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Zimbabwe shines to glory despite hardships

20 Jun 2019 at 07:17hrs | Views
Dr Masimba Mavaza
Zimbabwe has struggled to improve its deteriorating infrastructure in business, education, and healthcare. Zimbabwe's power grid is overstressed, and power failures have been daily occurrences in the most developed areas of Zimbabwe. The need for generators to provide power and air conditioning during power failures results in additional costs that businesses must subsume.

Public transportation and roadways have not kept pace with population growth, and the education infrastructure is backward with a literacy rate of 95% Zimbabwe's healthcare infrastructure is in need of reform. Zimbabwe provides healthcare to all its citizens, but the 90% who must use public health services and don't have private insurance through an employer receive poor care in substandard facilities.

The economy of Zimbabwe shrunk significantly after 2000, resulting in a desperate situation for the country – widespread poverty and a 95% unemployment rate. The rise in corruption by senior officials and harassment of investors by corrupt officials  set the stage for this deterioration by draining the country of hundreds of millions of dollars.Hyperinflation in Zimbabwe was a major problem from about 2003 to April 2009, when the country suspended its own currency. Zimbabwe faced 231 million percent peak hyperinflation in 2008. A combination of the abandonment  of Zimbabwe dollar and a national unity government in 2009 resulted in a period of positive economic growth for the first time in a decade.

Economic activity in Zimbabwe has remained resilient despite political and economic uncertainty in the first half of 2019 caused by the rumours of government change.
That  being said, the country continues to face challenges that include electricity load shedding fuel shortages social issues like raising living standards by reducing poverty and inequality, as well as addressing crime and corruption.

To tackle these challenges and boost growth in a way that will benefit a wider share of the population, reforms will need to focus on raising public investment and social spending, as well as re-invigorating the structural reform agenda with emphasis on strengthening the rule of law, fighting corruption, and reducing labor market informality, and encouraging production which is internal production. We must be producers not only importers. Zimbabwe must import as of now our production is minimum and our intake is high. We have reduced our country to be a shopping basket. Each one of us who gives priority to the foreign products ahead of his or her national products is contributing to the economical demise of Zimbabwe.
Zimbabweans get used quickly and this am used syndrome is the worst economic destroyer in the country.

But with the tough policies President Munangagwa is introducing our economy continues to grow despite the bitter pill we as a nation are swallowing.  In the near term, growth is expected to moderately pick up to 2.1 percent this year and 2.3 percent in 2020 Growth will benefit from strong economic activity witnessed in the country.  But continued tight monetary policy and uncertainty related to both the incoming currency will continue, thus dampening growth. 

While Zimbabwe's  public debt is projected to stabilize, the current level a high percentage of GDP—limits space for social and infrastructure spending. Keeping the overall fiscal deficit at a lower rate of GDP over the medium term would stabilize debt at around the current level, assuming what the minister of Finance is saying is true that medium-term growth increases to around 3 percent and the interest rate path remains steady. A slightly more ambitious target would improve budgetary spending room to deal with large infrastructure needs, high levels of poverty and inequality and the fiscal costs of an aging population.

Another is that social policies have not been targeted as well as they could have been. While conditional cash transfer programs and some developmentally programmes   have been very effective at reducing inequality, other social programs have disproportionately benefited individuals at the top rather than at the bottom of the income distribution.  In Shurugwi the member of Parliament honourable Ronald Robson Nyathi has come up with a great plan of poverty alleviation.  He has acquired gold claims for the community and formed a trust which is run by the community for the community. This is to use the local resources for the local people , the redistributive role of fiscal policy—targeted government expenditures to help lower income inequality—is generally stronger in Shurugwi. If this is adopted in the country there will be great inward growth in zimbabwe than in other countries. While honourable Nyathi is developing his constituency and province   

Improving security and strengthening the rule of law is critical to reducing crime and promoting economic activity. Zimbabwe is experiencing its most murderous year on record in 2019 and incidences of theft have also been on the rise. High levels of crime come with both direct and indirect economic costs due not only to damages but also the need for costly security measures. Even more importantly, firms may limit their activities and cancel their investment plans in response to a weak security situation. Small firms suffer these consequences disproportionately.

The delay in prosecuting corruption cases is another factor  destroying investor confidence.
Doing business in a corrupt country is difficult because there is little respect for the rule of law, there are competing government bureaucracies, and there are often unclear and unfair regulatory and taxation systems.

Some legislators are taking advantage of the investors at the expense of the country.
In all this darkness Zimbabwe will be out of this mess soon.

Zimbabwe is being fixed as we speak. The journey is painful and indeed slow but we will get there.

Not even one person is finding it easy things are tough. But there is a bright light ahead. This thing will work. Zimbabwe will work again.


Source - Dr Masimba Mavaza
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