By Golden Sibanda
Zimbabwe’s negative trade balance narrowed markedly in August this year, falling 42 percent to $127,2 million on the back of strong growth in exports, the Reserve Bank of Zimbabwe (RBZ) said in its monthly economic review for August.
This came as overall merchandise trade increased 14 percent, from $900,3 million in July 2018 to $1,026 billion in August 2018.
The RBZ said trade was underpinned by growth in both merchandise exports and imports but with growth in exports higher than growth in imports.
Zimbabwe’s trade deficit in 2017 was $1,8 billion, generated from $5,5 billion imports and exports of $3,7 billion.
The strong export performance in August was driven by tobacco, which grew 94 percent, gold, which surged 35,5 percent, nickel matte, which rose 28 percent and nickel concentrates, which jumped 28,7 percent. On the other hand, the country’s imports continued to be dominated by energy (power and petroleum), medicines, crude soya bean oil and other raw materials.
The country’s improved trade balance also benefited from slower growth in imports, which surged only 3 percent from $559,9 million in July to $576,5 million in August.
“Merchandise exports rose to $449,3 million in August 2018, representing a 32,03 percent increase, compared to $340.3 million registered in July 2018.
“The surge in exports was attributed to good export performance of flue-cured tobacco (94,4 percent); gold (35.4 percent); nickel mattes (28,0 percent); and nickel ores and concentrates (28,7 percent),” the central bank said.
The 2018 flue-cured tobacco deliveries reached a record 238 million kg, the highest ever in Zimbabwe’s history, beating 2000’s record of 237 million kg achieved in 2000.
Zimbabwe’s second biggest export earner, gold, reached a haul of 28 tonnes in the months to September and firmly in line to beat target of 30 tonnes for 2018.
The country’s exports were mainly destined for South Africa (43,9 percent); the United Arab Emirates (24,6 percent); Mozambique (8,5 percent); China (5,4 percent); Zambia (1,4 percent); Botswana (0,9 percent) and Kenya (0,8 percent).
The central bank said the country’s imports for August 2018 were mainly sourced from South Africa (38,5 percent); Singapore (21,1 percent); India (5,4 percent); China (4,8 percent); Japan (3,1 percent); and Mozambique (3,0 percent).
Government intends to institute measures through the recently unveiled transitional stabilization programme (TSP) to strengthen the economy’s balance of payments, particularly with regards to enhancing exports, currency competitiveness, improving capital inflows, as well as managing over dependency on imports.
In 2017, 93 percent of Zimbabwe’s total exports were into Africa, with 63 percent of the merchandise being exported to neighbouring South Africa’s markets.