STELLA MAPENZAUSWA, Harare | Wednesday 11.50am.
ZIMBABWE companies will post weaker results for 2000 as the country grapples with an acute economic crisis seen compounded by farm invasions, analysts said on Wednesday.
Over the past fortnight, firms have warned that 2000 results will not match those for the previous year, with National Foods saying on Tuesday its prospects remain vulnerable to an acute foreign currency shortage, high inflation and interest rates.
”Factors relating to the land resettlement issue are also now impacting on agricultural and general confidence,” Natfoods said in a statement. ”The half yearly results to 30 June 2000 are anticipated to be substantially down on the June 1999 comparable.”
In its latest economic review earlier this week, Standard Chartered Bank said illegal farm invasions since February have damaged the important agriculture sector, with winter wheat plantings down about a third from last year. About 60% of Zimbabwe’s industry is agro-based.
The farm invasions, together with an upsurge in political violence ahead of next month’s general elections, have left at least 24 people dead, sparking an international outcry.
On Tuesday Natfoods warned of possible food shortages later in the year if the country’s foreign exchange crisis is not resolved because imports of raw materials will be reduced.
Last week gold producer Rio Tinto Zimbabwe said it had recorded a small first quarter loss and expected a weaker first half performance than it posted in the same period for 1999.
The company said the country’s current economic crisis threatened the viability of Zimbabwe’s gold mining industry, a key foreign currency earner which contributes about 1,5% to Zimbabwe’s gross domestic product and employs about 35000 people.
Meanwhile the Standard Chartered Bank said on Wednesday that a severe foreign currency shortage is intensifying in the country, inflation could rise above 70%, and the economy could shrink by at least 5% this year as the result of the political crisis. — Reuters & AFP