IMF says Zim economy to contract 7.1% this year

Harare, (New Ziana) – The International Monetary Fund (IMF) said on Wednesday Zimbabwe’s economy will contract 7.1 percent this year but rebound next year with a 2.7 percent growth in gross domestic product.

The latest forecast by the Bretton Woods’ institution in its world economic outlook report, rates the economy’s performance slightly dimmer than government has predicted.

Finance and Economic Development Minister, Mthuli Ncube earlier this month said the economy was at worst expected to contract by 6.5 percent on the back of a cocktail of challenges among them drought, and shortages of foreign currency, electricity, fuel which are constraining industry operations.

The slide in Zimbabwe’s economic performance follows an anticipated slowdown in the global economy.

The global economy is expected to grow by three percent this year, the slowest since the global financial crisis a decade ago.

In 2017, it grew by 3.8 percent.

And while the IMF sees recovery in Zimbabwe’s GDP at 2.7 percent in 2020, government has put the figure at an ambitious 4.6 percent.

Government says the rebound will be on the back of an anticipated improvement in the rainfall season which should enhance agriculture production and electricity generation, with trickle-down effects to the rest of the economy.

“Implementation of reforms outlined in the TSP (Transitional Stabilisation Programme) is on course, with notable milestones on fiscal consolidation, monetary policy restoration, liberalisation of the foreign exchange market, structural and governance reforms, re-engagement, investment promotion and support for the productive sector,” Prof Ncube said.
New Ziana