Zimbabwe economy to contract by 18%, claims Biti

FORMER Finance minister Tendai Biti has claimed that Zimbabwe's economy could contract by up to 18% due to the biting effects of the COVid-19 pandemic.

In an interview with NewsDay yesterday, Biti claimed that amid the crisis created by the coronavirus, it was disturbing that parliamentarians approved the 2021 National Budget without demanding that it should cushion people against the effects of the virus.

"It's disturbing to note that in 2019, the international Monetary Fund (IMF) gave billions of dollars to 83 countries, but Zimbabwe missed the boat. For instance, some countries like Uganda got US$499 million, but Zimbabwe missed the boat because of our pariah status and so the fortunes of Zimbabwe's economy are inextricably connected to politics," he said.

"We have not been able to access the huge amounts of money from the World Bank, IMF, and from the African development Bank which has been used to cushion other countries during the COVid-19 pandemic.

"We are now in a second lockdown period, and the disturbing thing is that Parliament has just passed the 2021 budget and yet there are no funds to cushion Zimbabweans against COVID-19."

The Harare East legislator (MDC Alliance) also said there was a race between the rate of infection and the rate of vaccination, including in developed countries such as the United States, the United Kingdom and other European countries, but Zimbabwe was inactive.

"In Zimbabwe, that race is not there because we have got a government that is actually clueless. Government is still saying that we are going to debate the vaccine, yet the vaccine is the only thing that can flatten the COVID-19 curve," he said.

"Secondly, there is a lockdown, there is the January disease, there is poverty and yet people have been locked inside their houses, and the government is incapable of giving social safety nets. Countries like South Africa, Egypt and Kenya are giving social grants to their citizens because you cannot flatten the disease curve without flattening the hunger curve, and the body needs resistance."

Biti said as a result of poor COVid-19 strategies, the informal sector, which constitutes of 95% of unemployed people in the country, had been locked in a cage because of the lockdown regulations.

"So i see a massive trip of this economy by a factor of a minus 12% to minus 18% in 2021. this is consistent with projections by the IMF," he said.

"In the next few days, they are going to issue a regional economic outlook, and that is going to confirm the huge downward dip that Zimbabwe is going to face."