The International Monetary Fund (IMF) has released a new forecast that predicts Zimbabwe’s economy will grow by only 2.5% this year, which is slower than the 2.8% projected by the government late last year.
The IMF’s growth forecasts are also lower than those of the Zimbabwean government, which had projected a growth rate of 3.8% for this year, relying on a recovery in agriculture and mining.
In its latest World Economic Outlook published on Tuesday, the IMF expressed concerns about the global economy, trimming its global growth forecasts and revealing its weakest global growth expectations for the medium term in more than 30 years.
The IMF also noted that Zimbabwe’s economy grew by 3% last year, which was lower than the government’s estimate of 4%. However, it matched government numbers for 2021, stating that the Zimbabwean economy expanded by 8.5% that year.
In a report on Zimbabwe in December, the IMF had warned about various risks, including inflation surge, erratic rainfall, electricity shortages, and Russia’s war in Ukraine, which were adversely affecting economic and social conditions in the country.
A new report by the Confederation of Zimbabwe Industries highlighted that power cuts and high interest rates are stifling growth, with capacity utilization remaining flat at 56.1% in 2022, reflecting sluggish economic growth.
Other countries in the region are also facing challenges. South Africa, whose economic fortunes have an impact on Zimbabwe, is projected to grow by only 0.1% as it flirts with recession, with the IMF revising down its previous growth projections by 1.1 percentage points.
Meanwhile, Zambia is expected to grow by 4%, Botswana by 3.7%, Mozambique by 5%, Namibia by 2.8%, and Malawi by 2.4%.
In East Africa, the outlook appears better, with Kenya projected to grow by 5.3%, Rwanda by 6.3%, Tanzania by 5.2%, and the Democratic Republic of the Congo expected to be the fastest-growing country in the region at 6.3%.