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Vol 61 No 2

Published 23rd January 2020


Zimbabwe

Power struggles and inflation

A wrecked economy will cause more worry this year but it won’t stop the two leading factions battling for supremacy

As Zimbabwe limps into 2020, its heaviest shackle is the economy. One analyst suggests it will shrink by 12.9% while inflation averages 165.5%. Last February, Minister of Finance Mthuli Ncube unpegged the 1:1 exchange rate between the local 'bond' currency and the US dollar. In June he removed the multi-currency regime that had been introduced in 2009 to curb hyper-inflation. Inflation spiralled, and will certainly escalate in the coming year. At the end of 2019, the Zimbabwe National Statistics Agency reported that the Total Consumption Poverty Line was rising by 15% a month. Alongside the spiralling inflation, the parallel market is thriving.

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