On a macro level, there have been some evident green shoots within the economy According to Fitch Solutions, consumer spend went up by 2 2 in 2021 during which there was real underlying growth in production and sales volumes despite the COVID 19 lock downs Capacity utilisation grew from 41 in 2020 to an estimated 55 at the end of 2021 Going into 2022 the government forecasts growth in the key economic sectors of mining and manufacturing of 8 and 5 50 respectively with sustained capital injections going into the former, which has now emerged as the primary driver of economic growth However, according to recently released government statistics, agricultural output is now forecasted below earlier expectations given erratic, unevenly distributed rains with maize expected to come in 43 lower than the previous harvest leaving a deficit of at least 300 000 tonnes We believe that continued corporate activity is a partial indicator of improved confidence in the local operating environment, marquee investments like the US 1 8 bn commitment from Zimplats appear to signal some change in perceptions The growth prospects for the economy are however heavily dependent on currency stability, moderate inflation and policy stability Year to date the parallel rate has deteriorated by 88 to US 1 ZWL 405 representing a 135 premium to the auction rate of US 1 ZWL 175 M o m inflation accelerated to double digits in April at 15 5 re introducing the downside risk of potential hyper inflation With consumer price increases outpacing salaries and the rapid deterioration of real disposable incomes and monetary value, it was perhaps inevitable that some form of intervention would be attempted in line with past historical trends under similar circumstances It is against this background that the Government has introduced new economic measures ...
