THE World Bank has painted a gloomy picture of Zimbabwe’s economic prospects this year saying the country is not likely to benefit from the rebound forecast for other sub Saharan African countries.
Report by Victoria Mtomba
Speaking at the Mandel Gibs Economic Outlook Symposium yesterday, World Bank senior economist Nadia Piffaretti said African economies were expected to grow at an average of 5% this year.
Foreign direct investment inflows (FDI) into the sub Saharan Africa region are expected to reach $91 billion.
“Zimbabwe is getting peanuts out of it,” she said.
The country’s FDI in 2011 stood at close to $400 million, but for countries such as Angola, South Africa and Zambia it was above
Pifarretti said Zimbabwe was not taking advantage of the global boom in mining as the sector was still recovering.
“The mining sector is still recovering. The country was not able to take full advantage of the global boom in mining prices,” she said.
“In the baseline scenario, we project maximum $5 billion investment by 2018. Most production volume would expand in gold and coal with 5 000 new jobs created. In the active policy scenario, investment could reach $15 billion, with 30 000 jobs created.
“Gold, coal and chrome have high potential of absorbing new investment.”
Piffareti said lower growth rates exacerbated vulnerability to internal and external shocks.
However, Economic Planning and Investment Promotion minister Tapiwa Mashakada, who spoke at the same symposium, had a different view about Zimbabwe’s economic growth prospects for this year.
“I am seeing 2013 as a watershed year, as a game changer,” he said.
“This year, even beyond 2013, I can assure you that the use of multi-currency should continue.”
Mashakada said there had been positive changes in the country after International Monetary Fund released to Zimbabwe technical assistance that had been suspended for a long time.
“Very soon, the European Union will be reviewing sanctions for Zimbabwe,” he said. “We expect a positive review of sanctions by the EU.”
Zimbabwe registered the lowest growth rate of 4,4% in 2012 compared to the previous three years after the country adopted the multi-currency system.
The growth rates for for 2009, 2010 and 2011 were 5,4%, 9,6% and 10,6% respectively.
“(The year) 2012 was the climax of the rebound. We started to see serious problems with our growth. The agricultural sector did not do well and there was moderate growth in mining sector,” Mashakada said.
Mandel Training centre together with Gordon Institute of Business Science (Gibs) in Pretoria has been running the symposium since 2010.