Harare, Zimbabwe (PANA) - The United States Agency for International Development’s food security arm, FEWS NET, says households are expected to limit meals daily owing to worsening livelihoods
This comes as macroeconomic conditions continue to be generally volatile due to hyperinflation driven by a depreciating Zimbabwe dollar and a dollarising economy.
In its new July food security update, FEWS NET said across most deficit-producing areas of the country, crisis outcomes are expected to persist up to January 2021.
This is due to reduced/depleted own-produced food stocks and reliance on markets where access will be poor due to the below-average purchasing power.
“Households are expected to engage in consumption-based coping including limiting the frequency and quantity of meals as well as livelihood coping such as the atypical sale of livestock and labour migration. In the worst-off districts, some households are expected to experience Emergency,” FEWS NET said.
“Poor households in most surplus-producing areas are expected to meet their minimum food needs from own-produced stocks through at least late-August/September. They are also expected to have some income from crop sales as well as labor, self-employment, and petty trade.”
Prices of most staple foods and non-food items remain significantly above average and continue to increase in local currency although at a slower rate.
But, these prices are expected to rise further owing to shortages of foreign currency from official sources.
Further, the drought-like conditions of the 2019/20 agricultural season has impacted the output of Zimbabwe’s main staple crop, maize, and caused shortages of the grain and therefore maize meal.
FEWS NET said shortages of grain would lead to poor households in most surplus-producing areas relying mainly on markets for food as own-stocks deplete starting in October, with stressed outcomes expected at least through January.
“ZIMSTAT (Zimbabwe Statistics) reported the June annual inflation rate at 737 percent, remaining very high despite a slight decrease from 786 percent in May. However, monthly inflation increased to 32 percent in June from 15 percent in May,” FEWS NET said.
Currently, the official US$/ZWL foreign currency exchange rate stands at US$$1:ZWL80.46, a near 40 percent increase from 23 June, when Zimbabwe's central bank introduced a foreign currency auction.
And while the official foreign currency rate maybe lower than its parallel market comparative, the latter remains the main price aggregator in Zimbabwe at US$1:ZWL130.
As a result, the ZWL is depreciating as businesses demand the greenback as a more stable currency.
"This is disadvantaging mainly poor households with low incomes earned in ZWL. The government now requires all providers of goods and services to display prices in both the US$ and ZWL at prevailing official exchange rate. However, the government has indicated there are no plans of abandoning the ZWL even as the use of the US$ increases,” FEWS NET said.
-0- PANA TZ/MA 10Aug2020