Opinion & Analysis
Can Zimbabwe offer any lessons?
Zimbabweans buy goods priced in US dollars at a supermarket in Harare. Genesis of its woes can be traced to the seizure of white-owned farms. Photo/REUTERS
Posted Tuesday, February 16 2010 at 00:00
This may look unbelievable but that’s how serious the issue had become.
In fact the economy has now fully transited into a US dollar economy.
The stock market has adopted it and even buying a sweet from the hawker along the streets must be by the currency. This has stabilised the economy a great deal.
The economy desperately needs resuscitation and the last thing it may need at this point in time is retrogressive laws like the indigenisation and empowerment law.
Such news emanating from Harare is likely to make the economic recovery a hard nut to crack.
The economy lacks liquidity and banks needs to recapitalise.
It is virtually impossible to access credit from any financial institution in this country.
The lending has been limited to a maximum period of 180 days.
But it is not all gloom. The World Bank’s 2010 Global Economic Prospects report, projects an economic growth of 7.1 per cent in Zimbabwe this year then slows down to 6.3 per cent next year.
Mr Kihuro is a risk management practitioner at Shelter Afrique in Nairobi. jkihuro@yahoo.com
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