Zimbabwe's Economic Growth Suffers from Severe Drought Impact

Zimbabwe has revised its economic growth forecast for 2024 down to 2%, impacted by the worst drought in decades. Finance Minister Mthuli Ncube cited the El Niño-induced drought as a major factor, but anticipates a rebound to over 5% growth in 2025. Zimbabwe faces significant challenges, with major crop failures and a reliance on international aid.

Zimbabwe has revised its economic growth forecast downwards, citing southern Africa's worst drought in decades as the key factor hindering crop yields, Finance Minister Mthuli Ncube told Reuters on Wednesday. However, a recovery in growth is anticipated by 2025.

Ncube stated that economic growth is now forecast at 2% for 2024, down from an earlier estimate of 3.5%, due to an El Niño-induced drought that has led to widespread crop failures. El Niño, a natural climate phenomenon, causes unusually warm surface waters in the central and eastern Pacific, affecting global weather patterns.

Zimbabwe is among the regions hardest hit by the drought, impacting crop yields significantly. Neighboring countries Zambia and Malawi have declared states of disaster due to similar drought conditions. The International Monetary Fund also projected Zimbabwe's growth to decline to 2%, from 5.3% last year.

"We are all downgrading our growth targets for 2024 because of deeper-than-expected impacts on our agriculture, but the outlook for next year is brighter," Ncube said. He expects growth to recover to above 5% in 2025.

In May, the Zimbabwean government projected a 72% drop in staple maize production for the 2023/24 season. Ncube noted that the drought had severely affected agricultural output, necessitating the importation of 1.4 million metric tonnes of grain.

To alleviate hunger, Zimbabwe received around $32 million in drought insurance last week from an African Union agency and has appealed to international donors for food aid. Ncube will present the mid-term budget review later this month.