Zimbabwe government says a number of measures, both monetary and fiscal are being implemented to address the challenges that the country is going through in the absence of financial support from International Finance Institutions (IFIs).
The country is facing an increasing year on year inflation which by March 2020 had reached 810 up from February’s 640.
Local currency, which includes the Bond Note and the RTGS, has been losing value against the United States Dollar (USD) and by 29 May 2020, the rate stood at USD1: 51.8 Bond at the parallel market and USD1: 25 official bank rate.
It has also become a norm for citizens to buy cash like a commodity on the black market, with the country facing liquidity challenges.
Zimbabwe National Chamber of Commerce (ZNCC) impact analysis on COVID-19 projects that the Gross Domestic Product (GDP), year on year growth will further decline to -9% in 2020
Broadcasting and Information Minister Monica Mutsvangwa discussing on the State of the Economy report received by the cabinet from Finance Minister and the Reserve Bank of Zimbabwe (RBZ) Governor attributed the current economic growth to the COVID-19 pandemic and the 2018-19 drought.
“In tandem with other global economies, Zimbabwe’s economy has been negatively impacted by the COVID-19 outbreak and growth is expected to slow down,” Mutsvangwa said.
“The drought experienced in the 2018-19 and the current season coupled with diminished access to external sources of foreign currency further compounded Zimbabwe’s economic situation.”
But, information revealed by Broadcasting Minister Monica Mutsvangwa from the cabinet shows that the government is optimistic in solving the challenges that have been bedevilling the economy before even President Emmerson Mnangagwa’s administration took over.
“It is also stressed that the current price and foreign exchange rate fluctuations are clearly divorced from real economic fundamentals and can also be attributed to speculative tendencies,” Mutsvangwa said.
“The Minister of Finance and Economic Development and the Governor of the Reserve Bank of Zimbabwe will announce measures which should see the situation stabilizing in due course.”
Due to outstanding debts, Zimbabwe has not been able to access fund from the IFIs