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Zimbabwe predicts recovery

By unknown | Dec 04, 2006 | COMMENTS [ 0 ]

Godfrey Marawanyika

Godfrey Marawanyika

Zimbabwe's embattled finance minister, Herbert Murerwa, has set himself the herculean task of slashing four-digit inflation by two-thirds and getting the ruined economy back on track.

But experts say his latest budget is not up to the job.

Presenting the budget for next year on Thursday, Murerwa forecast marginal growth of 0,5 percent to 1percent and said that the country's astronomic inflation rate would fall to 350percent.

The projected growth would result from "good weather, the stabilisation of commodity prices, improved mineral deposits and a growing number of tourist arrivals", he said.

But critics say he is overly optimistic in a country where the economy has shrunk by one third.

The former regional breadbasket now suffers critical shortages of food and fuel.

Zimbabwe's agriculture sector is expected to grow by 6,4 percent owing to bountiful rains in the current farming season, Murerwa said.

Agriculture, once the backbone of the economy, is in decline after Zimbabwe's controversial land reform policy.

Murerwa also said the mining sector would grow by 4,9percent on the back of strong global prices.

Calisto Jokonya, president of the Confederation of Zimbabwe Industries, said: "The budget is still very shy to deal with issues affecting the economy, such as high unemployment, foreign currency problems and inflation.

"The minister did not offer any solutions."

Best Doroh, an economist with ZB Financial Holdings, said Murerwa was being "overly -optimistic".

Murerwa blamed the country's woes on sanctions imposed on President Robert Mugabe by the US and the EU.


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