ECONOMY

THE Zimbabwe National Chamber of Commerce (ZNCC) warned on Thursday that there would be no quick fix to the myriad economic challenges plaguing the country.

Zimbabwe is in the throes of an economic crisis, which is exacerbated by a crippling liquidity crisis, currency volatility, continuous power cuts.

The southern African country is also grappling with an unsustainable over-indebtedness and runaway inflation of 280% which is hampering economic recovery.

Addressing participants at the annual congress of the Zimbabwe Employers’ Confederation, ZNCC chief executive Christopher Mugaga said reviving the economy would not be a walk in the park.

He said the battle would be tougher with a “borrowed currency” in place.

The country uses a multi-currency regime that includes the US dollar.

“There is no quick fix to Zimbabwe’s economic challenges,” Mugaga said.

“It will take a long time,” he warned.

“It’s not a picnic. It’s very difficult to grow with borrowed currency.

He said workers’ demands to be paid in foreign currencies could have a detrimental effect on the viability of businesses.

“It is possible to lobby for workers to be paid in foreign currency. It is also possible that businesses will collapse as a result,” he said.

Mugaga said it was necessary to exit from the monetary regime that the country uses if an economic recovery is to be achieved.

He also said the government’s projection of 4.6% gross domestic product growth for 2022 may be too high.

“Power challenges are very debilitating. We have to find a way to get away from that,” Mugaga said.

He said the country’s internal and external debts as well as sanctions had severely weakened the country’s prospects for economic recovery.

“We have to deal with the debt. We have to solve the debt problem. If we don’t, we keep joking,” Mugaga said.

He said that even if the country’s exports did well, they would be mired by the country’s over-indebtedness.

“We only have 180,000 formal jobs. the population has doubled (since independence in 1980) in Zimbabwe,” he revealed.

“One in 15 people has a formal job compared to one in six in 1980,” added the ZNCC CEO.

The congress is held under the theme Social Dialogue for a New Paradigm Shift for Economic and Social Transformation.

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