Robert Mugabe’s right hand man, but whose tenure at the helm of the country’s Treasury has turned him into a pragmatic economist, slashed the country’s growth target from 2,7 percent to 0,6 percent.

What this effectively means is that the Zimbabwean economy is grinding to a halt with clear evidence that the economy is fast-tracking into deep-seated recession.

As such, the country finds itself in another unwelcome circle of economic recession hard on the heels of the historic economic meltdown witnessed between 1997 and 2008, a period when Zimbabwe lost more than half of its economy.

It’s very distressing that land invasions are continuing while the Indigenisation Act has not been repealed and continues to scare away investors and the civil service is still infested with thousands of ghost workers.

There is also a biting liquidity crunch, which has been compounded by the country’s widening trade deficit.

The result of this has been cash shortages, long bank queues and withdrawal limits for clients which has greatly inconvenienced the banking public and further dampened confidence in the banking sector.

The present financial situation is a perfect recipe for economic collapse as it makes doing business almost impossible without cash yet clients have their monies locked up in their accounts.

From the look of things, it is evident that Chinamasa and any of the acolytes in Zanu PF have neither the desire nor the ability of turning around this economy and we are heading towards a Greece-like crisis and soon we will be mired in a crisis worse than the collapse of 2008.

The economy requires structural reforms if the country is to move forward and Zimbabwe must carry out structural reforms in order to convince the international community so that its debt relief efforts can be supported.

However, the Zanu PF regime has shown — for the past 36 years — that it lacks the will and the capacity to carry out such reforms.

With all this economic decay surrounding us, it was with utter disgust when we heard Mugabe telling all and sundry on Tuesday, during his State of the Nation Address, that the economy was on a recovery path. What hogwash!

How can the economy grow in the absence of key economic reforms?

Zimbabwe urgently requires stabilisation of the economy through the implementation of an emergency economic recovery programme that will inject urgent funds into the economy and that cannot happen as long as Mugabe is still in power.

Post a comment

Readers are kindly requested to refrain from using abusive, vulgar, racist, tribalistic, sexist, discriminatory and hurtful language when posting their comments on the Daily News website.
Those who transgress this civilised etiquette will be barred from contributing to our online discussions.
- Editor

Your email address will not be shared.