HARARE
– Zimbabwe’s economy is now expected to grow by 7.8% in 2021 from an initial
forecast of 7.4%, driven by moderating inflation, higher commodity prices and
better agriculture harvest, Finance Minister Mthuli Ncube said on Thursday.
After
two years of recession due to drought and effects of the Covid-19 pandemic,
Zimbabwe is expected to record its highest maize output since 1984 while a
rally in global commodity prices is seen easing foreign currency shortages.
The
southern African country has battled bouts of hyperinflation and currency
collapse in the past two decades, but year-on-year inflation is now at its
lowest since March 2019 and Ncube said the rate was seen slowing further to
between 22% and 35% by the end of this year.
Workers’
unions, however, say although inflation is moderating, salaries still lag
behind and are demanding monthly pay equivalent to $500, more than double the
average wage.
The
World Bank, which expects lower growth, estimates that nearly half the 15
million population live in extreme poverty.
Analysts
say the recovery will remain fragile without outside support.
Ncube
said Zimbabwe’s external debt stood at $10.5 billion as of December 2020 and
the country would start clearing some arrears this year but did not give
details.
He expected diaspora remittances to increase to $1.3 billion this year from $1 billion in 2020. – Reuters