Zimbabwe News and Internet Radio

WB slashes Zim economic growth

By John Kachembere

The World Bank (WB) has confirmed that the country’s economy is dying, slashing the economic growth from 3,8 percent to 2,5 percent in yet another dose of bad news for the millions of long-suffering Zimbabweans who are struggling to make ends meet.

World Bank
World Bank

Last year, the WB downgraded the country from its list of improved economies to the unflattering tier of struggling countries.

In its latest Global Economic Prospects released on Monday, the WB also revised the country’s 2018 economic growth forecast to 1,8 percent from the initially projected 2,4 percent, as the country would be holding its watershed elections.

The Bretton Woods institution noted that political uncertainty and low business confidence were weighing on investment.

“In addition, weaker-than-expected growth in advanced economies or in large emerging markets could reduce demand for exports, depress commodity prices, and curtail foreign direct investment in mining and infrastructure in the region,” the WB said.

Economists yesterday told the Daily News that it was not surprising that the WB had slashed the economic growth.

“We can expect modest growth in maize production but not so much from cotton and tobacco production.

“The reduction in tobacco output will cancel out the increase in maize production — in value terms,” economist, John Robertson told the Daily News.

Analysts blame Zanu PF’s misrule and populist policies, such as its disastrous fast-track land reforms and the controversial indigenisation legislation for discouraging foreign direct investment inflows and causing massive company closures that have pushed the country’s unemployment rate above 90 percent, among a myriad other ills.

This latest development comes as Zimbabwe’s worsening economic situation has seen President Robert Mugabe’s government fighting hard to contain rising anger among long-suffering citizens who are struggling to get cash from the banks.

Zimbabwe is in the grip of a worsening economic crisis which has also witnessed a severe shortage of cash, including the recently introduced bond notes.

Despite injecting more bond notes into the market, and recently increasing their weekly importation of United States dollars by 50 percent, the government continues to battle to stem the acute cash shortages, which have seen desperate Zimbabweans besieging over-stretched banks, as they despairingly try to withdraw their money.

The disappearance of the country’s surrogate currency from the market has also often forced banks to give clients their cash in sackfuls of coins.

It has also seen banks limiting the amount of money both individuals and companies can withdraw, sometimes to as low as $20. Daily News