Zim set for rebounding incomes 

Source: Zim set for rebounding incomes – DailyNews Live

Financial Gazette      8 August 2018

HARARE – Zimbabwe is expected to experience rising income levels in the
near future leading to a rise in consumer spending due to a rebound in the
economy, a local equities research firm has said.

In its Consumer Sector report for 2018, IH Securities (IH) said while
Zimbabwe’s GDP per capita remained well below peer sub-Sahara African
countries – despite rising from $1 004 to $1 112 – consumer spending was
set for a boom with spending driven by consumption in rural areas as
agriculture is projected to grow 10,7 percent in 2018.

“Furthermore, rising income levels in rural areas would trickle down to
urban agri-value addition businesses, and thus increasing the average
customer spend in urban areas as well,” IH said.

The agriculture sector contributes about 12 to 15 percent to GDP,
employing close to 30 percent of the country’s working population and is a
major source of livelihood for more than 80 percent of Zimbabweans.

The 2017 year saw a spiralling of weak economic fundamentals characterised
by huge imports versus low exports, subdued production capacity, low
foreign direct investments, low incomes and high unemployment, a rise in
multi-tier pricing which translated to inflationary pressures, a weak
banking system which aided in currency premiums and a fiscal position
reflecting unhealthy government spending.

Salaries and wages in Zimbabwe received regularly and irregularly were the
highest sources of income in 2017 at 30 percent while income from other
family members and own business were at 28 percent each, according to IH.

“The average monthly household income for August 2016 was estimated at
$289,51 compared to average expenditure of $227,53 (about $63,58 is spent
on food), this was below the poverty datum line of $477,12. It must
however be noted that 80,6 percent of total households experienced loss of
employment or income source during the period.

– The Financial Gazette