The depth of Zimbabwe’s economic downturn
Zimbabwe is home to some of the world's most incredible natural wonders and wildlife. The economy has excellent human capital, comparable to that of upper-middle-income economies in Sub-Saharan Africa.
Also, Zimbabwe possesses abundant mineral and natural resources that are enough to make it one of the wealthiest on the African continent.
Amid this, Zimbabwe grapples with economic challenges. The 2023 Zimbabwe Vulnerability Assessment Committee’s Urban and Rural Livelihood recently in November estimated that 29% of the urban population in 2023 which is 1.5 million of the population are food insecure, 19% of people in rural areas which represents 1.9 million people are projected to be food insecure from October to December 2023, and 26% of the Zimbabwean population in the first quarter of 2024, local media NewsDay Zimbabwe reported.
In the same month, the Zimbabwe National Statistics Agency said the total consumption poverty line (TCPL) for the month of November increased 9.5% to ZWL$115,090.00 (about USD 357) for an individual from ZWL$105,071.98 (about USD 326) in October.
The food poverty line was also estimated at ZWL$87 756 (around USD 272), experiencing a 9% increase in November from October.
TCPL is the minimum total income needed for an individual not to be deemed poor while the food poverty line is the amount of money an individual requires to afford a daily minimum energy intake of 2,100 calories.
November’s Inflation rate has also experienced a 21.6% increase from the 17.8% in October.
Perhaps the International Monetary Fund (IMF) was right in its prediction of Zimbabwe’s economy in 2023. The IMF during a visit to Zimbabwe in December predicted a fall in GDP by 3.5 percent in 2023 due to renewed domestic and external shocks, inflation surge, erratic rainfall, electricity shortages, and Russia’s war in Ukraine.
According to the World Bank’s assessment, persistent inflation, high dependence on low-productivity agriculture, slow structural transformation, and intermittent shocks like drought, natural disasters, and the COVID-19 pandemic have contributed to the high rate of poverty and vulnerability in Zimbabwe.
Zimbabwe has strong foundations for accelerating future economic growth and improving living standards. The question remains: how soon can Zimbabwe revive its economy?
