Zimbabwe 2021 mid-term budget and economic review statement in full


Inflation Developments

  1. Mr. Speaker Sir, fiscal and monetary consolidation measures being implemented by Government to date, have managed to firmly anchor inflation expectations as shown by a significant decline in inflation from 837.5% in July 2020 to 106.6% in June 2021. The July year-on-year inflation is 56.37% and 2.56% for month-on-month inflation.
  2. Month-on-month inflation is expected to remain stable at less than 3% during the second half of 2021. Consequently, annual inflation is expected to decline further by end of August 2021 and further to between 22% and 35% by December 2021.
  3. Mr. Speaker Sir, the current price and exchange rate stability will go a long way in supporting industry in making long term investment decisions and allow for the efficient allocation of resources.
  4. In this regard, Treasury and the Central Bank will continue to pursue strong monetary and fiscal policies that sustain the current disinflationary path.

Monetary Developments

  1. Mr Speaker Sir, the Central Bank has continued to implement the monetary targeting framework which balances the need to sustainably anchor inflation expectations and simultaneously provide appropriate levels of liquidity in support of economic activity.
  2. The monetary targeting framework has helped to contain money supply growth, which in turn has stabilised the exchange rate and eased inflationary pressures in the economy.
  3. In 2021, reserve money growth target per quarter was lowered from 25% in 2020 to 22.5%, in order to send a strong signal to the market that Government will do whatever it takes to stabilise the economy.


  1. Mr. Speaker Sir, I wish to report to this august House that the banking sector is safe and sound, even under the disruptive impact of the COVID-19 pandemic.
  2. The banking sector remained adequately capitalised, with aggregate core capital of ZW$64.21 billion as at 31 March 2021, an increase of 20.74%, from ZW$53.18 billion as at 31 December 2020.


  1. Mr Speaker Sir, the country’s external sector position has remained strong in support of the country’s balance of payment requirements, as well as stabilising the exchange rate.
  2. Notwithstanding the transitory current account deficit realised during the first quarter of 2021, the current account balance for 2021 is projected to remain in a surplus position, albeit at a moderated level of US$611.6 million, compared to US$1 096 million recorded in 2020 .
  3. Merchandise exports are projected to increase by 4.2%, from US$4 931.9 million in 2020 to US$5 139.8 million in 2021. Mineral exports are expected to maintain strong growth on account of the continued strong performances in Platinum Group of Metals (PGMs) and recovery in chrome and high carbon ferrochrome exports.

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Charles Rukuni
The Insider is a political and business bulletin about Zimbabwe, edited by Charles Rukuni. Founded in 1990, it was a printed 12-page subscription only newsletter until 2003 when Zimbabwe's hyper-inflation made it impossible to continue printing.


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