Zimbabwes economy in the past years and now Essay - 1

Zimbabwes economy in the past years and now - Essay Example This research will begin with the statement that during the past few decades Zimbabwe has faced major political and economic problems that have contributed to an almost dual figure negative growth in her economy. These factors have also contributed to an enormous rise in inflation, disregard of the rule of law and market breakdown. The country’s GDP has been a victim of decline since 1990. According to the macro economic figures researched by IMF in 2008, Zimbabwe’s GDP dropped from 7 % in 1990 to negative 6 % in 2007. This negative growth can be attributed to adverse weather conditions which led to the worst decline of negative 10 % GDP growth in 2003 which was a contribution of a major drought that was witnessed in 2003. These figures have however shown an encouraging growth since 2003. Currently, three major problems face Zimbabwe’s economy notably; scarcity of food, less fuel delivery, and power load-shedding as a result investors shy away. It is worth noting that the major cause of these problems dates back to the era where the country’s commercial farms were nationalized. Nationalization of commercial farms has seen its effect on a reduced export earnings and low food production. This means the country has to cater for expenses on an importation of food and consequently reduced earning in foreign currencies. In addition, foreign banks’ and donors’ withdrawal of financial aid, as well as credits, has worsened the state of the economy in Zimbabwe.