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Zimbabwe Finance Minister Warns of Further Economic Hardship - 2001-11-01


Zimbabwe's finance minister says the country faces a further slide in its economy next year. Presenting the government's budget for 2002 to parliament on Thursday, Finance Minister Simba Makoni said inflation and unemployment will stay very high while the scarcity of foreign exchange will continue.

The finance minister told parliament that the gap between the Zimbabwe government's spending and income will widen next year, with the budget deficit reaching almost 15 percent of the value of total national economic output.

Mr. Makoni says inflation next year will be at least 85 percent, and 75 percent of the total population of Zimbabwe will continue to live in extreme poverty.

Spending on health will take up $40 million of total government expenditure of $1 billion next year.

For the first time in the 21 years of Zimbabwe's independence from Britain, details of military expenditure were not disclosed in the budget speech. Government officials say the figures will be released later.

The opposition Movement for Democratic Change party is critical of the government's spending plans. The party's economic affairs spokesman, Eddie Cross, termed the budget "extremely negative" and said Finance Minister Simba Makoni is acknowledging that it will prove very difficult to turn the economy around.

The head of the department of business studies at Zimbabwe's national university, Tony Hawkins, said the budget has what he calls "no relevance to the real situation."

Meanwhile, members of the U.N. Food and Agricultural Organization have arrived in Harare to assess the government's progress in restoring the rule of law on commercial farms.

The FAO team is to investigate, among other things, allegations by civic groups and commercial farmers that farm invasions by pro-government militants have continued.

At a meeting in Nigeria earlier this year, the Zimbabwe government agreed to end invasions and stop the lawlessness that has led to the deaths of a dozen farmers and their workers and injuries to thousands more.

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