Harare - The Zimbabwe Stock Exchange tumbled to its lowest level in six years as the ruling Zanu-PF party continued to fight internal wars.
By the close of trading on Tuesday, the main Industrials index stood at 99.80 points, the first time it has closed below 100 points in six years.
The last time the ZSE closed at these levels was on April 24 2009 when it closed the day at 98.64 points.
Sentiment on the ZSE is highly negative as listed companies continue to record falling revenues and profitability.
Most Zimbabwean companies are losing out to competition from neighbouring countries, where weakening currencies are encouraging exports into dollarised Zimbabwe.
Recently Nampak Zimbabwe said the falling rand and the Zambian kwacha were encouraging the proliferation of imports into Zimbabwe, which uses US dollars.
“One of the areas of most concern to our group at present is the proliferation of imported products, particularly coming out of South Africa and Zambia, as both the rand and Zambian kwacha have seen material devaluations,” said Nampak Zimbabwe CEO John van Gend.
He added that the development will continue to have a material effect on both volumes and margins in certain product areas of Nampak Zimbabwe’s business.
No sign of turnaround strategy
As economic fundamentals continue to deteriorate, the Zanu-PF government is showing no signs of coming up with strategies to turn the economy around.
Most of government’s energy is now spent on fighting factional wars that have culminated in President Robert Mugabe’s wife Grace Mugabe accusing soldiers and top Zanu-PF officials, angling for power, of plotting to kill her son.
Mugabe also claimed party officials might have killed "dozens" of orphans living in an orphanage she runs next to her dairy in Mazowe, had they not been found out by the authorities.
With such accusations being thrown around, chances are that government’s efforts will be spent on disproving them, leaving the economy to deteriorate further.