Economic growth will contract in 2014, given persistent company closures. Real value will be generated in the susbsistence and dollar funded informal sector. Use of the US$ will ensure at most 2% real economic growth, inflation of 5% and GDP per head of US$200.00.
A return of the Zimbabwe dollar will further drive out capital and reintroduce hyperinflationary pressures, as the institutional dynamics of currency stability have not been reinforced in Zimbabwe's economy. A lack of confidence in Zim dollar still persists encouraged by an absent credible macro-economic plan.
Currency and funding shortages will persist, they is no strategy in place to deal with persisting liquidity challenges. Businesses need working capital, which given the scarcity of commercial paper and high interest rates is hard to come by: companies will continue to close, in 2014. Water and electricity shortages will guarantee difficult trading and living conditions for the nation's citizens. The State's Look East policy is not generating the infrastructural investment required to bring about medium term growth.
No comments:
Post a Comment