Zimbabwe’s growth prospect is expected to slow down to 3.5 percent this year from the seven percent recorded in 2021, the International Monetary Fund said on Tuesday.
In a statement at the end of a staff visit to Harare, the IMF team led by Dhaneshwar Ghura said
Zimbabwe’s economy has been affected by significant shocks such as Russia’s war in Ukraine, the poor 2021/22 rainfall season and price pressures.
Renewed price and exchange rate depreciation pressures have emerged in the second quarter of 2022, with inflation in August reaching 285 percent over a year earlier, Ghura noted.
“After rising to about 7 percent in 2021, real GDP growth is expected to decline to about 3.5 percent in 2022, reflecting a slowdown in agricultural and energy outputs owing to erratic rains and rising macroeconomic instability, amidst a recovery in mining and tourism,” Ghura said.
He, however, said, uncertainty remained high and that the outlook would “depend on the evolution of external shocks, the policy stance, and implementation of inclusive growth-friendly policies.”
“In this regard, the recent tightening of monetary policy and the contained budget deficits are policies in the right direction and have contributed to the narrowing of the parallel market exchange rate gap.”
JN/APA