Observers say Zimbabwe economic situation set to worsen in 2016

via Observers say Zimbabwe economic situation set to worsen in 2016 | ZimDaily 27/12/2015

ZIMBABWE – Observers say the economic situation in Zimbabwe is likely to worsen next year.

One of the observers, Rejoice Ngwenya, who is an independent economic commentator, told that the country needs to adopt strict measures to kick start the ailing economy, which recorded a marginal growth of 1.5 percent this year.

“The answer lies in that sectors that enable economic development are put in place. We need to resolve the energy crisis and once that is resolved then we focus entirely on to do business environment which means all these political hurdles, which means all these political mandarins like Zhuwawos (Indigenization Minister Patrick Zhuwawo) of this world they need to be reigned in so that we come to a scenario where we attract international interests – the IMF and other investors.”

He said Zimbabwe may face worse economic problems next year compared to 2015 if such measures are not taken to stimulate growth.

His views were echoed by several economists, who argued that the country is expected to record a negative growth due to lack of strong economic fundamentals promoting the generation of competitive exports.

But London-based Zanu PF member, Nick Mangwana, said the economy is expected to improve in 2015.

“The projections for Zimbabwe are primarily based on the deals signed with Chinese. We need a full operationalization and the culmination of those deals because once the infrastructure has been set up then Zimbabwe is on a good path to recovery.”

The so-called mega deals signed by China and Zimbabwe include the recapitalization of Hwange Thermal Power Station and rehabilitation of crumbling critical infrastructure in the country.

But critics say these deals will not directly benefit members of the public currently facing serious socio-economic problems.

Reacting to these suggestions, Mangwana said, “I don’t agree with those suggestions … I think they are parochial and myopic to say the least. The deals are focused on infrastructural development and infrastructure is an enabler of economic recovery.”

Mangwana added that there is hope that Zimbabwe will continue re-engaging the West in order to attract the much-needed foreign direct investment.

“Zimbabwe cannot afford to have enemies, so the more friends we have the better for our country. Those are the caveats for the success of Zimbabwe.”

Finance Minister Patrick Chinamasa has projected that the local economy will record remarkable growth next year propelled by Chinese investment in Zimbabwe and the rebounding of key sectors like agriculture and mining.