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Zimbabwe is sleepwalking into another hyperinflation art environment, opposition Citizens Coalition for Change Vice President and Former Finance Minister Tendai Biti has warned.
In 2008 inflation spiraled out of control driving the local currency into oblivion and forcing government to adopt the US dollar.
Biti used his micro-blogging site Twitter to give the stark warning to citizens of the impending chaos.
“The economy is in tailspin thanks to the absolute mismanagement of the exchange rate. Hyperinflation is back and slowly certain goods are disappearing from the shelves. We are sleepwalking to 2008. It’s dejavu #NHM,” said Biti.
Following the reintroduction of the local currency in a few years ago, the Zimbabwean Dollar has lost its value and now trading at US$1-ZWL$170 on the official market while on the black market it has hit as much as US$-ZWL$400 leading to acute price distortion.
The rate of decline of the local currency has accelerated in the past two months forcing prices of basic commodities through the roof.
Fears of the 2008 scenario have emerged forcing President Emmerson Mnangagwa to announce that his administration will do everything in its power to stop the rot.
Mnangagwa last month at a rally said banks and companies involved in local currency manipulation and unjustifiable increases in the prices of goods and services could lose their operating licenses.
He added that the government has identified the entities responsible, and they have found methods to deal with those banks and companies, and the plans will be announced in due course.
Mnangagwa said these economic players are not acting alone but rather they are sent by foreign countries hostile to Zimbabwe, so that they can weaken the local currency.
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