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Zimbabwe to grow at 27% yearly to reach Biti's $100bn target

by Staff reporter
08 May 2018 at 18:14hrs | Views
MDC Alliance principal and former Finance Minister, Tendai Biti, has repeatedly claimed that, if elected into government, the opposition coalition would propel Zimbabwe to a $100 billion economy in eight years.

According to Zimfact, Biti told an MDC Alliance rally in Murehwa on March 24, 2018, that the $100 billion economy target could be reached in under eight years.

Zimbabwe's official 2018 budget statement, presented on December 7, 2017, estimates that the country's real gross domestic product was $14,5 billion. It projected real GDP to reach $15.2 billion this year.

Using the geometrical growth calculation formula, Zimbabwe's $15 billion economy, growing at 8 percent (or 8.5 percent for that matter), cannot possibly amount to $100 billion.

Instead, growing at 8 percent annually for the next eight years, the economy would grow to just under $28 billion.

The economy would need to grow at an astounding 27 percent per year, to expand to $100 billion in eight years.

Zimbabwe's economy has, in recent years, achieved double-digit growth. This was off a low base, following the end of a decade-long recession in 2009, when former President Robert Mugabe set up a power-sharing government with the opposition, a move which saw Biti assuming the finance minister's role.

Zimfact concluded that Biti's claim that an MDC Alliance government would build a $100 billion economy in eight years, at an annual growth rate of 8 percent, is premised on erroneous calculations.

It would require a growth rate of 27 percent to build the current GDP to the levels envisaged by the former finance minister. Alternatively, it would take 25 years, at 8 percent growth, for Zimbabwe's current GDP to reach $100 billion.

Source - zimfact