via Zimbabwe’s economic future uncertain – World Bank
THE World Bank has said the 2014 outlook for Zimbabwe’s still ailing economy remains increasingly uncertain due to a host of internal and external factors.
In its September Economic Briefing, the bank said growth in Zimbabwe was rapidly fading, and after 4, 4% recorded in 2012, the growth projections for 2013 have been revised downwards to 3%, with little prospects for a recovery in 2014.
“The economy faces uncertainty both from expected volatility in the global economy, and on the domestic front after July elections, amidst worsening macroeconomic indicators and increased vulnerability of the banking sector,” the bank said.
As Zimbabwe’s external position has been supported by substantial short-term capital inflows, the situation would be compounded by the risk of capital outflows from emerging markets, as the United States Federal Reserve progressively unwinds its expansionary monetary policy.
“Growth performance has been stymied by continued slowdown of the key sectors of the economy, amidst easing of international commodity prices, low investment, tight credit conditions, and policy uncertainty after the July elections,” the bank said.
The briefing also noted that concerns over the new government economic policies, including extensive implementation of indigenisation legislation, were bound to extend the wait-and-see attitude of both domestic and foreign investors that characterised the run-up to elections.
The expected increased volatility of commodity prices would affect Zimbabwe’s export growth, worsening the current account deficit, shrinking fiscal revenues and upsetting the economic recovery process.
Agriculture’s growth prospects have been revised downwards and the sector is expected to slightly contract by -0,3% while the decline in international prices is dampening growth of the mining sector.
Zimbabwe’s manufacturing sector growth is projected at 1,5%, stunted by low investment, declining competitiveness amidst tight credit conditions and the services sector will remain the biggest contributor to Gross Domestic Product, at 41%.
The bank said that as fiscal revenues stabilise around US$4 billion, Treasury can no longer keep the pace of the past fiscal recovery to absorb new commitments.
Zimbabwe’s external position remained under pressure in 2013.
National statistical agency Zimstat’s data showed that exports reduced to US$1,55 billion in the first six months of 2013 compared with US$1,56 billion in 2012 with mineral exports and tobacco contributing towards the bulk of exports.
COMMENTS
let it be so What a man sowest so shall he reapest You can cheat the economy can you mastermind lets see you cheat the economy and good luck have 122%
COMRADES only know how to plunder, never to build. They cannot also build. It took Smith 15years under war and UN sanctions to build the infrastructure here, including the towns and cities.
Comrades have only ammassed farms and houses for themselves. They steal not just elections, but minerals, tax revenues etc. to finance the lavish lifestyles. Smith had just 2 cars escorting him during a raging bush war. They have fleets of 50 plus motorbikes and unmarked cars, plus a battallion of soldiers! Nxaaaa mhani!
Gora you’re on point there. What are these comrades so afraid of if they’re such popular people. They say the guilty are afraid!
Parastatals need to stop draining the fiscus. They need to start being independent and contribute to the economy. Air Zim should introduce budget flights between SA and Bulawayo/Harare. They must position themselves as competing against road transport in that vein also increase the traffic to Zimbabwe. If the airfare from Joburg to Harare can cost as little as R 800 same as Joburg Capetown more people would travel to and from Zimbabwe and thereby increasing cashflow to the country. A boeing 737 will cost about $25 000 per 1 way trip with a sitting capacity of 300 and at $100/ticket $ 30 000 revenue per trip. At such low ticket prices we will definitely have more travelers and therefore more flights. We could be having 4 or more flights per day from 1 plane (i dont know the limitation on takeoffs/landings). Then comes the gist of it all. Each traveller will spend at least another $200 or so in our economy, purezha, kumariro, kuzo vaka, kuzoona van varikuchikoro meaning 1 Air Zimbabwe plane will contribute $90000/trip/day equivalent to 360 000/day x 365 aprox $ 100 million/year. I know this is oversimplified but the problem we only look at Air Zim as a seperate entity without looking at the whole picture, same with indeginisation and many other facets of our society. Besides who really needs a meal on a 1 and 1/2 hour flight, it really boggles the mind.
It is articles like this that make me think that the finance houses in Wall street and the city of london, were the real enemies to Rhodesia and now Zimbabwe.The capitalist western world does not care about Zimbabwe, nor will it ever.