THE Economist Intelligence Unit (EIU) says the government-driven National Economic Revival Programme (Nerp) will not solve the current economic crisis because it is already in tatters owing to b
In a report for 2003-2004 the EIU said there was no hope the programme would solve the current crisis. It says government had undermined the revival plan and reneged on its earlier promises to the stakeholders of Nerp.
“If there was any belief that Nerp would be a solution to Zimbabwe’s economic crisis, the government itself undermined it by unilaterally announcing increases in wages and prices and then extending price controls over a comprehensive list of basic items,” the report said.
The EIU expressed concern over government’s commitment to implement the policies envisaged under Nerp. “It is clear that the programmes outlined in Nerp to boost various sectors of the economy, in particular the gold and tobacco sectors to improve foreign-exchange earnings, will not be implemented,” it said.
“The shortage of bank notes and foreign currency experienced in July and August, and the government’s odd and ineffective methods of addressing these problems, illustrate that there is now little constructive policy planning, merely ad hoc crisis management coupled with a hefty dose of wishful thinking.”
Under the Nerp agreement the decision to hike wages and prices of basic commodities was supposed to be reached with the tripartite negotiating forum (consisting of the government, organised labour and the business community).
Under the tripartite negotiating forum businesses and the unions had also agreed to police wage and price increases to help meet the inflation target of 96% by the end of the year.