Chinamasa keeps 2017 growth rates at 3.7%

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The economy is expected to register significant growth of 3.7 percent this year, underpinned by strong performance in agriculture of 21.3 percent; mining 5.1 percent; and electricity and water 2.5 percent, Finance and Economic Development Minister Patrick Chinamasa has said. Chinamasa said the country’s total debt, as at end December 2016, was estimated at $11.3 billion, of which public and publicly guaranteed external debt stood at US$7.3 billion, and domestic debt being US$4 billion. Meanwhile government’s 2016 expenditure amounted to $4.9b against a budget of $4b, resulting in a budget overrun of $902m. The minister said other expenditure overruns were on recapitalization of public enterprises amounting to US$220m; and compensation of former farmers amounting to US$134m. He noted that financing of the 2016 budget deficit was primarily through domestic borrowing, against the background of absence of external financing.  In total, the government deficit stood at US$1.4b, against an initial target of US$150m. This was caused by a combination of inescapable expenditure requirements and revenue under-performance of US$347.8m. Chinamasa however noted that failure to contain the budget deficit and borrowing requirements has serious economic and financial implications, “especially when support to development expenditures to stimulate production is insignificant.” Meanwhile Chinamasa says the country’s tax revenue performance for the first half of the year was 1.4% ahead of budget estimates. Chinamasa said the country’s revenues are now expected to rebound to $3.7 billion. – LES

Zimbabwe’s  total mineral export earnings in the first half of the year have exceeded the $1 billion mark as Government and miners move to grow the sector from a $2 billion to a $3 billion a year export sector, delegates attending the Mine Entra have been told,. Mines Minister Walter Chidhakwa said there remains great potential for the rebounding Zimbabwe mining industry which has over 60 minerals. – The Herald, 21 July 2017

Meanwhile the government has revised downwards its gold production target of 28 tonnes to 24,5 tonnes for this year due to loss of production in January and February largely as a result of heavy rains that flooded most mines. Small-scale miners were the hardest hit by the rains forcing many to suspend operations, while big corporates also slowed down production. Chamber of Mines of Zimbabwe president Batirai Manhando said gold output was expected at around 24,5 tonnes in 2017 from 23,2 tonnes in 2016. – NewsDay, 21 July 2017

Cabinet has approved the assumption of over $1 billion worth of debts that have been accumulated by some critical State Enterprises including Air Zimbabwe and Zisco Steel as part of accelerated efforts to make them attractive to potential suitors. Finance and Economic Development Minister Patrick Chinamasa said the assumption of parastatal debts would continue on a case by case basis. – Business Weekly, 21 July 2017 

More on Chinamasa: Zimbabwe’s economy is looking strong on agriculture after a good rain season but Finance Minister Patrick Chinamasa has warned sustained economic growth would depend on discipline and structural reforms across sectors- a swim or sink scenario. Zimbabwe’s economy is looking strong on agriculture after a good rain season but Finance Minister Patrick Chinamasa has warned sustained economic growth would depend on discipline and structural reforms across sectors. – The Herald, 21 July 2017

Dubai based investor Ali Albwardy offered only $35 million for ZSE listed Meikles Limited but there are discussions still taking place around specific individual units after talks for the takeover of the whole group collapsed. Well placed sources said that talks between Meikles and Albwardy over the takeover of the group collapsed after negotiations broke down on valuation differences after he offered to pay $35 million. The transaction was expected to subsequently result in the delisting of Meikles, which also has interest in mining. – Business Weekly, 21 July 2017 

The $250 million Dema Power Plant set up to provide emergency power in the wake of electricity shortages due to low water levels in Kariba Dam, has been mothballed on the back of fuel challenges, it has been learnt. A short term initiative implemented to alleviate the country’s power shortages, the diesel plant was spearheaded by Sakunda Holdings, a major local fuel supplier. It was meant to supply about 100 MW per hour into the national grid at $0.15c/MW. – Daily News, 21 July 2017

By |July 21st, 2017|Categories: Headlines|

About the Author:

Kudzanai Sharara
Kudzanai’s background in financial journalism with ZFN, combined with a continuing education in financial management, provide a solid grounding for his work in the research department.