Publication: Zimbabwe Economic Update 2024: Improving Resilience to Weather Shocks and Climate Change
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2024-03-11
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2024-03-11
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Zimbabwe’s impressive recovery since the 2019-20 COVID-19 recession has been slowed by the 2024 El-Niño-related drought. The fiscal deficit is projected to have fallen to below 3 percent in 2024. Challenges to finance the deficit persist, which has also put pressure on the newly introduced ZiG currency. In 2024, gross domestic product (GDP) growth rate is projected to decline to 2.0 percent, driven by a sizeable agricultural contraction, as El Niño brought about the worst drought in Zimbabwe in the last 40 years. While agriculture grew by 6.3 percent in 2023, it is expected to result in a steep 15 percent decline in 2024. The manufacturing sector has seen lackluster growth, driven in part by power shortages that were caused by the El Niño drought, as declining water levels in Lake Kariba affect Zimbabwe’s hydroelectric power generation. Yet, the mining sector continues to exhibit strong growth, bolstered by rising gold prices. Similarly, the tourism industry is growing rapidly, with increasing numbers of international arrivals and hotels’ bed occupancy. Zimbabwe’s public debt is in distress and unsustainable, constraining access to international finance. To boost economic growth, Zimbabwe will need to continue tackling its macroeconomic challenges and press on with the structured dialogue platform for arrears clearance and debt resolution.
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“World Bank. 2024. Zimbabwe Economic Update 2024: Improving Resilience to Weather Shocks and Climate Change. © World Bank. http://hdl.handle.net/10986/42793 License: CC BY-NC 3.0 IGO.”
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