How Zimbabwe is faring economically as it heads for elections


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Agriculture performance

Late rains in the 2017/18 season weighed on expected yields from agric produce notably that of maize. From production levels of 1.2 million tonnes in 2017, maize produce for the current year is expected to be at least 50% lower at 600 000 tonnes and of this, 250 000 tonnes have been delivered to GMB as at June.

Countering the maize underperformance is a big performance by tobacco, which at 225 million kgs as at day 72 has set a new post dollarization high and marginally shy of touching a year 2000 high of 232 million kg.

Government has extended its hand in agriculture and this year is committed to increase command funding to over $400 million. This measure unsupported fundamentally by available resources, is likely to have a reciprocating negative effect on money supply, weak yields and higher prices.

Mining

All major resources performed ahead of the comparable first quarter period last year in terms of production.

Gold which is a key export commodity realized a 68% production jump from 4.6 tonnes in Q1 2017 to 7.8 tonnes in Q1 2018. Although both small scale and primary production has improved, the former has realized a sharper growth to dominate overall contribution in the current year. Aspects such as artisanal formalization and funding support have had a huge impact in driving volumes. Other notable gains were recorded in Diamond and Nickel the former is coming from a very low base after ZCDC took over while the latter is inspired by recovering global prices for the base metal.

A major development in the mining sector include the ceding of a piece of resourced land by Zimplats to government after years of litigations which dampened the country’s status as an investment destination. The piece of land is part of the land allocated to Karo Resources in a $4.2 billion deal which will see Karo develop a PGM mine along the Great Dyke and a refinery.

Foreign arrivals

In the first 3 months of the year arrivals spiked by 15% to 554 417 ahead of the same period last year. Asian arrivals recorded the sharpest jump at 109%.

Consequently receipts rose by 20% to $190 million from $160 in the first 3 months of the previous year.

Occupancy levels in key areas of Harare, Vic Falls and Bulawayo went up by 12%, 7% and 2% respectively. 2 top hospitality entities achieved average occupancies of about 55%.

Foreign arrivals into Zimbabwe as an aggregate has significantly picked up since the November transition which raised hope of an economic turnaround through an undisputed election.

Regional arrivals have surged on the back of deflating dollar which in prior years had strongly firmed against regional currencies. Operators have also largely adopted flexible pricing models for regional arrivals.

Continued next page

(192 VIEWS)

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The Insider

The Insider is a political and business bulletin about Zimbabwe, edited by Charles Rukuni. Founded in 1990, it was a printed 12-page subscription only newsletter until 2003 when Zimbabwe's hyper-inflation made it impossible to continue printing.

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