25 November 2010

Zimbabwe: GDP to Hit U.S.$6 Billion Mark - VP Mujuru

The country's Gross Domestic Product will expand to US$6 billion this year on the back of a projected 8,1 percent economic growth, Vice President Joice Mujuru has said.

According to the Ministry of Finance, GDP currently stands at US$4,5 billion after a 4,5 percent growth between January and December last year.

VP Mujuru said after successive years of decline the economy would grow by 8,1 percent and post a much bigger growth rate of 9,1 percent next year, driven by growth in agriculture, mining, telecommunications and manufacturing.

She said GDP would expand riding on the projected 47 percent growth in mining due to an increase in the production of gold, platinum and chrome.

The Vice President was speaking at the launch of Confederation of Zimbabwe Industries 2010 manufacturing survey in Harare yesterday.

Notwithstanding challenges related to liquidity and long-term capital mineral production, the country will also benefit immensely from strong output in diamonds.

The mining sector is forecast to remain buoyant, at least, in the near future on the back of strong mineral demand by Brazil, Russia, India and China.

The challenge, said VP Mujuru, was on how to sort out the country's internal constraints and access the external markets while mineral prices are still good.

The Vice President said agriculture would grow by 34 percent this year supported by growth in tobacco production, which increased to 122,8 million kilogrammes and cotton, which recorded output of 260 million kg this year.

Tobacco production was perched at 58 million kg last year while cotton output stood at 211 million kg last year as farmers recovered from effects of economic instability.

Growth in agricultural production also comes on the back of strong sugar output, which increased from 259 million kg last year to 350 million kg this year.

"It is pleasing to note that this year we have sufficient stocks of maize seed, reasonable quantity of small grains and fertilisers to enable farmers to plant at the onset of the rainy season. We pray the Lord favours us with good rainfall season. Efforts to rehabilitate irrigation will continue," she said.

On the other hand tourism is projected to record marginal growth this year with hotel occupancy going up from 35 percent in 2009 to 37 percent this year.

VP Mujuru said tourism receipts for the current year stood at US$770 million up from US$523 million last year and commended efforts to grow the sector.

Economic growth is forecast to be sustainable after the introduction of the multicurrency ended the hyperinflationary era of the last decade.

Annual inflation for October stands at 3,6 percent from 4,2 percent in September.

She said the Government would continue to refine economic policies and measures that seek to create an appropriate business development environment.

The Vice President noted that the current economic growth momentum could be retarded by rolling power cuts and called for fresh investment into electricity generation by either foreign or domestic investors.

"I urge the Ministry of Energy and Power Development and other relevant Government departments to do the needful and take concrete measures to address the energy shortage problems in the country," said VP Mujuru.

The Vice President said the CZI manufacturing survey-enabled stakeholders to dialogue and chart the way forward for the manufacturing sector.

She added that the economy had the capacity and ingredients to post double-digit growth considering that it had continuously declined in the last 10 years.

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