The International Monetary Fund (IMF) predicts that South Africa and Zimbabwe will have the same economic growth rate of 0.8% in 2020.
The IMF on Wednesday revised its outlook for Zimbabwe from 2.7% to just 0.8% this year. Meanwhile, the Zimbabwean government expects a growth of 3%.
In January, the IMF also revised its expected growth rate for South Africa down to 0.8%.
According to the IMF, “structural constraints and the deterioration of the state’s finances hold back business confidence and private investment”.
In the case of Zimbabwe, the IMF says the country is facing an economic and humanitarian crisis compounded by poor policies and climate-related shocks.
“With the poor crop expected, (economic) growth in 2020 is expected to be almost zero, with food shortages continuing.”
The latest revision comes after the recently re-used Zimbabwean dollar lost much of its value.
According to the Zimbabwean Board of Public Accounts and Auditors, hyperinflation hit the country in October last year after prices rose sharply.
Electricity is now 300% more expensive.
In addition to high inflation and low international reserves, the IMF has indicated that it is essential for Zimbabwe to address its governance and corruption challenges.