South Africa Based Investment Banker and FreeZim Congress President Joseph Makamba Busha said inorder for the country to record real growth rate the authorities had to support production and exports.
Minister of Finance and Economic Development Professor Mthuli Ncube projected that the economy would grow by 5.5 percent in 2022.
The target was downgraded by the minister to 4.6% as he presented the 2022 supplementary budget in July this year. This has been further downgraded to 4%.
Government attributed the economic growth downgrades to global geopolitical tensions, domestic and international inflationary pressures, the COVID-19 epidemic, and the effects of continued global warming.
During the 2023 budget presentation at the new Parliament building last Thursday Ncube projected that the economy would grow by 3.8%.
Responding to the projected 2023 growth rate Busha said in relation to the inflation the growth rate was inconsequential.
“A positive growth rate is good, but in the Zimbabwean case 3.8% growth rate is minuscule relative to current annual inflation of 268.8%.
“Therefore real growth rate remains negative,” Busha said.
Asked what the government needed to do to increase the economic Busha said, “Endogenous factors that could increase growth targets include strategic allocation of capital into production sectors.
“Increasing agricultural and industrial production; reducing unnecessary and wasteful expenditure; restructuring the economy from a consumption economy into a production and export-oriented economy.”
The economy has been battling with numerous challenges inclusive of exchange rate volatility, corruption, low capacity utilisation, drought and policy inconsistency.
However, in the 2023 proposed budget Ncube promised to create a conducive environment for business to thrive.
” The overriding objectives of the 2024 budget of entrenching macroeconomic stability, will accelerate economic transformation by promoting a conducive business environment that facilitates savings and investment, as well as enable long term planning, ” read the budget statement.
