FORMER Finance minister Tendai Biti has warned that the country’s economy is “fast tracking into deep-seated economic recession” with the ruling Zanu PF regime “as carefree and indifferent as they are clueless.”
Biti, now leader of the opposition People’s Democratic Party (PDP), issued the dire assessment in his State of the Economy report issued Monday which warned that the country was headed for a crisis worse than the woe witnessed in 2008.
When it romped the victory in the 2013 elections – a triumph dismissed as fraudulent by the opposition – Zanu PF promised to turn the economy around and deliver two million new jobs in country where formal unemployment is said to be more than 85 percent.
But Biti said the economy was grinding to a halt with a massive collapse in output.
“The massive collapse of output is reflected by the deindustrialization which the economy has faced. Since 2013, 100 000 jobs have been lost and 60% of companies operating in 2010 have shut down,” he said.
“With the fall in production there has been reliance on imports with Zimbabwe now becoming a supermarket stocked with foreign products especially from South Africa which is using the weaker Rand as compared to the US dollar being used in Zimbabwe. “
Added to that the food security situation had also worsened with some three million Zimbabweans in need of help after a devastating drought which has also killed some 500,000 cattle country-wide.
The country’s liquidity crunch also deepens with Zimbabweans now forced to queue for withdrawals at banks.
“The government is raiding these RTGS balances so as to raise cash for supporting their bloated expenditures such as endless foreign trips for the President and hotel bills for Phelekezela Mphoko,” said Biti.
“The result of this has been cash shortages, long bank queues and withdrawal limits for clients which has greatly inconvenienced the banking public and further dampened confidence in the banking sector.
This financial situation is a perfect recipe for economic collapse as it makes doing business almost impossible without cash yet clients have their monies locked up in their accounts.
“We are heading towards a Greece like crisis and soon we will be mired in a crisis worse than the collapse of 2008.”
The ruling party was either disinterested or at a loss for ideas on what do to.
“It is also evident that Finance Minister Patrick Chinamasa and any of the acolytes in Zanu PF have neither the desire nor the ability of turning around this economy,” said Biti.
“Reengagement at this particular time with Zanu PF thugs engaged in factional fights for power is an exercise in futility as there is no appetite for genuine reforms within Zanu PF.”