Omega Ukama 
THE Reserve Bank of Zimbabwe (RBZ) governor, John Mangudya, says the country’s trade in services is recovering from the Covid-19 shock, with travel, passenger transport, and other vital services beginning to trend up.
In his recent mid-term monetary policy statement, the governor said services exports increased from $102,5 million in the first half of 2021 to $175,9 million in 2022.
Reserve Bank of Zimbabwe governor, John Mangudya
He also stated that service imports increased from $424,5 million in 2021 to $674,8 million in 2022.
Travel services have picked up following the relaxation of the Covid-19 containment measures, with people now moving freely across borders. “Freight services (transportation) have increased with increasing merchandise exports and imports.”
Preliminary estimates show that overall merchandise exports increased by 33 percent in the first half of 2022, from $2,65 billion in the same period in 2021, owing to increases in agricultural, mineral, and manufactured goods exports, according to the governor.
He said mineral exports grew by 32 percent from the $2,19 billion recorded for the same period in 2021 to $2,90 billion “on account of higher production”.
“Mineral export prices were also spurred by heightened geo-political tensions in eastern Europe and inflationary pressures in advanced economies as investors sought refuge in safe-haven assets. Gold exports benefited from higher global prices amid safe-haven demand, coupled with higher production as incentives to producers continue to bear fruit, “Mangudya said.
Agricultural exports increased from US$331,2 billion in the first half of 2021 to US$434,5 billion in 2022 on account of larger tobacco output amid significant carryover exports from the previous season.
As a result of higher exports of cigarettes, refined sugar, and electrical goods, manufactured exports climbed from US$152,8 million in the first half of 2021 to US$183,1 million in 2022, albeit from a lower basis. However, the governor warned that low competitiveness and high market development costs continue to impede manufactured exports.
According to the governor’s estimates, the current account balance increased from a deficit of US$97,2 million for the first half of 2021 to a surplus of US$387,1 million in 2022.
International remittance inflows and the continued acceleration of merchandise exports relative to imports are the main drivers of the surplus. The primary income and service deficits, however, restrained the current account surplus.
And despite the Covid-19 pandemic-related health crisis, foreign direct investment inflows increased, “largely as a result of government efforts to improve the investment climate through a number of reforms and investments by significant mining companies as the industry prepares for the US$12 billion economic target by 2030”. newsdesk@fingaz.co.zw
