Future of the economy becomes more and more creepy now

Zimbabwe celebrates the 34th anniversary of its independence on Friday amid concern that the deteriorating economy is eroding the gains of independence. Zimbabwe gained independence from British in 1980 after a vicious war between the white Rhodesians and black freedom fighters. At independence, the country was the bellwether of economic promise and good governance but that faded at the turn of the millennium.  Vowing to end social inequality and racial oppression, Zimbabwe's first prime minister and current president, Robert Mugabe, proclaimed a new era in the nation's history, but the promises and hopes of independence are yet to translate into sustained economic growth. A costly military venture into war-torn Democratic Republic of the Congo - then named Zaire - and overdue compensation pay outs to war veterans marked the beginning of economic collapse in November 1997, when the Zimbabwe dollar lost more than 70 percent of its value.

At the turn of the millennium, a political crisis and a land reform programme that violently seized white-owned farms resulted in a significant reduction of agricultural productivity and mass withdrawal of foreign investment. Although farming yields eventually increased, the shattered economy and volatile political situation prompted many Zimbabweans to seek political refuge and a better life elsewhere. Zimbabweans have dispersed all across the continent, with a concentration residing in South Africa. Estimates of the number of Zimbabweans here range between 1.5 million and 3 million, but a large number are undocumented migrants who left in search of employment and a better standard of living. A condition partly caused by on-going liquidity problems in the banking sector, as well as donor and investor uncertainty over the credibility of 2013's presidential and general elections, the shrinking economy has resulted in economic deflation. Recent figures from the International Monetary Fund show inflation has declined from 2.9 percent in 2012 to -0.5 percent in February 2014.

While it's the first time Zimbabwe has experienced deflation since adopting the multiple currency system in 2009, when record sky-high inflation levels forced the government to abandon the Zimbabwe dollar in favour of currencies such as the US dollar and the South African rand, analysts have warned Zimbabwe could face more financial challenges if poor economic performance continues. Voicing those concerns is the former Minister of Finance and Secretary-General of the opposition MDC-T party, Tendai Biti. He blames the Mugabe government for poor management of the economy. "The current situation proves that the Zanu-PF regime cannot be trusted with management of the economy. We have now entered into a serious period of deflation and this could lead to the total collapse of industry and an increase in corruption and social suffering as people struggle for the few resources that are available," he told Al Jazeera.

Biti said that protracted deflation could lead to the return to the Zimbabwe dollar. "Faced with absence of economic growth and debt repayment problems, it might be likely that a return to the Zimbabwe dollar is inevitable." In its 2013-2015 Country Brief for Zimbabwe, the African Development Bank (AfDB) urged the government to improve administration and revenue collection from the country's mineral wealth - as this could potentially provide some debt relief for the state and, in turn, the general population.