Lovemore Mataire Senior Reporter
Government has failed to meet Zim-Asset short-term targets due to depressed domestic demand and subdued international prices for major exports, Minister of Economic Planning and Investment Promotion Simon Khaya Moyo said yesterday. Speaking at the Global SMEs and Cooperative Investment Expo conference in Harare, Cde Khaya Moyo said the current job losses being experienced in the country were as a result of decline in economic growth.
“The decline in economic growth in 2014 can generally be attributed to poor investment performance, low business confidence, liquidity constraints, infrastructure and energy deficits, limited fiscal space, depressed domestic demand and subdued international prices for major exports. These challenges are responsible for the job loses currently obtaining in the country,” said Cde Khaya Moyo.
He said Zim-Asset targeted economic growth averaging 7.3 percent during the plan period (October 2013-December 2018), with the economy expected to grow by 3.4 percent in 2013 and 6.2 percent in 2014 and continue on an upward growth trajectory to 9.9 percent in 2018.
“However, the country could only manage growth rates of 3.4 percent and 3.1 percent in 2013 and 2014 respectively,” Cde Khaya Moyo said.
He said the situation was being further compounded by a public debt that currently stands at $7.94 billion that translate to 56 percent of the Gross Domestic Product, a figure considered too high by international standards.
Cde Khaya Moyo said the manufacturing sector has been on the decline with capacity utilisation decreasing from 57.2 percent in 2011 to 36 percent in 2014 mainly due to poor agricultural performance, competition from cheap imports, power shortages, dilapidated infrastructure, high cost of capital and lack of access to international finance due to sanctions.
He said Government was working on the operationalisation of the special economic zones to improve the economic situation. Cde Khaya Moyo said the Government will provide special incentives to attract investors in all sectors of the economy.
Cde Khaya Moyo said there were various investment opportunities in agro-processing, infrastructure development, energy and tourism.