The Sunday News
Judith Phiri, Sunday News Reporter
FINANCE and Investment Promotion Minister, Professor Mthuli Ncube (pictured) has pledged Government’s commitment to ensuring sustainability of macro-economic stability through continued implementation of sound economic policies to achieve price stability, tame inflation as well as grow the national economy.
Speaking to the media after the swearing in ceremony of ministers in Harare last week, Prof Ncube said his expanded ministry that now includes investment promotion was going to create a conducive environment for both local and foreign investors across the country’s economic sectors through working on bureaucratic bottlenecks that stifle investment growth.
The minister said in order to sustain the momentum where parallel exchange rate remained suppressed, the Government would continue with the tight fiscal and monetary policy as well as monitor and regulate financial movements that might fuel inflation in the economy. “We guarantee stability as it is what we are striving for and we are continuing with the policies that are in place. These are mainly tight fiscal policies, making sure that we manage and regulate the payment of contractors for our services so that we do not push much liquidity into the economy. On the monetary side again, we are continuing with tight monetary policy endeavors to make sure again we do not push too much liquidity into the economy which then causes troubles in terms of people rushing to the parallel market, so we are continuing with the policies that are in place.”
The minister said other measures in place that include the gold-backed digital currency (gold coins) which were critical for mopping up liquidity from the economy were going to continue. He said they were pleased that the Zimbabwean dollar was stable and as Government they will continue with the multi-currency regime.
“We have seen inflation beginning to drop and we should have again lower inflation this month of September. Everything is going according to plan and we are also expecting economic growth again this year. We expect it to be closer to 6 percent this year after a strong performance in the last three years with growth at 8.5 percent in 2021 and 6.5 percent last year 2022.”
He said the strong-performing sectors as such agriculture, mining, infrastructure development, manufacturing and tourism have been doing very well. In terms of tourism, the minister said it was roaring and performing well having recovered so well out of the Covid-19 era.
“In fact, we are running out of hotel space and there is need for investment in that sector. So, every sector seems to be really pushing well and we are pleased to be at this stage. We want to make sure we support the economy and also given my expanded mandate as Minister of Finance in terms of investment promotion, we want investment into all the sectors.”
He said working together with the Zimbabwe Investment and Development Agency (ZIDA) there was need to drive more investment in the different sectors of the economy. Minister Ncube said domestic investors were to be prioritised as well through investment friendly policies that were devoid of bureaucratic bottlenecks.
“I will not forget domestic investors as well who are already here or come from here who are also trying to invest and expand. We have to create the right environment for them to do that as domestic investment is as important as foreign direct investment,” he said.
In a statement recently, his ministry said the Government achieved considerable progress in fostering domestic macroeconomic stability by implementing a broad range of fiscal and monetary stabilisation measures. The measures put in place seem to be working as they have resulted in a drop in inflation in the past two months. The blended inflation has been negative month-on-month at -15,3 percent in July 2023 and -6,2 percent in August. Year-on-year inflation has also slowed down 101,3 percent in July to 77,2 percent in August respectively.
“We should have again lower inflation this month of September and everything is going according to plan,” said Prof Ncube.
Annual inflation is also expected to continue to decline and end the year between 60 percent and 70 percent, according to the central bank.