As Zimbabwe's economic and political crisis deepens, corruption levels in the troubled southern African country have soared, a watchdog said yesterday.

Transparency International Zimbabwe (TIZ) said millions of Zimbabwe dollars were fleeing the country while a dual pricing system for government entities and the rest of the population was fostering a burgeoning black market for scarce goods like fuel and maize.

"The breakdown of the rule of law is a major contributor to the escalation of corruption in Zimbabwe," TIZ chairman John Makumbe told a press conference.

Zimbabwe is in the throes of a severe economic crisis with inflation at 455,6% and unemployment at around 75%.

While many basic goods are unavailable at supermarkets, they are readily available on the parallel market at much higher prices.

"We are seeing the black market, rather than shrinking, expanding," Makumbe said.

The TIZ chairperson, who was speaking at the end of a one-day national anti-corruption conference, said the economy was being "stripped of its assets" by corrupt practices both in the private and government sectors.

"We are aware that millions, if not billions of Zimbabwe currency is being externalised," Makumbe noted.

Chronic cash shortages in Zimbabwe have recently been alleviated by the introduction of a new form of currency - bearer cheques.

But bank queues have begun to resurface amid reports that the cheques, like the traditional bank notes, are being taken out of the country where they are used to buy foreign currency for resale on the black market back home.

Foreign currency such as the US dollar can fetch up to seven times its official rate of one US dollar to 824 Zimbabwe dollars on the black market.

Zimbabwe has recently plummeted in Transparency International's corruption index to a rank of 106, with only 27 other countries considered more corrupt.

In 1998 it was ranked 43. – Sapa-AFP.