Zimbabwe in fresh cash crisis

via Zimbabwe in fresh cash crisis | SW Radio Africa by Tichaona Sibanda  November 27, 2013

Just a month before Christmas Zimbabweans are standing in long winding queues to withdraw cash from banks, amid reports of a fresh liquidity crunch.

Simon Muchemwa, our correspondent in Harare, told us that cash shortages and long bank queues, last seen during the 2008 meltdown when the Zim dollar was still in use, are now commonplace.

After the July elections were controversially ‘won’ by ZANU PF, the country’s banking sector lost nearly a $1 billion to offshore accounts due to political uncertainty amid concerns about the new government’s economic policies.

Muchemwa said depositors are no longer making regular deposits and this has resulted in most banks imposing withdrawal limits of $200, in an attempt to make the little cash available go around.

Civil servants were last week paid their annual November bonuses and have been rushing to banks to access their salaries, a situation that has increased the demand for cash ahead of the festive season.

Munjonzi Mutandiri, the regional coordinator of the newly formed political party the NCA, told SW Radio Africa that there is no debate the economy’s performance is linked to the politics of the country.

‘In Zimbabwe it is clear that the government is arrogant and to a certain extent irresponsible for bringing economic ideas that are not in the best interests of the country.

‘Their economic policies are not good for the country and that brings lack of confidence in the economy. The only way to remedy this is to go back to the drawing board and come up with a blue print that helps the nation and not individuals,’ Mutandiri said.

Economist Luke Zunga agreed that the flight of money from Zimbabwe was because of the economic policies generated by the political system.

‘One of such policies is indigenization, so anybody who is sitting in Zimbabwe with a business there would think twice whether to keep their money or not. The political system doesn’t encourage growth in the economy itself and it is a derivative of the economic policies of the government,’ Zunga said.