Mnangagwa Hopeful Zimbabwe's Economy Will Turn Around In 2024
President Emmerson Mnangagwa is hopeful Zimbabwe’s ailing economy will turn around this year due to an increase in tourist arrivals and the recent discovery of oil and gas in Muzarabani, reported VOA.
However, economists are not as optimistic, as Zimbabwe faces looming famine due to El Nino which is expected to further hurt the country’s agro-based economy.
In a New Year message broadcast to Zimbabweans on national television and social media, Mnangagwa said Zimbabwe was on the path to prosperity.
The President said the mining sector had surpassed the target of $12 billion in 2023, while the country was now food-sufficient. He added:
I am encouraged by the increased number of both local and international tourists visiting our country.
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Equally, investments in new tourism products and facilities which bolstered the sector are a welcome development.
As we drive towards energy self-sufficiency, the discovery of oil and gas in Muzarabani confirms Zimbabwe’s potential as a future producer of gas.
This should translate into meeting our energy demands commensurate with the ever-growing economy.
In response to Mnangagwa’s speech, Gift Mugano, an economics professor at Durban University of Technology, said:
We are an agro-based economy. We sneeze when the agriculture sector catches a cold. We know that this year there is a drought.
That will have a devastating impact on the economy. With drought, we will be importing food.
Because of the Russia-Ukraine war, which has seen prices of food, globally, go up around 50%.
We will be forking [out] something in the region of close to $1 billion. Which is almost 20% or so of our total foreign currency receipt.
So this will weigh down on the economy in terms of the economy performance. So, to be quite frank and quite honest, the economy will underperform this year.
Yes, we are talking about the discovery of gas and oil but it’s too early to talk about that development as the driver of the economy.
Prosper Chitambara, senior economist with the Labor and Economic Development Research Institute of Zimbabwe, said:
In terms of the discovery of oil and gas, I think it’s going to take a bit of time probably for the country to begin to benefit from this important discovery.
I think there should be some gestation period, which also then allows for the investor to fully set up and start commercial activities.
But overall, this year the economy is expected to grow by 3.5% which is lower than the 5.5% estimated growth there for last year.
Last month, the World Bank projected Zimbabwe’s economy to slow to 3.5 per cent in 2024, with agricultural output expected to fall due to the El Nino-induced drought.
In its Zimbabwe Economic Report, released Wednesday, 13 December, the Washington-based lender also said weaker global demand for minerals will negatively impact the country’s economic growth.
More: Pindula News
