Zimbabwe’s exports increased by 33% to US$3,5 billion in the first half of this year, from US$2,6 billion during the same period in 2021, driven by an increase in agriculture, mineral and manufactured exports, official data showed.
In his 2022 mid-term review and supplementary budget, Finance and Economic Development minister Mthuli Ncube projected exports to reach US$7,3 billion by year end.
“Merchandise exports and imports increased by 33% and 15% to US$3,5 billion and US$3,7 billion, respectively, during the first half of 2022, compared to the same period in 2021. To year end, exports are expected to reach US$7,3 billion, spurred by increases in mineral receipts benefiting from the mineral commodity price boom, as well as increases in agriculture and manufactured exports,” he said.
“Similarly, merchandise imports are also projected to reach US$8,1 billion driven by fuel, machinery and raw material imports. As a result, the country’s balance of payments remains favourable with a current surplus of US$387,1 million having been registered during the first half of 2022.”
He said the positive current account performance reported during the period was projected to continue for the remainder of the year.
Minerals drove the rise in exports, Ncube said, confirming the robust rise in commodities during the period as economies swung out of COVID-19-induced lockdowns.
The southern African country says recovery of its economy would be driven by its rich mineral wealth and has put up a plan to double output in the sector to US$12 billion from next year.
The industry is expected to turn over US$6 billion in exports this year, from US$5 billion last year.
“Gold exports benefited from higher global prices amid safe-haven demand, coupled with higher production as incentives to producers continue to bear fruit. To that end, Fidelity Gold Refiners purchased 15 972,52kg of gold in the first half of 2022, compared to 9 954,67kg for the same period in 2021,” Ncube added.
He said agricultural exports increased from US$303,2 million in the first half of 2021 to US$434,5 million in 2022, on account of higher tobacco export volumes and firmer prices.
Tobacco has been among the crops driving Zimbabwe’s economy.
Along with crops like cotton it is expected to lift Zimbabwe out of its prolonged crisis.
But recovery of the sector has been held back by poor funding, droughts and lack of skills on the part of a new crop of farmers that entered commercial farming during violent agrarian reforms in 2000.
Ncube also said exports from the manufacturing sector grew during the review period.
“Manufactured exports increased, albeit from a lower base, from US$152,8 million in 2021 first half to US$183,1 million in 2022 driven by rising exports of cigarettes, refined sugar and electrical products. Low competitiveness and high market development costs, however, continue to hamper manufactured exports,” Ncube said.
“Merchandise exports are envisaged to close the year at US$7,3 billion, a 15,5% increase from US$6,3 billion in 2021,” he added.
“As the economy expands, so does its capacity to absorb imports that feed into the production process. Rising fuel, edible oils, grains and fertiliser prices on the international market also increased the import bill.
“Merchandise imports are projected to close the year at US$8, billion, 13,2% up from US$7,1 billion, driven by increases in grain, fuel, machinery and raw material imports.”
The minister said trade in services was recovering from COVID-19 hindrances with travel and other services resuscitated.
“Trade in services is recovering from COVID-19 shocks with travel, passenger transport and other key services beginning to trend upwards. Services exports increased from US$102,5 million in the first half of 2021 to US$175,9 million in 2022,” he said.
“Services imports similarly rose from US$424,5 million in 2021 to US$674,8 million in 2022. Travel services have picked up following the relaxation of the COVID-19 containment measures with people now moving freely across borders. Freight services (transport) have increased in line with increasing merchandise exports and imports,” he said.
Source: Bulawayo 24