Analysis Of the Impact of The 2024 Mid-Term Budget On Business And National Competitiveness – Analysis Paper

This paper provides an analysis by the National Competitiveness Commission (NCC) of the 2024 mid-year budget statement presented by the Minister of Finance, Economic Development, and Investment Promotion on 25 July 2024, in line with its mandate of facilitating the creation of a competitive business environment through the development, coordination, and implementation of key policy improvements.

The Review Statement provides an update on fiscal and economic developments in the first half of the year, progress on 2024 National Budget implementation and economic outlook to year-end.

The likely impact of the 2024 mid-year budget on competitiveness is highlighted below.

IMPACT OF THE DOMESTIC ECONOMIC DEVELOPMENTS ON COMPETITIVENESS

Downward Revision of the Projected 2024 GDP Growth

The Gross Domestic Product (GDP) is a key investment decision tool, which provides valuable information to investors. GDP gives information about the size of the economy and how an economy is performing. It can also provide information on trends in consumer spending, the status of business investment, and whether prices for goods and services are rising or falling.

A downward revision of the 2024 GDP projection to 2 percent from 3.5 percent which is below 3.8 percent for Sub-Saharan Africa (SSA) and 2.6 percent for SADC indicates that Zimbabwe’s economy is underperforming compared to the region. The country is also in the bottom 3 in the SADC region after South Africa (see Table 1).

This discourages investments in Zimbabwe, which is fundamental in enhancing competitiveness as it brings in advanced technologies and new innovative ideas in production processes.

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Analysis Of the Impact of The 2024 Mid-Term Budget On Business And National Competitiveness