Zimbabwe Business Watch : Week 39

This week was more of the same as the economy continued in freefall seemingly rudderless with the RBZ Governor promising yet another economic turn around whilst visiting Morocco.

For business, the reality on the ground was that nothing would avert catastrophe other than the governing authority dominated by the MDC. It is understood that Dr Gono’s replacement is already in the wings and that a radical but progressive mini-budget would soon follow his arrival.

Power outages are increasing, seriously disrupting production and there are now instances where guarantees of electricity to those that pay in forex, are not being met. This is particularly evident in export manufacturing and mining.

Some reputable organisations are now trading in forex based fuel vouchers and a recent example was the auctioning of second hand cars in Harare.

Employers continue to struggle to pay their hard pressed workers and staff and the banking congestion is likely to trap wage and salary earnings in the system as it loses about 30% of its value per day.

The US dollar is sitting in a band of 45 000 to 60 000, whilst the ever diminishing volume of cash suppresses the street rate as hungry families try desperately to attract Zimbabwe dollar cash buyers for the foreign remittances that sustain them. It is believed that the Government debt has soared and is fast approaching GDP levels which are rapidly declining.

This entry was posted by Sokwanele2 on Monday, September 22nd, 2008 at 10:27 pm. You can follow any comments on this entry through the RSS 2.0 feed. Both comments and pings are currently closed.