Communication in Economics - Essay Example

It warned about its rampant inflation, unemployment, high rates of interests and soaring poverty. It feared that economy would worsen and collapse in the absence of strong and effective measures. The interest rate was on a record of seventy percentages in year 2005 while the inflation was more than three hundred and fifty percentage. This indicates the poor condition of economy of Zimbabwe. The International Monetary Fund warns that Zimbabwes gross domestic product will likely shrink another seven percent this year.

In addition, some economists predict that by years end inflation could reach 1,000%. (Franceschi, 2005) Companies are shutting down, unemployment is increasing and there is shortage of food. The productivity has decreased. This resulted in various social problems like increase in crime rate, illegal immigration to other countries, increased corruption and many others. There are various political, economic and social reasons of Zimbabwe’s economic crisis. These range from leadership to corruption within the society.

The causes of the country’s economic distress are as follows: “Among the problems most often cited are Mr. Mugabes land re-distribution policies, endemic corruption, the absence of the rule of law and Zimbabwes involvement in Congos civil war.” (Franceschi, 2005) There has been fuel shortage that influenced the industries adversely. The shortage of fuels has direct impact on the productivity and transport. It also affected the employment sector. The shortage of fuel has an impact on employment sector as well.

It resulted in unemployment of many. The expenditure in government activities is suffering with unscrupulous spending and corruption. Government is ignoring the need to control the state expenses. The supply of currency within the economy is high. This is resulting in decrease in the value of currency. One of the important issues resulting in economic crisis is decrease in the level of foreign direct