Zimbabwe

This paper reviews the performance of
the parastatal sector, with a specific focus on four main
parastatals: the Zimbabwe Electricity Supply Authority
(ZESA); the Zimbabwe Water Authority (ZINWA); the National
Oil Company of Zimbabwe (NOCZIM); and the Grain Marketing
Board (GMB). These parastatals are selected on the basis of
their quasi-fiscal dependency and strategic importance to
the economy. The specific objective of this paper is to
identify the important factors behind their eroding
profitability as observed in their financial statements, and
make some preliminary thoughts about the way forward. This
paper was prepared based on the data provided to a World
Bank team, supplemented by information collected through
interviews with the representatives of parastatals, the RBZ,
the Ministry of Finance, line ministries and the private
sector in November 2007. The statistics presented in this
paper should be interpreted with extreme caution. As prices
are heavily distorted in the presence of extremely high
inflation and pervasive price controls, analysis of
quasi-fiscal data and parastatals’ financial performance has
posed a significant challenge to the team. While every
possible effort was made to address such distortions,
analysis largely based on annual data cannot possibly
capture a fully accurate picture, and should therefore be
taken with caution.