Listed companies buoyant about growth prospects
LISTED companies have said the country’s economic prospects look brighter this year, pinning hopes on policy consistence and implementation of development programmes outlined in the Government’s National Development Strategy (NDS1).
The projected recovery is expected to be mainly driven by construction, mining, agriculture and tourism sectors.
An analysis of latest financial results for the year ending 31 December 2021, listed banking institutions say despite setbacks brought largely by the global Covid-19 pandemic, the economy is expected to strengthen this year as the negative impact of Covid-19 subsides.
As part of its economic recovery strategy, the Government is driving a mass vaccination programme targeting herd immunity of 10 million people out of a total population of around 15 million. Underlining their confidence in the economy, which is responding to sound policies set by the Government, financial institutions said with stable macroeconomic environment, acceptance and acceleration of Covid-19 vaccination drive, a 5,5 percent GDP in 2022 is within reach.
Nedbank chairman, Mr Shepherd Shonhiwa said the Government’s targeted 5,5 percent Gross Domestic Product (GDP) growth in 2022 is achievable through implementing NDS1 policies.
“The economy is expected to strengthen in 2022 as the negative impact of Covid-19 subsides and the country records a fairly good harvest while Government on its part implements policies outlined in the National Development Strategy 1,” he said.
Mr Shonhiwa said steady vaccination along with other Government-led policies and the opening up of global economy are likely to boost tourism, trade, transport and other sectors.
“Continued implementation of disinflationary policies and the availability of foreign currency on the foreign exchange auction market are expected to rein in inflationary pressures.”
Economic growth and general stability, Mr Shonhiwa said, will support the banking industry into the future.
Construction, mining and tourism sectors are viewed as critical areas that will drive the projected economic growth.
The mining sector, for instance, is one of the economy’s strategically key productive sectors expected to account for the largest contribution to GDP growth in the short to medium-term. To that end Zimbabwe has set a target to achieve a US$12 billion mining industry by 2023. FBC Holdings Limited chief executive officer, Dr John Mushayavanhu, forecast a growing economy driven by mining and construction.
“The outlook for 2022 is positive, largely encouraged by the alleviation of global restrictions and reduced fears around Covid-19,” he said.
“Domestic economic recovery is expected to be driven by construction, mining (as international commodity prices increases) as well as accommodation and food services.” Under the Second Republic Government has among other fundamentals, prioritised infrastructural development to promote economic growth and development in line with Vision 2030.
This has seen the Government embarking on various infrastructural development projects that include Kariba South Hydropower Station expansion project, US$1,4 billion Hwange Thermal Power Expansion project and the construction of Lake Gwayi-Shangani in Matabeleland North.
To instil business confidence among local and international investors, measures that curb inflationary pressures are also seen as key for economic growth.
Old Mutual Group chairman, Mr Kumbirayi Katsande, said policy measures announced by the Ministry of Finance and the Reserve Bank of Zimbabwe are critical.
“It remains critical on the part of policy makers to remain consistent in implementing policies to promote confidence among both local and international investors,” he said.
Mr Katsande said equally important will be the efforts and measures to promote stability on the currency market and to curb inflationary pressures.
POSB chief executive officer, Mr Admore Kandlela, said increased capacity utilisation in the mining sector is pivotal to attain sustained economic growth.
“As the country projects an improvement in economic growth for the year 2022 on the back of increased capacity utilisation in the mining sector, the People’s Own Savings Bank remains positive about the country’s future prospects,” he said.
The local economy still faces a number of hurdles despite strong positive economic trends witnessed in 2021.
Concerted efforts have been and will continue to be made in the fight against the Covid19 pandemic and this is expected to result in the world economy growing.
The manufacturing sector is also set to maintain positive growth with capacity utilisation seen at 66 percent by end of 2021 from 47 percent in 2020. The improved access to foreign currency at the auction platform as well as enhanced industry support measures have been credited for rebooting company operations.-The Chronicle
