WASHINGTON DC —
The Zimbabwe Congress of Trade Unions on Wednesday held an economic review workshop in Harare amid the worsening economic crisis that has resulted in deflation.
Zimbabwe recorded deflation in February in what analysts deemed a further dangerous indicator for the struggling economy. Deflation worsened in March as inflation dropped to -0.91 percent from - 0.94 percent in February.
Sustained deflation can be dangerous for an economy as a widespread decline in prices may lead to consumers delaying purchases.
It can trigger a destructive spiral where companies forced to cut prices also reduce wages and lay off workers, leaving consumers with less money to spend and the entire economy worse off.
Economists are predicting that deflation will take years to tackle as the economy is reeling from depressed industrial production. The weakening South African rand has also worsened the crisis.
The ZCTU workshop discussed the government’s economic blueprint- the Zimbabwe Agenda for Economic and Social Transformation (Zimasset), the 2014 national budget, the 2014 monetary policy and the economic outlook.
One of the key note speakers at the meeting was Labour and Economic Development Research Institute of Zimbabwe Godfrey Kanyenze.