UN report warns of potential economic consequences for Zimbabwe due to Russia-Ukraine conflict

December 27, 2022
market | Report Focus News

Zimbabwe is facing the prospect of further economic uncertainty due to the ongoing conflict between Russia and Ukraine, according to a new report from the United Nations (UN). The southern African country is already grappling with the effects of the COVID-19 pandemic and reduced maize harvests, which have put its economy on shaky ground.

The UN report highlights the direct impact that the conflict has had on food and fuel prices, trade, fiscal tightening, and governance issues in Zimbabwe. It also notes that the uncertainty surrounding the Black Sea Grain initiative could potentially affect other grain prices if the situation is not resolved.

Political and social commentator Ricky Mukonza pointed out that the supply of grains such as wheat and sunflower oil has been disrupted, leading to price increases, while economist Chenayimoyo Mutambasere emphasized Zimbabwe’s vulnerability to global shocks due to its dependence on imports and trading associations with Russia, which may be further impacted by economic sanctions imposed against Russia.

Mutambasere said that Zimbabwe needs to implement policies to stimulate local production in order to protect itself from the potential effects of the Ukraine crisis. “Policies such as a move away from the multi-currency regime and the interchange auction will go a long way in re-establishing the domestic market,” she said.