COVID-19 national lockdown critically affects livelihoods and sharply increases food needs

• The COVID-19 pandemic severely threatens an already critical food security situation arising mainly from the prevailing poor macroeconomic conditions and consecutive years of drought. The movement restrictions associated with COVID-19 have significantly impacted businesses and urban and rural livelihoods, further limiting household incomes. This has led to a higher than previously anticipated food insecure population, especially in urban centers. Humanitarian food assistance currently is preventing more severe food security outcomes with Stressed! (IPC Phase 2!) outcomes present across most of the country. However, Crisis (IPC Phase 3) outcomes are present elsewhere in the country.

• The government declared an extension of the initial 21-day national lockdown, which started on March 30, by two weeks through May 3. This lockdown is in response to the ongoing COVID-19 pandemic and aims to limit the spread of the disease. As a result of the lockdown, the movement of people and goods has been restricted. Most livelihood activities in urban and rural areas, both formal and informal, have been severely affected.

• Following the harvests in May, short-lived improvements to Stressed (IPC Phase 2) outcomes are expected in surplus-producing areas; however, in deficit-producing areas, Crisis (IPC Phase 3) outcomes are expected to persist, driven by the poor harvest, continued macroeconomic challenges, and the impacts of COVID-19. It is expected that some worst-affected households are likely to be in Emergency (IPC Phase 4).

• The government in early April issued a new policy to allow the use of the US Dollar for local transactions again alongside the local currency. Following this, the Zimbabwean Dollar (ZWL) continued to devalue, depreciating by about 20 percent in April. Consequently, prices of most goods and services continued to increase in ZWL terms during the month. The national lockdown-related panic buying has also led to increased commodity shortages and prices in the country.

On March 30, following a presidential declaration, Zimbabwe entered a 21-day nationwide lockdown to prevent the spread of COVID-19. The lockdown was extended in mid-April for two weeks through May 3. Despite the lockdown the number of confirmed positive cases of COVID-19 continues to increase. As of April 29, according to the Ministry of Health and Child Care, a total of 40 confirmed cases and 4 deaths were reported. As part of the lockdown, national borders are closed except for formal imports of essential goods such as food and medical supplies, as well as for returning citizens. Additionally, stringent internal movement restrictions are being enforced except for essential services such as the food industry, health, and security.

Security forces are enforcing lockdown measures to ensure people stay at home and most businesses and markets remain closed across the country. The government loosened some restrictions allowing for major urban markets to function with some limited level of commerce. Many informal sector operations have come to a near standstill. Supply chains especially for perishable products from rural to urban areas were largely disrupted and continue to operate at below normal levels. Some sections of the formal sector laid off staff or closed business completely. The Confederation of Zimbabwe Industries reported that over 80 percent of local businesses cannot afford paying staff if the lockdown is extended further.

Immediately after the announcement of the lockdown, many urban poor moved to rural areas, increasing the strain on already weak rural food and labor markets. Additionally, some illegal structures belonging to small and medium enterprises and informal traders have been destroyed across the country as the government is trying to organize this sector. This is likely to have long-term impacts on the informal sector and the ability for populations reliant on this income source to access it. The ban on all public transport (except for essential services and staff) affected most livelihood activities with little free to no free movement within the country, even within communities. Moreover, local and international remittance flows have decreased across the country. Incomes from the agriculture sector are also below average and limited across much of the country.  

The Zimbabwe National Statistics Agency (ZIMSTAT) reported annual inflation for March at over 675 percent, up from 540 percent in February. Independent analysts estimate inflation is almost double those rates. Fuel prices increased by around 15 percent early in the month despite a global dip in prices. ZIMSTAT also reported a 13 percent increase in the food poverty datum line[1] for March compared to February, and a 21 percent increase in the total consumption poverty line[2] for the same period.

Shortages of some basic commodities on the markets have continued especially for maize meal with desperate households spending hours in long lines to purchase scarce subsidized maize meal. Subsidized maize meal sells at 70 ZWL/kg at supermarkets and some retail shops. On the parallel market maize meal prices are up to 4 to 5 times higher and are unaffordable to many poor households. In late-April the government, after agreeing with main industry bodies, announced a price freeze on basic food commodities to the March 25 levels. Despite this, prices for most commodities have not reduced but continue to increase. In response to the inflationary environment, the government has also increased the maize and traditional (small) grains producer prices for the 2020/21 marketing season by over 56 percent from last season’s prices.

In early April, the government allowed the use of the US Dollar again for local transactions; however, the US Dollar to Zimbabwe Dollar (USD/ZWL) parallel market exchange rate continued to increase in April (Figure 1). Most goods and services have increasingly been charged in USD, yet most incomes are still in ZWL. Cash, mobile money, and electronic transfer prices in local currency are priced above prevailing parallel market rates. Most incomes are very low for poor households to exchange ZWL to USD at the galloping parallel market rates to purchase enough basic food in USD to meet their needs.

