Zim economy to grow 2.8%

Cairo - Zimbabwe's economy, devastated by an economic crisis, is forecast to grow by 2.8% in 2009, a Zimbabwean economic planning ministry official said on Saturday.

Zimbabwe planned to hold a conference for international investors around July 8 and 9, Samuel Undenge, deputy minister for economic planning, told reporters in the Egyptian capital.

Economic analysts said the economy is showing signs of stabilising after a decade of decline, but remains strained by foreign currency shortages.

A new unity government, formed by President Robert Mugabe and Prime Minister Morgan Tsvangirai in February, said it needs $8.3bn for the economy to fully recover, end high levels of unemployment and revive collapsed industries.

"Our forecast for this year is that the economy is going to grow by 2.8%," Undenge said on the sidelines of an Africa economic conference in Cairo.

The country would achieve this growth following the new coalition government's move to set up a recovery programme to stabilise the economy, he told reporters. He said the programme would focus on the agriculture and mining sectors.

Undenge said the programme needed to mobilise $8.4 billion, without saying where the funds would all come from.

Major foreign donors, while acknowledging some progress by the new administration, remain unwilling to release any funding, insisting on political reforms, reversal of nationalisation laws and an end to farm invasions.

Zimbabwe recorded a monthly inflation rate of -1.1% in April as prices fell at a slower rate than in March, months after the country discarded its worthless currency, destroyed by hyper inflation, and allowed use of multiple currencies.

- Reuters