The International Monetary Fund (IMF) has revised downwards Zimbabwe’s economic recovery for this year from 4.2 projected in October to 3.1 percent.
In its recent report, the Fund also said Zimbabwe’s inflation will close the year at 49.4 percent, much higher than an earlier projection of 3 percent.
The economy will slumber further in 2022 with a projected growth of only 4 percent, this is according to the latest World Economic Report released Tuesday.
Apparently, Finance Minister, Mthuli Ncube had set a seemingly over ambitious economic growth projection of 7.4% for 2021, adding that inflation would fall to below 10 percent by end of year.
Ncube banked his prediction on projected good agricultural produce, performance of the mining sector, and other key areas of the economy.
Ncube made the projection while presenting the 2021 national budget to parliament in Harare.
“From supply side, this growth will be driven by strong recovery in agriculture, mining, electricity, construction, transport and communication as well as finance and insurance,” he told Parliament.
Apparently, annual inflation rate slowed to 240.55% in March from 321.59% in February.
According to the IMF, the Zimbabwe economy shrank by 8% last year, less than its initially projected 10.4%.
Meanwhile, renowned world economic analyst, Professor Steve Hanke, says Zimbabwe’s year to year inflation is at 206.30, with prices set to climb higher and higher.
Prof Hanke says the only way the country could arrest this is by dollarisation.
Following the recent fuel price hikes in Zimbabwe, Professor Hanke wrote:
“Zimbabwe is doing its monthly dance around rising fuel prices.
“This is what happens with 206.30%/yr inflation: prices keep climbing higher and higher.
“Dollarization will stop this constant ascent, as it did in 2009!”
In 2020, the World Bank forecasted economic growth of 2.9% for Zimbabwe this year.