The harvest of early planted crops has started, although at below average levels, improving food consumption for some households. The 2020 tobacco selling season opened in late-April after being postponed by about a month for appropriate measures to be put in place to limit the spread of COVID-19. The water and pasture situation in most arid areas is deteriorating fast and atypically early for this time of the year following a third consecutive drought. Livestock (mainly cattle) condition is poor and livestock losses continue to be reported in some areas which is atypical for this time of the year, impacting household livelihoods and incomes.

WFP and partners reached about 3.7 million people in April across the country with humanitarian food assistance as part of the Lean Season Assistance Program. As a result, most areas of the country are experiencing Stressed! (IPC Phase 2!) outcomes. However, in areas where assistance is low, or where there is no assistance at all, Crisis (IPC Phase 3) outcomes are present. In addition, some of the worst-affected households not targeted for assistance or in areas with no assistance are likely experiencing Emergency (IPC Phase 4) outcomes.

The assumptions used to develop FEWS NET’s most likely scenario for the Zimbabwe Food Security Outlook for February to September 2020 remain unchanged except for the below:

• Based on available information, the COVID-19 pandemic is likely to continue in the near to medium term, and an increasing number of positive cases are likely due to both the spread of the virus and increased testing. While it is difficult to predict how long the pandemic will prevail and its severity, it is anticipated that the effects on food and income sources will persist through at least the end of the year.
• Government revenues are expected to drop significantly as exports, businesses, employees, and general public expenditures are also expected to decline. Notable sectors to be affected are the tourism and hospitality, manufacturing and transport sectors. 
• As of April 30, the government has not made an announcement on the way forward after the current lockdown. FEWS NET anticipates that as is the case elsewhere, the government may lift some restrictions while maintaining others in the short- and medium-term to prevent the spread of the disease. Some businesses will most likely only partially resume operations while others are likely to be permanently closed. The Zimbabwe National Chamber of Commerce estimates that 75 percent and 25 percent of jobs in the informal and formal sectors respectively will be lost due to the pandemic. This poses long-term socioeconomic challenges, especially in urban areas.
• International and domestic remittances are expected to be lower than earlier projected in response to disruption of livelihoods internationally and locally, impacting both rural and urban household incomes, especially in southern areas bordering South Africa.
• Even after the lockdown is lifted, some cross-border movement restrictions are likely to be upheld by Zimbabwe and its neighbors. This will most likely lead to lower levels of commerce for small businesses including cross-border trade, petty trade, and most of the informal economy.
• As most countries internationally and regionally implement restrictive measures against COVID-19 some regional and local supply chains will likely occur at below normal rates, negatively impacting both formal and informal businesses. Prices are likely to continue to be guided by the parallel market rates and combined with the likely continued shortages of some basic commodities, this will likely lead to continued price increases (Figure 2).
• Most urban poor who moved to their rural homes following the pronouncement of the national lockdown are unlikely to return to urban areas. This will be an additional burden to rural livelihoods and support systems. This is likely to further reduce labor opportunities and labor rates compared to what was previously anticipated as the result of above average labor supply. 
• The authorization to use the USD, meant to facilitate transactions during the lockdown period, is anticipated to be extended beyond the lockdown period. This will likely result in the further devaluation of the ZWL. The USD: ZWL parallel market exchange rates are likely to continue increasing affecting the economy. This will likely be worsened by declining foreign currency earnings, promoting the black market.
• WFP has reported plans to extend humanitarian food assistance in May and June to between 1.3 million and 1.5 million people. However, as details are not available at district level, the impacts of humanitarian food assistance for May and June were not incorporated into this analysis. 

The population in need of humanitarian food assistance especially in urban areas is likely to be higher than previously anticipated throughout the outlook period as the result of the impacts of COVID-19 restrictions and the associated loss of income coupled with the poor macroeconomic conditions and consecutive years of drought. Humanitarian food assistance currently planned for April is expected to maintain Stressed! (IPC Phase 2!) outcomes across much of the country through May, whereas Crisis (IPC Phase 3) outcomes are anticipated in areas where food access is still poor.

Most typical rural and urban income sources are expected to remain low during the outlook period through September. Below-normal labor opportunities and other income sources and increasing prices are expected to drive poor households purchasing power. In many areas the main harvest is expected to be limited and poor; however, many poor households are expected to consume own foods for 1 to 2 months in many typical deficit areas and 2 to 4 months in typical surplus areas. This will improve household food access and stabilize food security in rural areas for a limited time.

Surplus-producing areas of the country are expected to be in Stressed (IPC Phase 2) following the harvest. However, most deficit-producing areas of the country are anticipated to be in Crisis (IPC Phase 3). Some households especially in deficit producing areas are expected to continue employing livelihood and consumption coping measures such as borrowing food, skipping meals, and reducing meal portions. In extreme cases, some households that are not expected to have a harvest with extremely limited livelihoods are expected to face Emergency (IPC Phase 4).  It is likely that some households will experience larger food gaps than previously anticipated though these are still expected to be indicative of Crisis (IPC Phase 3) outcomes with more households falling into Emergency (IPC Phase 4). However, it is not likely that at least 20 percent of the population in worst-affected areas, mainly in the south and west, would fall into Emergency (IPC Phase 4) for these areas to be classified as Emergency (IPC Phase 4).