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Zimbabwe economy on recovery path, claims Mnangagwa

by Staff reporter
21 Mar 2018 at 05:35hrs | Views
Zimbabwe's economy is showing signs of recovery and growth owing to Government's aggressive economic reform agenda since the dawn of the new political dispensation, President Mnangagwa has said.

Addressing Zimbabweans living and working in Rwanda on Monday night, the President said the performance of the economy in the first three months of the year pointed towards gradual economic stabilisation and prospects for growth.

The President is here attending the African Union (AU) Extraordinary Session of Heads of State and Government, which convenes today at Kigali Convention Centre.

The 23 percent increase in foreign currency receipts in the three months to March, President Mnangagwa said, indicated that the economy was primed for growth.

He described the exponential growth in demand for foreign currency by industry, especially for importing raw materials, as a sign of "good challenges" as this showed a recovering industrial base.

On Friday, he said, the Government would be announcing a multi-billion dollar mining deal with a yet-to-be-named investor.

"Our industry is behind; most of the industries are, in terms of capacity utilisation, below 50 percent," said President Mnangagwa. "We tried to improve the industry and commerce environment by introducing Statutory Instrument 64, which has done a lot of good.

"We now know within the first quarter, whereas we would be spending something like $6 billion for imports against $4 billion exports, I understand now we have reduced the import bill by $2 billion as a result of SI 64.

"But we still need to retool our industries because we still have obsolete technology in that area. But, as the environment has improved, our people, industry and commerce, as they expand, wanting more raw materials to feed the industries, there is demand for foreign currency and we don't have that.

"Of course for foreign currency, just this period of three months has grown by 23 percent, but even so the import side has grown three times more.

"So, the challenges we are facing are good challenges because they are challenges for  growth."

President Mnangagwa said Government would embark on far-reaching infrastructure projects through public-private partnerships (PPPs).

"We need to dualise our highways between Beitbridge, Harare and Chirundu and between Beitbridge, Bulawayo and Victoria Falls; and between Mutare, Harare and Plumtree and so on - something like 4 000 kilometres of roads internally which need to get either widened or dualised," he said.

"I think you know (Finance Minister Patrick) Chinamasa doesn't have the funds to fund all these projects, so we have given (Minister                                  Joram) Gumbo the leeway to go for BOT (Build, Operate, Transfer) and PPPs, and he is busy doing that and there are so many roads now under bid."

The Head of State and Government indicated that although the National Railways of Zimbabwe (NRZ) had taken delivery of 157 wagons and locomotives, the parastatal was still struggling to cope with the movement of cargo, which he said was a sign that the economy was beginning to respond.

Zimbabwe and Botswana, he said, had agreed to jointly fund the construction of a railway line linking Zimbabwe and the north of Beira.

President Mnangagwa said Government was crafting a new diamond industry policy to ensure that it gets the maximum possible benefit from the extraction of the resource.

"Investors can come and invest in any other mineral, except diamonds and platinum, where we are interested as the State," he said. "We guard diamonds because we are crafting a diamond industry policy after looking at South Africa, Botswana and Namibia.

"We had diamond production before, but we didn't know how that industry works, so a lot of things happened in that area."

Further, President Mnangagwa pledged to highten the investment drive when he visits China next month, where he has been invited by President Xi Jinping.

The President was accompanied by Foreign Affairs and International Trade Minister Dr Sibusiso Moyo; Industry, Commerce and Enterprise Development Minister Dr Mike Bimha and Transport and Infrastructure Development Minister Dr Gumbo.

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