HARARE (Zimbabwe Investor) – The World Bank has revised Zimbabwe’s economic growth prospects for 2014 downwards to 3% below the projected global growth rate of 3.2%.
In a report prepared by the their Poverty Reduction and Economic Management (PREM) team, the World Bank cited “headwinds from the global economy, low investment and weak growth in the mining sector” as the key factors to drag down the economy.
The report said that recovery in the mining sector was likely to remain muted at 3.3% as a result of continued low international mineral prices and subdued investment in the industry. Although gold production recovered by 0.6% to reach 2168kg in the first two months of 2014, platinum was dropped 7% to 2058kg. Increased capacity at Mwana Africa owned Bindura Nickel Corporation helped surge nickel production to 3117 tonnes with 10 million carats of diamonds expected to be sold in the 2014/15 year.
The World Bank painted a bleak future pointing at lower international prices of minerals, vulnerabilities in the banking, policy inconsistences, deflationary pressure, fiscal slippages and an unbalanced external position as the downside risks.
“Growth projections in 2014 will be sensitive to the pace at which the government moves to address macro-economic vulnerabilities and structural impediments to investment, international prices and the coherency of policy responses” the World Bank report said.
Zimbabwe’s economy has continued to spiral downwards since the recovery peaks of the coalition government between 2009 and 2013.