Finance and Economic Development Minister, Mthuli Ncube, on Friday, revised 2022 gross domestic product (GDP) growth targets to 4.6% from 5.5%.
Presenting the 2022 mid-term economic review statement and supplementary budget, Ncube said the downward revision of the growth targets arose from supply chain disruptions globally, a volatile currency and high inflation and low agricultural output. He said:
Economic performance during the first half of 2022 reaffirms the positive growth trajectory as projected in the 2022 national budget.
GDP growth in 2022 is, however, now projected to slow down to 4.6% from the 5.5% initially projected.
The downward revision is mainly arising from a reduced output from the 2021/22 agricultural season, compounded by continued depreciation of the local currency and rising inflation.
The impact of geopolitical developments is also weighing down on the growth potential of the economy.
Ncube also revised downwards growth projections for the manufacturing sector to 3.6% from 5.5%. He said:
Despite the increase in manufacturing capacity utilisation to 56.5% from 47% in 2021 and increased availability of domestically produced goods in the supermarkets, growth of the sector is now expected to slow down to 3.6% in 2022 compared to an initial projection of 5.5%.
The downgrade is mainly due to the high cost of production, attributable to rising in prices of imported raw materials and a poor agricultural season.
Ncube said the mining sector was expected to grow at 9.5% in 2022 up from the initially projected 8% following increased output in gold, platinum group metals, chrome, nickel, diamonds and coal.
More: Zimbabwe Independent