Saturday, November 8, 2014

Zimbabwe economy

Policymakers and business leaders in Zimbabwe seem to share the opinion that past policies are still appropriate for the New Normal economy of the post-Global Financial Crisis world.


Since dollarization, investment has averaged only 17% of GDP. For the economy to grow at the targeted (ZIM-ASSET) 6% to 7% rate, investment of at least 30% of GDP needed.


China, the US, the Euro area and many others have to undergo – often painful –rebalancing. Zimbabwe is no exception, especially after the meltdown of the “Lost decade” (1998-2008).


For the immediate future the economy will continue in muddle-through mode, as growth will be lack-lustre – 3% to 4%.


Financial sector will restructure as banks consolidate, hence fewer banks and asset managers.



A republication of a presentation by Professor Tony Hawkins, Economist and Professor, University of Zimbabwe.


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