Obert Masaraure, the spokesperson for the Crisis in Zimbabwe Coalition (CiZC), says the sharp decline of the Zimbabwean dollar (ZWL) could be disastrous for rural communities, as they lack financial literacy.
Masaraure who is also the president of the Amalgamated Rural Teachers Union of Zimbabwe (ARTUZ) said many people in rural areas depend on savings from farming produce to survive, and with the ongoing devaluation of the ZWL, they are at risk of becoming impoverished.
He said the lack of financial knowledge among rural communities also makes them vulnerable to inflation and price fluctuations. The rising food prices ahead of the elections have made matters worse for the rural population. He said:
People in rural areas survive on savings from farming produce. With the continuous ZWL devaluation, the rural community will be rendered impoverished.
Rural communities are unable to make informed decisions to hedge their savings from the marauding inflation, which leaves them more vulnerable. They are not informed about the value of the ZWL against the greenback and some are selling wares at a loss.
There are concerns within the ruling ZANU PF that the state of the economy may have an impact on the outcome of the August 23 harmonised elections. This is particularly worrying since the rural population is the constituency where the party has the majority of its support.
According to official reports, on June 14, 2023, the exchange rate of the Zimbabwean dollar (ZWL) to the United States dollar was ZWL$ 5,978. However, by June 20, 2023, the exchange rate had fallen to ZWL$ 6,926.5764 to the dollar. This represents a significant decline in the value of the ZWL against the US dollar within a short period. The depreciation of the Zimbabwean dollar is more severe on the black market, where the United States dollar is being sold at around ZWL$ 7,900.
The rapid devaluation of the Zimbabwean dollar (ZWL$) in recent months has resulted in businesses increasing the prices of their goods and services. This development has affected many Zimbabweans, especially government workers who receive their salaries in the local currency. Despite the significant depreciation of the Zimbabwe dollar, the salaries of government workers have remained relatively unchanged. As a result, the depreciation of the currency has eroded the value of their salaries, leaving them worse off financially. This situation has caused significant concerns among government workers who are struggling to make ends meet due to rising costs of living.