Zimbabwe’s economy is heading for a crash

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Robert Mugabe is never short of strategies to appease suffering Zimbabweans. On Wednesday he launched a new “cheap food hampers” on comprising basic commodities to be sold “to all households around the country at affordable prices”.
But, as in the past only Zanu PF card holders stand to benefit.

The hampers consists of goods like maize meal, cooking oil, flour and soap.
Mugabe said the hampers would “bring relief to the people” who were suffering from “the effect of illegal sanctions imposed by Western countries”.

By yesterday there were no indications as to where the goods came from or how the programme was financed.

The hamper plan follows the introduction shortly before the universally-condemned June 27 run-off presidential election, of “people’s shops” – state-owned stores where goods were sold at low prices.

Huge queues formed outside the stores, where people bought as much as they could and then sold them on the streets outside at inflated black market prices.

Earlier, central bank governor Gideon Gono said that the programme would “show manufacturers that goods can be produced and sold to people at affordable prices and still make a profit”.

Economists say that Zimbabwe’s economy is heading for a crash, as inflation soars to new heights. Gono said Wednesday inflation was now at 2.2 million percent, although analysts estimate it at ten times that – and the Zimbabwe dollar is plunging to new lows.

A single US dollar bill was trading on Wednesday at Zim$70bn, down from Zim$45bn late last week.

Mugabe, 84, blames sanctions for the country’s hardships, although critics point out that he, his family and cronies are the only ones targeted by sanctions banning them from travelling to most Western countries and from holding assets there.

According to the United Nations Food and Agricultural Organisation, the last summer harvest yielded only 575 000 tonnes of maize, the national staple, against demand of about 1.8 million tonnes.

According to the UN, 29% of the population is “chronically malnourished”.

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