Lockdown: Zimbabwe workers face uncertain future

THE 21-day national lockdown to contain the spread of the Covid-19 scourge which has seen the death of almost 40 000 people globally has caused uncertainty among workers.

Kudzai Kuwaza

Government ordered the lockdown, which began at midnight on Monday, forcing companies to shut down during the period. The lockdown is likely to have an adverse impact on the viability of companies, most of which are already struggling to keep afloat due to an increasingly deepening economic crisis characterised by a debilitating liquidity crunch, acute foreign currency crunch, fuel shortages, low capacity utilisation and runaway inflation of more than 500%.

A recent survey by the Confederation of Zimbabwe Industries (CZI) revealed that 46% of local firms are being impacted by the disease. “Unemployment is likely to increase as employers scale down operations due to shortages of raw materials and access to export markets,” the report notes.

“The Covid-19 pandemic will slow down demand and economic growth revival efforts in 2020 for Zimbabwe due to lockdown in other markets and the local market.”

Zimbabwe Congress of Trade Unions (ZCTU) president Peter Mutasa told businessdigest this week that the lockdown will worsen the plight of the struggling worker.

“Many workers were already earning low salaries that were not sufficient for food security. The lockdown therefore means that the majority of workers will starve during the period,” Mutasa said.

“We therefore urge government and employers to intervene in various forms to mitigate the effects to workers. Firstly, all employers should pay full salaries for the period of the lockdown. Government should provide social security to workers earning low salaries as well as for informal traders and workers coming from companies that are really struggling.”

Mutasa said the full impact of the pandemic on workers is yet to be fully ascertained. “We are yet to fully assess the future economic costs and the impact of jobs. It is a global tragedy for workers.”

The uncertainty for workers could not have come at a worse time with prices of basic goods skyrocketing after government reversed the ban on the use of foreign currency for domestic transactions last week. Prices of goods have shot up at a time the local unit, which is the currency most workers are paid in, has been decimated due to inflation.

“Due to price increases, workers are spending more on fewer goods. There is need for government to subsidise basic commodities and ensure availability of the same,” Mutasa said.

Zimbabwean workers are not alone in this predicament as thousands of jobs are also on the line in neighbouring countries that have declared a 21-day lockdown.

Most countries are offering substantial fiscus and monetary stimulus upwards of 50% of GDP. The US has put together a US$2 trillion stimulus, China, the United Kingdom, Japan, Germany, Nigeria and South Africa, among several other countries have intervened with huge stimulus packages.

In South Africa, Cyril Ramaphosa announced a package of economic measures to protect credit, banking, business and jobs, as well as support those without formal incomes. He said last month he was aware that the cost to his country’s already flagging economy would be very high, with huge job losses.

In Zimbabwe, Finance minister Mthuli Ncube announced several fiscal stimulus measures to mitigate the impact of coronavirus to the economy and national health.
However, analysts say it is not enough.

Equity Axis managing director Respect Gwenzi said: “The key challenge with Zimbabwe’s form of stimulus is that it does not do much to save companies and employees alike. It leaves both to the mercy of the virus. In other countries employees are cushioned as government takes over partial payment of salaries and offer bailouts to struggling companies”. – ZimInd

%d bloggers like this: