| Economy to Grow in Next Year -- Minister |
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| Friday,December 01,2006 Posted: 21:08 BJT(08 GMT) Business Day (Johannesburg) |
Zimbabwe's economy is expected to grow by 0,5 to 1,0% next year while inflation should slow to triple digits thanks to a projected increase in farm output, Finance Minister Herbert Murerwa said today.
Presenting his annual budget for the state, which is mired deep in political and economic crisis, Murerwa said the government believed its worst days were behind it.
"We are beginning to see a slow economic recovery. Next year the economy is projected to grow by 0,5-1,0% against the anticipated good weather, high mineral demand and improved tourism arrivals," Murerwa said in a televised speech to parliament.
Murerwa had earlier revised this year's growth forecasts to between 0,3 and 0,6%, down from a previous estimate of 1 to 2%. Economists say Zimbabwe's economy has shrunk in real terms for the past six years. Murerwa said inflation, now the highest in the world at 1,070,2% and dubbed number one enemy by President Robert Mugabe's government, would retreat to between 350-400% by next September.
Analysts, including the International Monetary Fund, expect it to accelerate further. Murerwa said agriculture, which was initially expected to record 23% growth this year, was now expected to grow by 6,4% due to low output of maize and wheat, the country's two main staple crops. He did not give a projected figure for agricultural growth next year, but said it would be better.
Murerwa put a positive spin on an economy teetering on the brink of collapse, saying the mining sector, which has overtaken agriculture as the top foreign currency earner, would grow by 4,9% next year.
Zimbabwe is in the midst of its deepest recession since independence from Britain in 1980, marked by record inflation, unemployment above 80% and shortages of everything from foreign currency to food.
Veteran leader Mugabe denies he is responsible, saying the economy is a victim of sabotage by rich countries opposed to his controversial seizure of land from white farmers to redistribute to blacks. "The economy remains under siege ... facing sanctions from the West and a deliberate effort to undermine our economic revival," Murerwa told Parliament.
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