Gold, tobacco drive export earnings

Livingstone Marufu
TOBACCO and gold continue to underline their centrality to Zimbabwe’s economy development after accounting for a combined US$1,8 billion of export earnings last year on the back of firming international prices.

Source: Gold, tobacco drive export earnings | The Sunday Mail Jul 23, 2017

Exports jumped by US$100 million to US$3,7 billion in 2016, spurred by strong performances in gold and tobacco. In 2015, Zimbabwe had achieved export revenue of US$3,6 billion. Most of the country’s exports went to South Africa, Mozambique and the United Arab Emirates.

Mineral exports grew by 6,4 percent to reach US$2,2 billion, rising marginally from the US$2,1 billion recorded in the year earlier.

Overall, exports of agricultural products grew by 4,8 percent last year from US$1 billion in 2015.

Tobacco exports topped US$933 million, which was a marginal surge from US$855 million in the previous year.

In his Budget Review presentation last week, Finance and Economic Development Minister Patrick Chinamasa said the nine percent growth in tobacco export realisations in 2016 underpinned positive performance in overall agriculture exports during the year.

In 2017, agricultural exports are expected to increase by 6,7 percent to US$1,16 billion driven led by tobacco and sugar.

Minister Chinamasa said strong production performance, coupled with firming international prices for the platinum group of metals, diamonds and nickel, are also expected to push mineral exports to US$2,3 billion this year.

Last year, gold exports topped US$913 million on account of improvements in both production and international prices.

Exports of finished manufactured goods also increased, recording US$183 million in 2016 compared to US$175 million of the previous year.

The finished manufactured goods included foodstuffs, furniture, building materials, chemicals, packaging materials, footwear, and plastics.

However, Minister Chinamasa said challenges were experienced with exports of semi-processed products as ferro-alloys and cotton lint due to a decline in production and depressed international prices.

With the support extended to cotton farmers by Government, coupled with firming metal prices, exports of semi-processed goods are projected to markedly improve this year.

Revenue from manufactured products are expected to rise to US$363 million by end of 2017 from US$320 million last year.

The current account deficit, benefitting from improved exports and declining imports, is estimated to have narrowed to US$552 million from US$1,5 billion in the comparative period.

This year, total exports are projected to reach US$3,9 billion on account of another strong performance in agriculture and mining sectors, especially tobacco, PGMs and nickel.

Meanwhile, imports also dropped by 15 percent to US$5,2 billion from US$6,1 billion due to a cocktail of measures put in place by Government to spur local industry growth.

In July last year, Government promulgated Statutory Instrument 64 to promote local industry production.

Command Agriculture was also launched as part of measures to reduce grain import costs by close to US$300 million.