Captains of industry are pinning their hopes on talks between Zimbabwe's political rivals as a chance to stop the economic rot.
Captains of industry are pinning their hopes on talks between Zimbabwe’s political rivals as a chance to stop the rot after a survey on Wednesday showed investor confidence at a new low of 2%.
“Industry will give full support to the agreement signed on Monday,” Calisto Jokonya, president of the Confederation of Zimbabwean Industries (CZI), said at the launch of the body’s annual report on the state of the nation’s industry.
“This will give us a new direction we need as business ... we do not want to go back to what we have been doing” in the last 12 months.
An index of business confidence in the new CZI survey showed a drop from 5% to just 2% in the course of the last year.
This year’s report was released in Harare against a backdrop of an annual inflation rate that officially stands at 2,2-million percent, although economists say the real figure is in fact even higher.
The country’s economic meltdown is seen as one of the major factors in Zimbabwean President Robert Mugabe’s agreement on Monday to open talks with the main opposition Movement for Democratic Change, despite his re-election last month in a one-man ballot that was widely denounced as a sham.
“The business confidence level is still low, with 70% of the respondents being pessimistic and those that are optimistic dropping to 2%,” said the survey.
The country has been experiencing shortages of basic foods for some time and the report said the skyrocketing inflation rate—the highest in the world—would only make matters worse and dissuade the few people who still have jobs from shelling out on bus fares to work.
“Food shortages and food inflation are becoming worse, such that more people are absconding from work because of the high cost of living,” it said.
In a foreword to the survey, Hama Saburi, editor-in-chief of the Financial Gazette, said it was important that political players find a common ground that would form the basis of some cooperation in order to revive the economy.
“Zanu-PF will find it difficult to go it alone without the Movement for Democratic Change [MDC],” Saburi wrote.
“And the MDC should not fool itself to think it can go it alone either. Whatever government shall emerge out of the discussions between the main political parties should make an effort to reach out to business and labour ... Zimbabwe cannot afford failure in this regard.”
Kenias Mafukidze, an economist with independent think tank KM Financial Solutions said Zimbabwe needed a clear economic policy that respects market forces backed by robust industrial policy.
“The survey sends a clear signal that current policies are slowly but surely destroying what was once Africa’s most robust and diversified manufacturing sector, replacing it with a nation of traders who do not add value,” Mafukidze said to AFP.
The CZI said that 80% of the country’s infrastructure was currently idle due to shortages of skilled workers, power cuts and a lack of foreign currency.
Once one of Africa’s best-performing economies, Zimbabwe has been in meltdown since the turn of the decade, when Mugabe embarked on a controversial land-reform programme that saw thousands of white-owned farms seized by the state.
Meanwhile, the start of full-scale talks to resolve Zimbabwe’s political crisis were delayed for a second day on Wednesday as the main parties’ top negotiators had yet to arrive in South Africa, sources said.
The negotiations, initially due to start on Tuesday and already facing a race against time given a two-week deadline, are not now due to begin in earnest until Thursday when all sides are in place in Pretoria.
The delays mean Mbeki, the chief mediator between Zimbabwe’s ruling Zanu-PF and the MDC, may not be around for the start of the talks as he due to fly out Thursday to attend a European Union summit in south-west France.
Although a spokesperson for Mbeki said the talks process had started, sources within the MDC and Zanu-PF both confirmed that senior members of their delegations had yet to fly out of Harare.
“Tendai Biti [MDC secretary general] left this morning [Wednesday], but chairperson Lovemore Moyo is still in Bulawayo. He can either leave today or Thursday, his flight booking has been done already,” an MDC source said.
“The talks are only starting on Thursday so he can leave anytime.”
A Zimbabwean government source also confirmed that Zanu-PF’s chief negotiator, Patrick Chinamasa, was still in the country.
“Minister Chinamasa is still around. He can either leave tonight or first thing in the morning.”—AFP