Inflation in Zimbabwe has topped 20 million percent, according to Kingdom Bank, one of the country?s leading financial institutions. It predicted tougher times without a rescue by donors and investors, which would only take place if there were to be a political breakthrough.
The Web news service ZimOnline quoted Kingdom as saying that foreign exchange shortages are stifling domestic production as firms struggle to purchase raw materials and spare parts. It said maize and wheat shortages spell further rises in maize-meal and bread prices.
The bank said a political settlement by the long-ruling ZANU-PF party and the Movement for Democratic Change is essential to disrupt a vicious inflationary cycle.
VOA was unable to obtain confirmation of the ZimOnline report from Kingdom Bank\.
But independent Analyst Rejoice Ngwenya told reporter Patience Rusere of VOA's Studio 7 for Zimbabwe that a national unity government will drain national finances further as parties seek posts for their members, and that Mr. Mugabe's presence will deter new investment.