Cash crunch may hamper access to govt relief funds

Although supplies of basic commodities have improved on both the parallel and formal markets, most urban-based Zimbabweans cannot afford the cost of all their household food needs, the Famine Early Warning Systems Network (FEWS NET) said in its latest report. "The majority of market-dependent households cannot afford to meet all of their food needs, given their limited incomes and the extremely high prices at which these commodities are trading. Price controls have failed to arrest price increases and protect the poor from the ever-escalating prices," noted FEWS NET's monthly update report, issued on 18 August. The availability of basic items such as bread, maize meal and maize grain improved in most urban centres in August, but are sold for much more than the government-stipulated price. In the case of maize meal, the price differential is over 590 percent. As a result, "the cost of living for all sections of the urban poor continues to increase, seriously compromising food security for this group," FEWS NET said. In response, the government has disbursed the first Zim $857 million (US $1 million) tranche of the Zim $12.5 billion (US $15.2 million) allocated to rural and urban councils for food relief. The programme is intended to cover the needs of 3.1 million people, providing Zim $10,000 (US $12) per month to recipients enrolled in public works programmes, and direct payments to the elderly, chronically ill, the disabled and child-headed households. The payments will be just enough to purchase a month's supply of maize grain for an average-sized household at the parallel market rate outside of the drought-prone south of the country. "If the GMB [Grain Marketing Board, a parastatal monopoly,] continues to supply food at subsidised prices, increasing the volume and frequency of these supplies over time, and if the food relief is paid regularly, the food security situation will certainly improve in the targeted areas," FEWS NET observed. However, an aid worker told IRIN that in view of Zimbabwe's current dire shortage of banknotes and fuel, the government's disbursement of these funds to the councils would only be the first step. "How do you get the cash out? If the bank has no banknotes and there's no fuel, it will just be a bunch of noughts in the cheque account of the local councils." The World Food Programme and the Food and Agriculture Organisation estimate that 5.5 million Zimbabweans will be in need of food aid by January 2004. To view the FEWS NET report click on: www.fews.net