THE Ministry of Economic Planning and Investment Promotion has revised downwards the country’s economic growth rates for 2013 to 5,2% from an initial projection of 6,6%.
Report by Bernard Mpofu Chief Business Reporter
The ministry said more reforms were required to stimulate the performance of the economy.
According to the first Medium Term Plan (MTP 2011-2015) implementation progress report, failure by Zimbabwe to attract significant foreign direct investments, a huge debt overhang, infrastructure bottlenecks and late disbursements of funds from Treasury will slow down economic growth.
The MTP — the country’s first economic blueprint since the formation of the inclusive government in 2009 — was launched last year with a view of formulating policy which stimulates economic growth.
The main target of the blueprint was to ensure that the economy remains on a sustainable growth path, with average a real gross domestic product (GDP) growth rate of 7,1% during the plan period.
“The growth of the economy is projected to slow down to 4,7% in 2012 which is lower than the MTP target of 7,8% in 2012,” Economic Planning minister Tapiwa Mashakada said yesterday.
“The slowdown in economic performance in 2012 is largely attributed to poor performance of the agriculture sector.
“More robust strategies are however required to deal with the myriad of challenges that are threatening to derail the sustained growth of the economy.
“The MTP singled out infrastructure rehabilitation and restoration of electricity generation as the foundation for economic growth and development.”
Cluster groups, which rated the performance of the MTP save for the African Development Bank said the blueprint had averaged 50% on its scorecard during its first year of review due to financing constraints.
The regional bank said the policy document had to date only achieved three out 10 of its objectives due to financing problems linked to the country’s growing debt, now estimated at $10 billion.
But the ministry projected that the country’s export earnings would nearly double to $5,2 billion in 2013 from an initial target of $2,9 billion spurred by mining exports.
The report also envisages the economy to maintain single digit inflation figures.
“The MTP targets to improve the overall balance of payments of the country with a current account balance (as of GDP) projected to improve from -11% in 2011 to -3% in 2015,” read part of the report.
Already, Finance minister Tendai Biti, who is expected to present the national Budget on Thursday has cut GDP growth rates for the current fiscal year to 4% from 5,6% due to the poor agriculture output and underperformance of diamond revenue.