Credible elections will see GDP grow 6,5% by year-end

SOUTH African firm Emergent Research says a clear winner and a clean election will see the gross domestic product (GDP) grow to 6,5% by year end.

BY TATIRA ZWINOIRA

Emergent Research is an investment research and advisory firm, which also hosts the annual investment conference Financial Markets Indaba.

In its ‘Zimbabwe: A Return to Normalcy report released on Monday, Emergent Research said in the event of a clear winner and accepted election, GDP growth is expected to be 6,5% in 2018 before jumping to 15% in 2019.

“In a clear winner and accepted election, GDP growth is expected to be 6,5% in 2018 before jumping to 15% in the following year. Capital formation in the form of mining and infrastructure projects is anticipated to materialise and stimulate downstream spending and incomes. Growth will average 12% between 2019 and 2023,” Emergent Research said.

“The case of a disputed election introduces a period of tepid growth starting with 2.5% in 2018. Any goodwill earned so far this year will be largely reversed by a contested result. Growth is projected to remain below 4% as in the period 2013 and 2016 where the 2013 results were generally disputed by the Opposition.”

Emergent Research said the ensuing growth will then average 9,3% in the following four years.

Emergent Research based the figures on the GDP growth in the Government of National Unity that took place between 2009 and 2013 where the GDP bounced back to 12% in 2009 from -17,7% contraction in 2008.

According to the South African firm, a non-disputed election with a credible winner will see western governments, development finance institutions and lenders resume lending to government, companies and projects. This growth is predicated on opportunities they see in the health industry, mining and tourism.

“Sectors that naturally leverage GDP growth and have more runway for growth are preferred. These may be sectors that have not received capital in the past and have shrunk relative to the economic size of the country and would grow if funding is made available,” Emergent Research said.

In terms of the health industry, the lack of government funding for health infrastructure projects, small and specialist operations have left the industry ripe for large scale investment and consolidation.


Under mining, the country has the potential to be in the top 10 world’s largest producers of the following minerals: gold, platinum, lithium, chrome, nickel and tantalite, making these areas attractive to investors.

Lastly, in tourism, the improvement in the political rhetoric in the last seven months has seen international arrivals in Victoria Falls and other tourist attractions go up as confirmed by the Hotel Association of Zimbabwe and Zimbabwe Tourism Authority.

What this translates to is increased visitors and therefore, export receipts. Emergent Research said investor confidence and fiscal prudence were key to economic success that provides a glimmer of hope from a credible election.

“For the first time, the core messages of two main rival parties (Zanu PF and MDC Alliance) contesting for the presidential vote have a common thread — attracting and retaining FDI (foreign direct investment) and managing the economy prudently. This is a stark departure from the incumbent’s predecessor Robert Mugabe, who governed the nation with unsuccessful economic policies in the last half of his four decades of rein,” Emergent Research said.

However, Emergent Research warned that a disputed election result and process (with many parties already complaining of such) would repel any funding and lending by current or future investors and lenders.

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7 Comments

  1. So the country is destined for the good times as for sure the elections will not only be credible but will equally produce a clear and crisp winner.

  2. ED has been scored8 eight of ten by some business leaders. But to buttress his chances he must acknowledge he has done enough to enhance his mantra Zimbabwe is open for business and migrate to hard ball campaigning. We are seeing little of the hard slogans to move people to his goal. The music is coming sweet but isolated. The dances too few. He must immediately set up the following action oriented strategies
    spiritual advisor to shepherd the President Speech content to close off the campaign
    Voice modulation voice specialists word message to match pitch and voice

    Youth mobilisation to wind off the marketing
    Rally marketing flags gear etc
    Music song enhancement
    Looking into the future victory enhancement messages
    No more lengthy speeches make them brief and many and sweet.
    Leave people to dance with their mps
    Entertainment is needed out there

    Zimbabwe may be getting the President it needs at this critical and trying time
    God bless Zimbabwe

  3. SOUTH African firm Emergent Research says a clear winner and a clean election will see the gross domestic product (GDP) grow to 6,5% by year end. This depends on who is the President,, if its ED then its a recession amid harsh economic environment, no rule of law, corruption while Chamisa on the other hand will lead Zimbabwe to rapid economic devplment. If one wants change from recession vote Chamisa and Alliance. The name speaks for itself.

  4. What factors are driving the projection of growth? I thought it was not guess work but facts on the ground the ED mantra.

    1. Since when does mantra lead to economic devplmnt. Investors don’t eat mantras, if they did then they would have benefited from Mugabes mantras too.

  5. bheveni sibanda

    its now an open secret kuti if the elections are free and fair economy inobva yatanga kuita kick start. ED has played his role for the polls to be credible and basa pa ground abatawo zvekuti handei tinomuvhotera parambe pane continuity pama projects akatangwa

  6. No people do not eat mantras but my question is, the projection stated in this article is it not based on the current govt to positioning the economy for such growth or are economists guestimating. I am sure they are reading the movement of business as they trend it now.

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