Harare 2 - Everyone's an economist
by Jack Stilgoe
Zimbabwe's is an economy going rapidly backwards. Its size has halved in the last 8 years. Unemployment is between 70 and 80% (although the Government hilariously claims it is "pegged" at 9%). Inflation, the ever-optimistic local newspaper tells me, is now down to 900%. Two rates of exchange exist. Unofficially, Western cash will earn you four or more times the offical exchange rate. Those with money or stuff to sell are forced to reinvent markets every week. Petrol is driven over from Mozambique and sold for whatever people will pay. The cashpoints can't be filled quick enough to dispense the doorstops of notes required to buy almost everything. Things will get better, everyone tells me. The taxi back to the airport costs me 4.5 million dollars.
UPDATE: 5 days after this post, the Zimbabwean government decided to devalue their currency and knock three zeroes off. The BBC web site reports today (Mon 7th Aug) that they have now imposed a price freeze. Considering the extent to which the conomy has been what we might call "radically decentralised," it will be interesting to see if Zimbabwean businesses show any interest at all in keeping their prices constant while the value of wages plummets.