Economic growth forecast revised upwards

Story by Stanley James, Business Editor

ZIMBABWE’S economy is on a growth trajectory with the Minister of Finance and Economic Development, Professor Mthuli Ncube upgrading the growth forecast for this year to more than 5% from the initial target of nearly 4%.

In his 2023 Mid-Term Budget and Economic Review statement released this Friday, Professor Ncube cited strong performance in agriculture, accommodation, and food services as well as massive improvement in electricity supply as key drivers for economic growth.

The latest growth target has also placed Zimbabwe among the fastest-growing economies in the Sub-Saharan Africa region.

An increase in cereal production, and overall growth in mining, tourism, and manufacturing are some of the key pillars cited by the treasury as key drivers for economic growth in Zimbabwe.

Treasury states that measures implemented by the government and the central bank that have resulted in the exchange rate appreciating against major currencies and easing of inflation pressures have also set the tone for growth.

Economist Dr Zack Murerwa and industrialist Mr Patrick Gwasera contend that sustained stabilisation policies are critical to consolidate gains.

“The growth trend is therefore critical moving forward actually it is there for all to see given what has transpired during the first six months and it is now that time when the focus should be on sustaining the policies to achieve growth. Remember the statistics even show that the economy is performing above regional peers so consolidating gains becomes an important element going forward,” said Dr Murerwa.

Said Mr Gwasera, “This is being felt by both the household and industrial sectors, for instance the improved electricity generation has therefore positioned Zimbabwe in a growth trajectory that will further accelerate growth while increased agricultural output has guaranteed food security with the mining sector being further expected to anchor growth, therefore leading to increased earnings abroad and achievement of positive GDP rates.”

Takeaways from the 2023 Mid-Term Budget and Economic Review include a continuous drop in inflation, a 3,5 growth projection of exports by the end of the year, and an over ZW$600 billion budget surplus in the first half.

Education is also dominating expenditures with mobilisation of over ZW$190 billion from the domestic markets and commitment by the government to achieve growth and stability objectives standing out.

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