THE MINISTER OF FINANCE AND ECONOMIC DEVELOPMENT (HON. PROF. M.NCUBE):
- Mr. Speaker Sir and Hon. Members of this august House; I move that leave be granted to present the 2021 Mid-Term Budget and Economic Review which provides an update on the performance of the economy, and the 2021 Budget implementation progress during the first half of the year. The theme of the 2021 National Budget is “Building Resilience and Sustainable Economic Recovery’’.
- This is in compliance with Section 7 (2) (a) of the Public Finance Management Act and Section 9 of the Public Finance Management (General) Regulations of 2019.
- Before I proceed with my presentation, let me begin by expressing gratitude to His Excellency the President, Dr. E. D. Mnangagwa, Vice President, Dr. Constantino D. N. G. Chiwenga, Cabinet Ministers, line Ministries, Government agencies, Honourable Members of Parliament and all stakeholders who provided their inputs in the formulation of this Review document.
ECONOMIC DEVELOPMENTS DURING THE FIRST HALF OF THE YEAR
- Mr. Speaker Sir, allow me now to turn to the contents of the Review document beginning with a brief on the global and domestic economic developments and outlook.
Global Economy
- The global economy is now projected to grow by 6% in 2021, an upward review from an initial forecast of 0.5%. Projected higher growth is on account of additional fiscal support, monetary accommodation and the ongoing vaccination process by major economies, which have the potential to reduce the severity and frequency of infections under the COVID-19 pandemic.
- The Sub Saharan region, on the other hand is projected to grow by 3.4% in 2021, a slight increase from the initial projection of 3.1%. The recovery will mostly be supported by firm international commodity prices, spill-over effects from global growth, and some supportive fiscal and monetary interventions.
DOMESTIC ECONOMIC PERFORMANCE
- Mr. Speaker Sir, the domestic GDP growth for the year 2021 is projected to remain strong at 7.8%, slightly above the 2021 National Budget growth forecast of 7.4% . The strong rebound of the economy is anchored on better 2020/21 rainfall season, higher international mineral commodity prices, stable macroeconomic environment and COVID-19 pandemic response measures, including vaccination programme.
- Higher growth rates are projected in agriculture, electricity generation, accommodation and food services, as well as financial services.
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