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Economy grew in 2021 whilst livelihood of citizens deteriorated as UN report shows

Let’s imagine there are two ecosystems that are distinct and barely interact. Where, although you could point to some correlations, you understood that both ecosystems survived on vastly different fodder. What happens if one of those ecosystems thrived? Well, that would have little impact on the other.

That is the story of Zimbabwe and its two vastly different economies – the formal and the informal. The govt is clueless on how to deal with the informal economy which has a life of its own. Most Zimbabweans participate in the informal economy and the best the govt can do to participate is introduce a 2% tax on all transactions.

Now, in 2021, we recorded a growth in the formal economy. The World Bank says the Zim economy grew by 5.1% and this growth was good enough for a Senegalese paper to rank our finance minister in the top 5 in Africa. If only the 5% meant that much to the average Zimbabwean whose life was not in the least bit improved by the 5%.

Report confirms actual deterioration in livelihood

The UN’s World Food Programme released a report on monthly food security and the Zimbabwean situation continued to deteriorate in 2021, despite the 5% growth in the formal economy. While I wouldn’t expect a growth in the economy to have a direct and significant impact on the day-to-day lives of citizens, I would expect to see signs of an improvement. 

The report says,

The food security situation in the country continued to deteriorate due to constrained household food availability and access as a result of depleted household stocks and limited livelihood options. In December, an estimated 5.9 million people reported insufficient food consumption. The estimated number of people employing ‘crisis and above’ – level food-based coping strategies increased from 9.3 million people in November to an estimated 9.6 million at the end of December 2021…

WFP

That right there tells you that whatever happened in the formal economy did not translate into any tangible positive to the average person. It all goes back to there being two distinct economies in Zimbabwe. The WFP highlights this,

While the country’s economy grew by 5% in 2021 compared to a decline of 4% in 2020, this was largely driven by macro level growth in the mining and agricultural sectors and does not reflect the situation for the most vulnerable households in urban and rural settings who are still struggling to recover from the impact of COVID-19 and previous shocks experienced in the country, mainly drought and cyclones

WFP

Inflation, our mortal enemy

We talked about how it’s hard to celebrate the falling of annual inflation from 350% in December 2020 to 61% in December 2021. This is cumulative so, after general prices grew by 350% from 2019 to 2020, they then grew by a further 61% in 2021. What fell was the rate at which prices were rising, the actual prices continued to increase throughout 2021. Enough to claim the 6th highest inflation rate in the world.

This issue of rising cost of living is why the minister of finance faced criticism for celebrating being ranked in the top 5 in Africa. So, he can celebrate his 5% growth while we mourn the fact that the prices of food basket commodities increased by 67% from December 2020 levels. That’s the story right there:

  • Economy grew by 5.1%
  • Food basket prices grew 67%

With this in mind, I hope the minister can forgive us for our lack of enthusiasm for his vanity metrics.

You should also read:

Breaking down the poverty info released by ZIMSTAT, Zim situation dire


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11 thoughts on “Economy grew in 2021 whilst livelihood of citizens deteriorated as UN report shows

  1. What was the method of research used to determine this? And why is Techzim using a UN report when there are several local databases with up to date information & stats on this?

    The formula is pretty simple = Number & percentage of target households (have enough to meet their survival threshold,

    What is the survival threshold? The reason we enquire is because there are detailed reports which claim the contrary.

    Please give us substance

    1. It would be best if you research further on how UN, collects, analyses and publishes such data. To help you UN has résident commissioners in Harare, heading different UN organs like UNESCO, WFP to name a few. These regulary conduct thorough surveys unlike our own ZIMSTAT, albert they have more reliable information. Googling about ‘food situation report Zimbabwe’ would give you some of these reports and you would see how thorough they are. On another note write down everyone you know at a personal level in Zimbabwe. Start with people who share the same surname with and do your own survey. You will be surprise 50% barely have enough to eat!

      1. thank you for the info but i think you missed the point of the enquiry, the point was there are several reports which claim the contrary and are backing their reports with research methodology, analysis and fact, if u then say i should go and research further on how UN collects and publishes such data then what’s the point of the article? if we are going to copy and paste UN reports and call it news without explaining the detail then that’s a very lazy approach of reporting, and anyone can do that!

        1. Ok….nw tht u have explained yourself i must say i do agree with u, the quality of techzim content is deteriorating sadly.

        2. So Anonymous you’re saying zimbabwe is booming and Techzim together with the UN are lying right? You’re either a fool or a very ignorant person

          1. Vicvaldo…..and that makes you very smart for reducing yourself to insults over an article? Techzim is just regurgitating a UN report so whether they are lying or not is not the question. All i did was ask for substance, there are reports all over other news websites which are claiming the opposite of this, go to bloomberg, canal france etc and they show how they came about that conclusion, its not about feelings its about facts which can be backed up, if you are suffering it doesnt mean the whole of Zimbabwe is suffering, prove it with facts that’s all. no need for violence. Techzim should have at least researched how the UN came about this conclusion and explained it to us their readers rather than just copying and pasting, where is the value in that honestly???

            1. If you live in Zimbabwe you don’t need to listed to those sponsored articles on bloomberg to know the real situation in Zimbabwe. People are getting poorer day by day!

  2. You don’t need a UN report to see that ED is destroying this country. People are getting poorer by the day and every time a policy change is done it is meant to drain whatever is left out of poor people while ED and crew live lavish lifestyles

  3. i agree with you only on one aspect of what you said, that you don’t need a UN report, the way the article is written makes it seem like just because UN said so then it must be true without explaining anything further, very mediocre, the rest of what you said is very subjective.

  4. After all is said and done, Zim will be Zim where the reality is the mass suffers and the selected few thrives, it has always been that way during the colonial reign during Mugabe’s reign and now ED’s reign, it is the law of the jungle the strongest species survive …

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