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African Bank Warns a Disputed Vote Could Reverse Zimbabwe's Economic Gains

  • Tatenda Gumbo
  • Ntungamili Nkomo

Finance Minister Tendai Biti has forecast the economy, once ravaged by hyperinflation but now on the rebound, to expand by a further 9.4 percent in 2012, up from 9.3 percent last year.

Zimbabwe’s economic growth projections for 2012 could be reversed if the unity government fails to maintain political stability and hold a free and fair election, the African Development Bank has warned.

In an assessment of Harare's prospects Thursday, the African Bank also counseled that efforts to push through sweeping regulations such as the economic empowerment policy will also weaken investor confidence and slow growth.

Finance Minister Tendai Biti has forecast the economy, once ravaged by hyperinflation but now on the rebound, to expand by a further 9.4 percent in 2012, up from 9.3 percent last year.

The African Bank concluded that “the achievement of the 2012 projections is therefore subject to a stable political and economic environment… and continued firming of the international commodity prices or increase in output.”

Executive Director, John Mufukare of the Employers' Confederation of Zimbabwe told VOA's Tatenda Gumbo that talk of elections is already spooking the economy in a far-reaching way.

"We have the usual jingoistic noises, and that does not impress investors at all whether local or foreign," Mufukare commented.

But economist Eric Bloch weighed in with a different perspective, saying he does not see the anticipated vote undermining the economy's positive outlook. If anything, Bloch said, the rate of growth will remain in the same margin as last year.

More growth could be achieved if a viable government wins an outright mandate to govern, as opposed to the dysfunctional unity government currently in place, and certain economic policies are revised or entirely abrogated, Bloch said.

Organizing Secretary Qhubani Moyo of the MDC formation led by Industry Minister Welshman Ncube commented that political stability and elections held in a conducive environment are the most fundamental ingredients to Zimbabwe's economic performance.

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