Zim economy deteriorates after lengthy drought

droughtdroughtFrom MARCUS MUSHONGA in Harare, Zimbabwe
HARARE, (CAJ News) – DROUGHT ravaging Zimbabwe is worsening the Southern African country’s economic difficulties.

The erratic rains and increasing temperatures have reduced agricultural output and disrupted hydropower production and water supplies, leaving up to 4 million people in need of food aid.

This represents a third of the population.

The International Monetary Fund, which has concluded a mission to Zimbabwe, reports that economic activity is severely constrained by tight liquidity conditions resulting from limited external inflows and lower
commodity prices.

Inflation remains in negative territory, because of the appreciating United States Dollar and lower commodity prices.

The US greenback is the country’s main currency after the country ditched its worthless currency several years ago amid record inflation running to trillion percentages.

Zimbabwe remains in debt distress and the level of international reserves is low.

“Unless the country takes bold reforms, the economic difficulties will continue in medium-term,” IMF warned.

The institute said given the outlook for the global economy, growth is projected to remain below levels needed to ensure sustainable development and poverty reduction.

Zimbabwe, South Africa’s northern neighbor, has suffered a spectacular economic collapse over the past two decades.

From supplying the region with food in its heyday, it now imports from neighbouring countries.

With unemployment is hovering above 90 percent and salaries uncompetitive, millions have fled the economic crisis and sought sanctuary mainly in South Africa.

Critics blame long-time leader, Robert Mugabe and his Zanu-PF policies for ruining the economy.

The administration has blamed restrictive measures effected by the West after the country violently took over land from the minority whites for resettlement among the blacks in the year 2000.

– CAJ News

Short URL: http://cajnewsafrica.com/?p=12908

Posted by on May 5 2016. Filed under Africa & World, Featured, Finance, National, News, Regional. You can follow any responses to this entry through the RSS 2.0. You can leave a response or trackback to this entry

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