Zimbabwe Finance Minister says country has turned the corner


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These vaccines will enable us to re-open our economy, prudently and cautiously, and gradually return to usual economic activity. It is my sincere hope that through mass vaccinations, our country, our region and the world as a whole will overcome the coronavirus once and for all.

Yet the feeling of positivity runs much deeper than the vaccinations. Instead, it comes from a cold, hard look at the underlying economic data, which is all pointing in one direction. Up!

Our latest Budget projected that our economy will grow by 7.4 percent in 2021, a huge rebound from the 4.1 percent contraction in 2020, caused largely by the coronavirus.

The more conservative IMF projection of 4.2 percent growth still represents a significant increase, and a vote of confidence in our financial management from one of the most important global financial institutions.

Projections for Government revenue are equally positive, with $391 billion projected for this year, more than double 2020’s $173 billion. And throughout this challenging period, Treasury has maintained a surplus of over $6 billion on its accounts at the RBZ, which has been utilised towards emergencies, natural disasters, the coronavirus pandemic and capital projects.

Perhaps, the most important figures relate to inflation. In February, the inflation rate stood at 322 per cent year-on-year, compared with 363 percent the previous month.

On a month-by-month basis, February’s figure of 3.45 percent compares well with the previous month’s 5.43 percent.

While these numbers are of course still too high, they are a far cry from the hyper-inflation predicted by the “experts” not so long ago. And most importantly, things are going in the right direction — inflation is slowing rapidly.

The RBZ has projected a highly respectable annual inflation rate of about 10 percent by the end of the year, and as things stand, we are on track.

The positivity emerging from these figures is making even our staunchest critics stand up and take notice. Bloomberg, one of the world’s leading financial news outlets, reflected this shift in sentiment, publishing an article entitled; “Business Leaders Sound Unfamiliar Note in Zimbabwe: Optimism”. The article listed the successes of recent months, noting the “sea change” from the type of pessimism so often associated with Zimbabwe abroad.

While we are far away from the “victory” that Churchill was able to declare in his famous speech, this type of international acclaim is certainly a “new experience” for this country.

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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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