ZW VIEW | 2024 is going to be one of your worst years, and you’re on our own. Here’s a list of crises to worry about

Zimbabwe’s economy is in for one its toughest years in ages. You wouldn’t notice it, what with ribbons being cut on new 4X4s and authorities going about their business as usual.

If you were looking for evidence of some urgency, you wouldn’t find it in the minutes of Cabinet’s last meeting on Tuesday. There was no mention of the crop crisis; the biggest sections in the brief were dedicated to the “CALAs”, and the critical matter of the Independence Day Children’s Party to be held at Murambinda in April.

Do not turn to government’s chief communicators either, if you were expecting updates on the drought response, the Food Deficit Mitigation Strategy, launched by Local Government Minister July Moyo and the World Food Programme in December. No, go to them only if you want all the running updates and cutting-edge insights into whatever it is that’s happening over there in the opposition. You will also get up-to-date commentary about which waste tenderpreneur recently got a PhD from a man who changed his name to “Enrico Maverick”.

OK, we know bad news is hard to read. We don’t like writing it either. But we think you deserve more important news than this tragicomic news cycle of Songezo Tshabangu, Dilesh Nguwaya, what colour shirt your favourite politicians will wear next, or non-existent fresh elections. So, we bring you here a most cheerful list of things that should keep you up all night, just so you tighten your belt accordingly – if you can still afford one.

Worst drought in years

Nobody has to spell out what a drought does. First, is the hunger. The Food and Nutrition Council, a committee of government and donors, says 2.7 million Zimbabweans need food aid. Minister July Moyo says the government has 71,500 tonnes of grain in store to feed the hungry. Low harvests mean food prices will rise. On Thursday, Zimstat said food prices were the biggest contributor to inflation in February. Your groceries will be more expensive going forward.

The problem is not so much the drought itself. It is whether the government is prepared, and communicating its plans.

More imports, more currency woe

A drought means that we must import more goods. Already, private millers are buying maize abroad. Because the drought has hit other countries in the region, including our biggest maize import source South Africa, grain prices may rise and millers may have to look further afield. This means more foreign currency leaving the country to buy basics, and more expensive maize meal too.

Electricity: More power cuts

Less rain in the region means there’s less water to generate power at Kariba. The Zambezi River Authority, which manages the water at the lake, has allocated the least ever amount of water to Zimbabwe and Zambia for power generation, because water levels are too low. This points to more power cuts, especially in the winter months. That sucks at household level, and also slows down the economy even more.

Commodity prices: less forex for Zim

What does the price of platinum and lithium have to do with you? It’s not like you have a mine, right? Well, here’s the thing; Zimbabwe gets most of its foreign currency from selling minerals. Now, the prices of those minerals are falling, very badly. Many had expected a “lithium boom”. It’s not coming, at least not in 2024. Lithium prices are down as much as 85% since last year. Many of the big lithium mines that opened over the past two years are struggling, and we are unlikely to see new mines soon. Platinum prices are also falling. Zimplats reported a 105% drop in earnings for the December half-year. The mine is putting many projects on hold, which has an impact on local suppliers and the economy at large.

What it means? There will be less US dollars coming into the economy.

And one more thing; remember, the government relies on sales of platinum to pay off debts to Afreximbank. Also, the government has a pile of maturing bonds that it needs to pay this year, in addition to other already troubling debts.

Hole in your pockets

So, what does all this talk of GDP growth, commodity prices and so forth mean to you? It simply means the year will be a whole lot harder than 2023. Food prices will rise. Because we will be importing more and exporting less, there will be more demand for the USD and the “rate” will fall faster. Because of the drought, power cuts are certain. Importing extra power will need more USD. With less money coming in, Mthuli Ncube will keep taxes high, and he may even hit you with more of them. You are his easiest source of money.

There are no big, fancy words to describe it – we are in for a horrible year. For the few households that still have some disposable incomes, saving will be key. For businesses, costs will be trimmed – and this implies job losses. Simbisa, one of the country’s biggest companies, has just said it is “aligning staff numbers to shop size to manage staff costs”. We all know what this fancy boardroom lingo really means, right?

OK, so the government may not be tightening any belts, unless it’s the seatbelt of a new Isuzu 4X4. But, for the rest of us, actual belts will have to be tightened.

Take it from the World Bank. They have just released a new report, and it says this: “People in Zimbabwe are increasingly reliant on successive rounds of emergency relief rather than a formal government safety net.”

In short, you’re on your own.