BY TATIRA ZWINOIRA
LEGAL think-tank Veritas says the government did not give transport operators, vendors and representatives of commerce and industry time to prepare for new Covid-19 measures amid worsening macroeconomic challenges.
Due to unfavourable weather conditions, low disposable income depressing economic activity, a highly volatile local currency that has increased inflationary pressure, growing unemployment, and challenges in sourcing foreign currency to stabilise the Zimbabwe dollar, the economy continues to shrink.
But, with the return of strict Covid-19 measures,albeit justified amid a worsening spike, the informal sector, which constitutes over an estimated 70% of all economic activity, will feel the pinch.
This is coming at a time when the government has ordered the increase in tariffs and fees from line ministries while also significantly increasing presumptive taxes for the informal sector.
“The latest amendments were published without prior consultation between the government and interested parties such as transport operators, vendors and representatives of commerce and industry,” reads an op-ed by Veritas last week.
“Section 141 of the Constitution requires Parliament to ensure that interested parties are consulted about Bills before they are enacted, and the same must apply to regulations and orders made under statutory powers delegated by Parliament. On the other hand, section 141 allows consultation to be dispensed with if it is inappropriate or impracticable, and that seems to have been the case here: there was a need to deal quickly with the spike in Covid-19 cases.”
Veritas said the lack of consultation has, however, meant that interested parties have not been given adequate time to prepare for the new measures.
Another consequence of the lockdown is that not enough time was afforded to write exemption letters for employees told to work during this period.
This has been evidenced by the long motor vehicle queues on major roads leading into the capital’s central business district.
“For example, employers in essential services have not had time to write exemption letters to enable their employees to pass through police roadblocks. The spike in Covid-19 cases was foreseeable and the Government should have anticipated it in sufficient time to allow everyone concerned to be consulted and warned about what would be expected of them,” Veritas said.
“As it is, many vendors, cross-border traders and others in the informal sector are faced with economic devastation without any warning or provision for compensation, and without the protection of social security safety nets.”
A day after the strict 30-day Covid-19 lockdown effected last weekend, the Vendors Initiative for Social and Economic Transformation while agreeing with the need for the lockdown, noted no social protections had been put in place for the informal sector.
USAID food security arm, FEWS NET, reports that most poor households are engaging in consumption-based coping such as limiting portion sizes and skipping meals and livelihoods-based strategies, including extended casual labour, petty trading, and livestock sales to survive amid worsening poverty.
FEWS NET says in the worst cases, some households are expected to experience emergency situations as they face large food consumption gaps and extreme loss and/or depletion of livelihood assets.
And the USAID arm expects that significant humanitarian assistance will be needed to combat these challenges.
The annual inflation rate for the month of November 2020 stood at 401,66%, which is the second highest in the world after Venezuela, while the cost of living has reached nearly $23 000 when earnings are closer to half that amount.
The introduction of the Zimbabwe dollar as the sole legal tender in June 2019 resulted in inflation skyrocketing to as high as 836%, which has severely eroded incomes and pensions denominated in the local currency. The local currency has stabilised as a result of the foreign currency auction introduced by the Reserve Bank of Zimbabwe in June last year and the clampdown by monetary authorities on mobile money agents.
At the Zimbabwe National Chamber of Commerce 6th Annual Business Review Conference last month, the chamber’s former president Luckson Zembe said the general poverty based on work he did with non-governmental organisations was about between 70% and 80%.
In its new December 2020 Monthly Monitoring Report, the Zimbabwe Peace Project said it was important for the government to foster an environment where citizens and the government could interact.