HARARE, July 27 -Zimbabwe’s economy faces implosion a year after disputed elections, said Morgan Tsvangirai, the former prime minister and leader of the opposition Movement for Democratic Change.
The country faces a serious liquidity crisis and a lack of investment, Tsvangirai said at an event at Chatham House in London today.
Zimbabwe’s economy is threatened with recession as factories shut, consumer spending slumps and deflation takes hold. Retail sales fell 30 percent in February from the previous month, while 15 factories in the metals and engineering industries closed in the period, according to the government.
President Robert Mugabe, the 90-year-old leader of the Zimbabwe African National Union-Patriotic Front, defeated Tsvangirai in an election in July last year that local observers and the U.S. said were marred by voter irregularities.
“While we know that Europe is re-engaging Zimbabwe and President Robert Mugabe’s ZANU-PF, the EU must insist that Zimbabwe adopts the full provisions of the constitution agreed to last year,” Tsvangirai said.
Foreign investment in Zimbabwe has remained “embarrasingly low” because investors remain uncertain about a law that compels them to sell or cede 51 percent to black Zimbabweans, Nigel Chanakira, chairman of the Zimbabwe Investment Authority said July 1.
Finance minister Patrick Chinamasa said in May that lawmakers are committed to changing the law, though no action has yet taken place.
“We’ve become a rudderless ship isolated from the world community,” Tsvangirai said.