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Zimbabweans abroad sent home US$1,9 billion in 9 months
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Zimbabweans living abroad sent a record-breaking US$1.9 billion back home in the first nine months of 2024, marking a significant 16.5% increase from the US$1.6 billion remitted in the same period last year. The impressive figure highlights the growing importance of diaspora remittances to Zimbabwe's economy, with these transfers accounting for about 16% of the country's foreign currency inflows.
Finance Minister Mthuli Ncube, in his 2025 National Budget address on Thursday, highlighted the resilience of diaspora remittances, which continue to show robust growth year-on-year. Ncube projected that remittances would close 2024 at an even higher figure of US$2.49 billion, with further growth expected in 2025, when the total is anticipated to reach US$251 billion.
"Diaspora remittances have proven to be a reliable and growing source of foreign currency, and we anticipate that they will continue to drive the current account surplus," Ncube said. "The consistent inflows from the diaspora have helped support Zimbabwe's foreign exchange needs, second only to exports as a key forex earner."
In addition to the strong remittances, Ncube also revealed that Zimbabwe's international reserve position had significantly improved. As of October 31, 2024, the Reserve Bank of Zimbabwe's international reserves had risen to approximately US$540 million, up from US$285 million on April 5, 2024, following the launch of Zimbabwe Gold (ZiG). This growth is attributed to the country's strategic reserve accumulation efforts, which have bolstered both foreign currency cash and gold holdings in nostro accounts.
Ncube noted that this increase in reserves has provided Zimbabwe with a stronger buffer for economic stability and sufficient coverage for imports. He added that the government would continue to build its international reserves to support both currency stability and the broader economic environment.
The Finance Minister also addressed inflation trends, acknowledging a period of price stability following the introduction of ZiG in April 2024. Monthly ZiG inflation dropped by 2.4% in May 2024 and averaged 0.0% in the second quarter. However, inflationary pressures emerged between August and October 2024, largely driven by a surge in parallel market foreign exchange activities, which contributed to adverse inflation expectations.
To curb these pressures, the Monetary Policy Committee (MPC) implemented several stabilization measures, including an increase in the bank policy rate and adjustments to statutory reserve requirements. Additionally, the MPC allowed for greater flexibility in exchange rates and reduced the amount of foreign exchange individuals can take out of the country from US$10,000 to US$2,000. As a result, the local currency depreciated to US$1:ZiG25.
Despite these challenges, Ncube remains optimistic about Zimbabwe's economic outlook, pointing to the continued growth of diaspora remittances and the strategic strengthening of international reserves as key pillars supporting the nation's economic resilience.
Finance Minister Mthuli Ncube, in his 2025 National Budget address on Thursday, highlighted the resilience of diaspora remittances, which continue to show robust growth year-on-year. Ncube projected that remittances would close 2024 at an even higher figure of US$2.49 billion, with further growth expected in 2025, when the total is anticipated to reach US$251 billion.
"Diaspora remittances have proven to be a reliable and growing source of foreign currency, and we anticipate that they will continue to drive the current account surplus," Ncube said. "The consistent inflows from the diaspora have helped support Zimbabwe's foreign exchange needs, second only to exports as a key forex earner."
In addition to the strong remittances, Ncube also revealed that Zimbabwe's international reserve position had significantly improved. As of October 31, 2024, the Reserve Bank of Zimbabwe's international reserves had risen to approximately US$540 million, up from US$285 million on April 5, 2024, following the launch of Zimbabwe Gold (ZiG). This growth is attributed to the country's strategic reserve accumulation efforts, which have bolstered both foreign currency cash and gold holdings in nostro accounts.
Ncube noted that this increase in reserves has provided Zimbabwe with a stronger buffer for economic stability and sufficient coverage for imports. He added that the government would continue to build its international reserves to support both currency stability and the broader economic environment.
The Finance Minister also addressed inflation trends, acknowledging a period of price stability following the introduction of ZiG in April 2024. Monthly ZiG inflation dropped by 2.4% in May 2024 and averaged 0.0% in the second quarter. However, inflationary pressures emerged between August and October 2024, largely driven by a surge in parallel market foreign exchange activities, which contributed to adverse inflation expectations.
To curb these pressures, the Monetary Policy Committee (MPC) implemented several stabilization measures, including an increase in the bank policy rate and adjustments to statutory reserve requirements. Additionally, the MPC allowed for greater flexibility in exchange rates and reduced the amount of foreign exchange individuals can take out of the country from US$10,000 to US$2,000. As a result, the local currency depreciated to US$1:ZiG25.
Despite these challenges, Ncube remains optimistic about Zimbabwe's economic outlook, pointing to the continued growth of diaspora remittances and the strategic strengthening of international reserves as key pillars supporting the nation's economic resilience.
Source - NewZimbabwe
