HARARE -- Zimbabwe was ranked the worlds second least competitive economy in a report released by the World Economic Forum last week. Only the war-torn central African nation of Burundi performed worse than Zimbabwe, according to the report.
The influential WEF said that despite formation last February of a coalition government by President Robert Mugabe, Prime Minister Morgan Tsvangirai and Deputy Premier Arthur Mutambara, corruption and lawlessness remained rampant in Zimbabwe making the country unsuitable for business. The WEF surveyed 133 countries measuring their competitiveness according to 12 Global Competitive Indicators (GCI) such as infrastructure, education, macroeconomic stability, health data or the number of internet users. The study also assesses government efficiency and flexibility of the labour market.
According to the report, Zimbabwes problems included the complete absence of property rights, corruption, basic government inefficiency, poor monetary policies and macroeconomic instability. It said: The institutional environment continues to be ranked among the worst of all countries, with a complete absence of property rights (ranked last out of all countries at 133rd), high levels of corruption (122nd), and a lack of evenhandedness of the government in its dealings with the public (129th) as well as basic government inefficiency (124th). The report casts fresh doubt on the effectiveness of policies and programmes put in place by the unity government to try to restore investor confidence in Zimbabwe and attract foreign capital to help revive the countrys once brilliant economy.
Zimbabwe has asked to host next years World Economic Forum which would be shifted from traditional hosts South Africa because of the soccer World Cup. But the chances are now slim after the damning ranking by the same group. In a damming account of the business operating environment in Zimbabwe, the WEF report said: Even amid the international economic turmoil affecting so many countries, the extreme mismanagement of the public finances and monetary policy has placed Zimbabwe once again at the bottom of all countries covered with regard to macroeconomic stability (ranked 133rd). Zimbabwe continues to carry out massive deficit spending, engendering unsustainable public debt. Raging hyperinflation that was unparalleled internationally recently pushed the government to suspend the printing of Zimbabwean dollars and to dollarise the economy in the early months of 2009.
Weaknesses in other areas include health (ranked 128th in the health sub-pillar), low educational enrollment rates, and official markets that are functioning only with great difficulty (particularly with regard to goods and labor markets, ranked 130th and 125th, respectively). The six-month unity government has done well to stabilise the economy and end inflation that was estimated at more than a trillion percent at the height of the countrys economic meltdown last year. But the administration has failed dismally on several other fronts, failing to end lawlessness and violence in the mainstay farming sector, while political violence continues in many parts of the country.
Post published in: Agriculture