The gloom that has engulfed Zimbabwe s struggling economy shows no sign of lifting and as things stand we see limited chance of a meaningful economic recovery taking hold over the next couple of years. Underpinning this grim view is our expectation that the crippling political uncertainty that has characterised Zimbabwe s investment climate in recent times looks set to continue over the next one to two years at least as the ---- elections approach. ...For consumers, the main way this is felt is through remittances. Remittance flows have been a key factor in driving private consumption in recent years, but with a large chunk of the remittances to Zimbabwe originating in South Africa, the weakness of the rand has eroded the dollar value � the currency in which most goods are priced in Zim- babwe � of these inflows significantly over the past two years. This in turn is adversely affecting purchasing power and a key reason why falling prices have not delivered the improvement in purchasing power that one might expect. ...One small bright spot for consumers and producers will come from continued lower oil prices. We forecast Brent to average USD--.-/bbl and USD--/bbl in ---- and ---- from an average of USD--.-/bbl in ----.
...Source: National sources, BMI Private Consumption: We expect private consumption growth will accelerate slightly in ---- to -.- from -.- in ----. ...a collapse in the mining sector will continue to threaten jobs, and disposable income. Government Consumption: Government spending will be curtailed by a drop off in revenue from taxes and limited capacity to borrow internationally given restrictions from institutional lenders until the country s USD--bn outstanding debt has been cleared. As a result, growth in this segment will increase to just -.- from -.- in ----. ...We forecast exports to fall to -.- in ----, from -.- in ----.
...
