Zim trade deficit declines

HARARE - Zimbabwe’s trade deficit declined by 14 percent to $322,8 million in the first quarter of 2016 compared to prior year, on the back of tight import regulations and low liquidity levels in the country.

The trade gap was down from $380 million at the end of March 2015, data released by the Zimbabwe Statistical agency (Zimstat) last week showed.

In his 2015 National Budget, Finance minister Patrick Chinamasa hiked customs duties and surtax on selected imports in a move that was aimed at reducing the country’s trade deficit as well as a measure to protect local industries from cheaper imports.

In the three months to March, Singapore overtook South Africa as Zimbabwe’s largest import destination as goods worth $165,5 million made their way into the country from the Asian country as $161,5 million worth of South African sourced goods came into Zimbabwe.

However, South Africa remained the country’s largest trading partner as trade between the two countries stood at $785 million from $689 million in February.

Zimbabwe exported goods valued at $129,9 million to Africa’s number two economy and imported $161,5 million goods from South Africa resulting in a trade deficit of $31,6 million from last month’s trade surplus of $59 million.

According to Zimstat, other top source countries for the imports included China, United Arab Emirates, Botswana, United Kingdom, India, Japan and Mozambique.

Major imports included dried fish, fresh water, milk and other related dairy products, crude oil, fuel, electrical energy, steel products and vehicle accessories, but during the month of March, Zimbabwe’s main imports were maize, petroleum products and electrical energy.

The country spent $175 million on petroleum products up from the $164 million for the same period last year due to the import of petrol worth $61 million and $1145 million worth of diesel.

Cumulatively, fuel imported during the first quarter amounted to $339 million a four percent increase on prior comparable period.

Electrical energy imported during the month of March was worth $22,5 million as Zimbabwe moved to plug electrical deficits. During the first quarter, electrical energy worth $47,6 million.

Maize worth $14,4 million and rice valued at $5,8 million were imported in March alone.

The country’s major exports were minerals and a wide range of agriculture related products such as tobacco, tea and horticulture products.

Zimbabwe’s trade deficit continues to grow as the local industry’s struggles continue, functioning below 35 percent of capacity, incapacitated by lack of funding for retooling and unreliable power supply.

Economic experts say the trade deficit will continue to widen in the absence of strong economic reforms and a stimulus package to industry.

Post a comment

Readers are kindly requested to refrain from using abusive, vulgar, racist, tribalistic, sexist, discriminatory and hurtful language when posting their comments on the Daily News website.
Those who transgress this civilised etiquette will be barred from contributing to our online discussions.
- Editor

Your email address will not be shared.