Breathing life into Zimbabwe's zombi economy

First step in restoring confidence in Zim is restoration of political stability

Actually, the term astronomical is not, strictly speaking, correct
because there are fewer than 5sextillion planets, stars and asteroids
in the universe.

But we should not make light of this statistic.

The awful truth is that the Zimbabwean economy is entering its end
days. It has, for some time, ceased to serve the needs of the majority
of Zimbabweans, who are living from hand to mouth in a barter economy.

It has failed as an investment destination because the risks have outweighed the potential returns.

Robert Mugabe and his somewhat deluded central bank governor, Gideon
Gono, have been putting it out that sanctions are to blame for the
Zimbabwean economy's parlous state.

But this is dissembling. Sanctions have been imposed on Mugabe and his henchmen, not on foreign investors.

The truth is that Zimbabwe has ceased to offer the opportunities and the infrastructure needed to inspire investors.

An inflation rate of 5sextillionpercent and a currency that has lost 22 zeros over the last year do not inspire confidence.

What is needed now is a sense of urgency about rebuilding Zimbabwe's economy, firstly by ensuring political stability.

The swearing-in of the MDC's Morgan Tsvangirai as prime minister would greatly assist in this quest.

But it would have to be followed by a series of far-reaching and rapid policy changes that will inspire confidence.

These would have to include the end of state interference in corporate
ownership, the removal of restrictions on the repatriation of capital
by investors and an end to restrictions on capital flows.

And South Africa must move quickly to help its neighbour rebuild its economy.

Post published in: Economy

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