Zimbabwe trade deficit narrows sharply, exports sores

ZIMBABWE’S trade deficit narrowed by 44 percent to US$400 million in the first eight months of this year from US$719 million in the comparable period last year, official figures show.

Latest data from the Zimbabwe National Statistics Agency (Zimstat) also reflects that the country during the period under review, recorded a 4,9 percent growth in exports to $2,563 billion from $2,442 billion in 2019. For the period under review, the country’s exports were dominated by primary commodities such as minerals, alloys and tobacco.

Mineral exports contributed around 77 percent to total exports, broken down as gold (US$645 million), nickel mattes (US$605 million), chrome US$88 million, diamonds (US$71 million) and platinum (US$66 million).

With the relaxation of lockdown regulations, exports also grew by 35 percent month-on-month for the period July to August 2020. Imports declined by 6,3 percent to US$2,963 billion between January and August this year from US$3,162 billion recorded during the same period last year, said the statistics agency.

Commenting on the latest data, the country’s national trade development and promotion organisation, ZimTrade, said Zimbabwe’s overall export performance was mainly driven by minerals and tobacco exports.

It said during the period under review, the value of processed and manufactured goods has also been growing.

“Further to this, Zimbabwe has been registering growth in non-traditional markets, a development that will cushion local companies from shocks that might take place in traditional markets,” said ZimTrade.

The trade promotion agency noted that one of the key targets of the National Export Strategy launched by President Mnangagwa last year is to increase visibility of Zimbabwean products in regional markets, particularly those that have not been traditional markets.

“Countries like Botswana have been recording significant growth over the years. For example, between January and August this year, exports to Botswana stood at US$24,4 million, from US$12 million during the same period in 2017, representing an increase of 100 percent,” said ZimTrade.

Further to this, ZimTrade noted that local businesses have started making inroads into the Angola market, following a market survey it conducted in November last year.

“Although exports to Angola are still subdued, US$126 000 was recorded during the period under review, up from no exports in 2017,” it said.

“Exports to Mozambique also grew by eight percent, from US$217 million recorded between January and August in 2019 to US$235 million during the same period this year.”

Exports to Mozambique also have potential to grow further if local companies fully utilise available potential in sectors such as fast-moving consumer goods, agricultural inputs and implements as well as construction and engineering. There has also been a consistent growth of exports to Kenya, where an 82 percent growth was recorded between 2017 and 2020, from US$18 million to US$33 million respectively.

“With regards to some international markets, exports to the United Arab Emirates rose from US$500 million between January and August last year to US$558 million during the same period this year.

“With horticulture exports to Dubai increasing, this is expected to augment mineral exports, which will improve on product diversification,” said the agency. – Chronicle