7 February 2013

Zimbabwe: Mashakada Speaks of 'Watershed Year'

Cephas Mashakada - Ndorikwira Sei Gomo ( Resource: Cephas Mashakada - Ndorikwira Sei Gomo )

ECONOMIC Planning and Investment Promotion Minister Tapiwa Mashakada is hopeful of Zimbabwe's economy, describing 2013 as a "watershed year". "There is no need to be pessimistic," he said in an address to delegates at the Zimbabwe Economic Symposium in Harare today.

"Things are looking very positive. I see 2013 as a watershed year, even beyond 2013."

Zimbabwe's economy is projected to expand by 5,2 percent this year, buoyed by the mining sector, while inflation would remain under control.

Minister Mashakada said the political situation had improved, with the country expected to hold peaceful elections later this year.

He said the country should continue using the multicurrency regime if economic growth is to be sustained.

The minister warned that any policy shift on the multicurrency regime could undermine progress achieved so far in the recovery of the economy.

"The use of the multicurrency regime should continue. It is a good planning element for the private sector."

The country adopted the use of multiple currencies in early 2009 to replace the Zimbabwean dollar.

The multi-currency system helped restore price stability, restart financial intermediation, and impose fiscal discipline by precluding the option of budget deficit monetisation.

Minister Mashakada said the inclusive Government had managed to restore economic stability, following a decade of successive recession.

He attributed the recovery to better performance of the mining sector, political stability and adherence to cash budget.

Minister Mashakada also said he was concerned over the country's widening trade deficit.

Last year, Zimbabwe's trade deficit widened as imports at US$7,8 billion outweighed exports at US$3,6 billion, according to official Government statistics.

Speaking at the same conference, World Bank senior country economist for Zimbabwe, Nadia Piffaretti said Zimbabwe's mining sector had potential to attract investment of up to US$15 billion in the next five years with potential to create 30 000 jobs. The investment would be concentrated in gold, coal and chrome.

The symposium was organised by Mandel Training Centre, in partnership with Gordon Institute of Business, the Business School of the University of Pretoria.

The symposium, under the theme "Leveraging Opportunities and Taming the Economic Jungle -- Government Perspective", was aimed at providing local companies with a global outlook to assist in strategy formulation for 2013.

Captains of industry and senior Government officials attended the symposium.

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