By Ndanatsiwa Tagwireyi
ZIMBABWE will this year experience a 7.8% Gross Domestic Product Growth, up from a decline of 5.3% in 2020, the Apex Bank Deputy Governor Dr Kupukile Mlambo has revealed.
Speaking at the just ended 2021 CEO Africa Annual Roundtable and Awards ceremony held at the Elephant Hills Resort in Victoria Falls, Dr Mlambo said the sustained economic growth will be on the back of a good rainfall season for 2020/21, good sectoral performance, a stable macroeconomic environment and positive external factor performance.
“This year and going forward, we have seen the economy beginning to take off. But what is behind this growth rate? We have natural factors, the good rainfall patterns that we had last year and those we are going to have this year,” Dr Mlambo said. “The projections that we are getting from the Ministry of Agriculture and the Ministry of Finance is that this year, the agriculture sector will grow by 36.2% and 6% in 2022.”
According to Dr Mlambo, electricity generation is projected to grow by 19.2% in 2021 and 12.2% in 2022 while the construction sector will grow by 7.2% in 2021 and 5.0% by May 2022. In his remarks, Zimbabwe is recovering from the shocks catapulted by the COVID-19 pandemic, cyclone Idai and policy revamps in 2019 and 2020.
“So, we had two consecutive years of negative growth rates but also that time we were going through a policy revamp of some sort and therefore the performance reflected a policy revamp that was taking place especially in 2018 and 2019,” RBZ deputy governor said adding that: “There were a lot of policy changes that were taking place and industry and business needed to react to that.”
He underscored the importance of the current policy environment being created in contributing immensely to sustained economic growth. The deputy governor noted that good climatic factors are not in enough if policies are not responding to promoting the ease of doing business in the country.
“The main policies in the macro-economic environment are the monetary policies and the fiscal policies which provide a supportive conclusive policy environment,” Mlambo said. “Monetary policies can actually anchor your inflationary expectations.”
Dr Mlambo also paid tribute to external factor performance in driving the projected economic growth in Zimbabwe.
He said: “We expect that this year we are going to get the highest foreign currency inflows so we are really in a good trajectory coming from exports receipts which account for about 60% of our foreign currency earnings.”
“We have a very good performance of diaspora remittances up between January and 13 October 2021, we have received just over a billion dollars’ inflows from diaspora remittances. This is despite the COVID-19 pandemic”
“In total, now we are standing at $7.1 billion in terms of foreign currency inflows.”
This article was also published in the November Issue of The Entrepreneurial Magazine