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hits aid agencies' capacity to assist
February 22, 2007
- Hyperinflation and an unrealistic foreign exchange rate has posed
tremendous challenges for humanitarian organisations in Zimbabwe
struggling to provide aid and development assistance.
"We fund the number of programmes that
we can at the current inflation and exchange rate, but it is very
difficult, we have to continuously watch our actual budgets so that
we do not exceed available funding," said an aid worker with
an international development agency who asked not to be named.
The official exchange rate is pegged at Zim$250
to the US dollar, but on the parallel market - on which real prices
are based - it is Zim$6,000 for a greenback. Some nongovernmental
organisations (NGOs) have negotiated preferential exchange rates
with their banks to stretch their limited foreign currency.
"But not everyone is that fortunate,
not all the NGOs have the financial muscle to negotiate deals with
the banks", pointed out an aid worker. "Particularly the
local NGOs, who are small: they not only have to deal with the unrealistic
foreign exchange but also the high inflation which keeps pushing
costs up every month."
As a result even basic office equipment,
like fax toner, can cost several thousand US dollars at the
official exchange rate. "Everyone likes to keep their money
dealings legitimate, so we are very reluctant to look for deals
in the parallel market," commented an advocacy officer with
a local rights NGO.
With inflation at around 1,600 percent, nearly
80 percent of Zimbabweans unemployed, and the minimum wage no where
near the cost of a basket of basic household items, NGOs are under
tremendous pressure to provide more humanitarian assistance.
The NGOs in Zimbabwe are caught "between
a rock and a hard place", pointed out John Makumbe, a political
analyst based in the capital, Harare.
"The NGOs are operating in a war-like
situation with high inflation and an increased demand for services
related to health, social care and education ... as the government
structures have failed to provide for the shattered public,"
said Makumbe. "Yet the state prevents NGOs
from reaching out to as many people as they can afford to as they
have to use the official exchange rate and abide by other foreign
exchange regulations, unlike in real war situations."
In addition the government views NGOs with
a degree of caution, accusing some of being fronts for Western powers
hostile to President Robert Mugabe and his ruling ZANU-PF party.
According to the United Nation's Children's
Fund, Zimbabwe has the world's highest percentage of orphans - 1.6
million out of a population of about six million children. But an
international development agency, trying to provide care and
support to vulnerable children in the south of the country, has
been forced to make difficult choices as a result of the economic
Hyperinflation has eroded the traditional
role of extended families to take in orphans.
"In many areas, we are the only support
system that people have, and it can get quite tenuous when we have
to reduce the number of beneficiaries or the portion of aid they
receive," pointed out an operations manager with the agency.
"The bottom line is you have to become
very flexible, be prepared and ready to keep changing your targets
and revising your programmes," commented another aid worker.
Zimbabwe's economy has been in recession
since 2000, when the government embarked on a fast-track land
redistribution exercise that sought to give land to thousands of
people from impoverished communal areas by removing more than 4,000
white commercial farmers from their estates.
The land reform programme disrupted agricultural
production, the country's main foreign exchange earner. The government,
however, blames the economic crisis on a series of droughts,
and "sanctions" imposed by the European Union and United
States in protest over elections they deemed unfair.
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