HomeBusiness DigestEconomic ills worsen housing plight

Economic ills worsen housing plight

Conrad Dube

THE government has reduced Zimbabweans to perpetual tenancy as an acute shortage of housing worsens.

The country has a

housing shortage of about four million units and this has driven most Zimbabweans into informal settlements around major cities. Harare alone has a housing backlog of about one million units.

Movement for Democratic Change (MDC) secretary for economic affairs Tendai Biti says Zimbabweans have become so poor that they cannot afford decent accommodation as the economy continues to tumble. Biti was speaking at a rally in Norton on Sunday.

“We have seen an unprecedented increase in lodgers because the government has failed to provide basic accommodation to citizens,” said Biti.

“The government is ignoring the suffering of the people.

“Zimbabweans can no longer afford even decent underwear while their dignity has been reduced to levels where they accept sub-standard products from China,” he said.

He said the economy has continued to tumble due to lack of foreign currency, a weakening local unit and the collapse of industry. The dollar is currently trading at $14 000 to the United States dollar and $22 000 to the British pound on the parallel market.

While on one hand the depreciation of the dollar has steeply raised the prices of imported raw materials and inputs, industry, on the other hand, has not been privileged with a corresponding price increase of commodities as price controls on selected products prevail.

For instance, fuel merchants were last month ordered to revert to the old fuel price of $3 600 per litre after they had increased prices to $3 900 a litre.

Economist John Robertson in an interview said interference in pricing slowed down business in the three months to March while elections caused uncertainty in the business community.

“Many companies put expansion and new investment plans on hold because of the uncertainty currently prevailing. Some of it was caused by the elections and some of it was caused by the changes to the platinum sector and agricultural marketing,” said Robertson.

He added the business community had questions over February’s inflation rate figure which showed a 5% decrease to 127% from January’s 133%.

“The three months were characterised by foreign currency shortages and were quite difficult for many businesses,” Robertson said.

Zimbabwe National Chamber of Commerce president Luckson Zembe said the trading period was relatively depressed due to annual closures and the election period. Zembe said investors had adopted a wait and see attitude ahead of the election.

“Foreign currency inflows were lower than expectations as demand continues to outstrip supply. We have been supplying only 10% of demand on the foreign currency auction and this creates pressure on the exchange rate,” Zembe said.

The pressure on the exchange rate will create a fertile ground for businesses to engage in speculative activities which feed into the parallel market, according to Zembe.

“The answer is not in more controls but pushing up supply side. We really need balance of payments support and the restoration of international relations if we are to successfully deal with the foreign currency problem,” the ZNCC chief told businessdigest.

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