The Zimbabwe Congress of Trade Unions (ZCTU) is warning that most companies will be forced to close shop after Finance Minister Patrick Chinamasa announced his mid-term budget review in which he increased levies on fuel as well as taxing even airtime and mobile phones.
Chinamasa admitted that the cash-strapped government which has been struggling to pay civil servants faces a challenge in raising additional revenue to finance “non-discretionary expenditures.”
Last month central bank chief John Mangudya sounded the alarm bells when he said foreign investment in Zimbabwe more than halved in the first six months of the year.
The Confederation of Zimbabwe Industries says capacity utilization in the manufacturing sector is expected to fall by almost 10 percentage points to around 30 percent in 2014. Opposition parties have also blasted Chinamasa for burdening poor Zimbabweans.
ZCTU secretary general Japhet Moyo says government’s desperation will hit the workers hard.