Zim pays high economic price for hefty infrastructure spend

An expensive but vital infrastructure revamp being executed by President Emmerson Mnangagwa’s administration could by far be the biggest headwind confronting Zimbabwe’s new currency – Zimbabwe Gold (ZiG), a poll of leading analysts showed this week.

They said to save ZiG from suffering a similar fate to the Zimbabwe dollar (ZWL),  which was ditched on April 5, authorities must avoid resorting to the inflation – inducing printing press to fund the massive infrastructure facelift programme.

Money printing demonstrated its destructive effect during the decade to 2008, when the central bank relied on quantitative easing to salvage a faltering economy, but inevitably led to the collapse of the local currency when inflation hit 500 billion percent.

This story is for NewsDay subscribers.