Zimbabweans based abroad pump US$1,2 billion in 6 months into the economy

By Nkosana Dlamini

Zimbabweans based abroad have injected a whopping US$1,2 billion into the country’s economy in the first six months, giving life to an economy that has battled currency fluctuations and foreign currency shortages.

This was announced on Thursday by Finance Minister Mthuli Ncube while presenting the 2024 Mid-Year Budget and Economic Review statement, an update on the country’s fiscal and economic developments during the first six months of the year.

“In line with this improvement in foreign currency receipts, preliminary estimates indicate that the current account recorded a surplus of US$19.2 million in the first half of 2024, a turnaround from the deficit of US$13.8 million recorded in the same period last year.” Ncube said.

“To year end, the current account surplus is projected to narrow to US$44.5 million in 2024, relative to a surplus of US$133.9 million recorded in 2023.

“Remittances grew significantly by 16.5%, from US$1 billion in the first half of 2023 to US$1.2 billion in 2024, reflecting higher inward remittances from the diaspora, resulting in a favourable impact on the current account balance.”

Diaspora remittances serve as a lifeline for many families, covering essential needs such as education, healthcare, housing, and daily living expenses.

Additionally, remittances contribute to socio-economic growth, particularly in rural areas, and can reduce poverty, hunger, and inequalities. Governments in more than 80 countries rely on remittances, making them an engine of development and transformation.

Remittance-securitized bonds are a borrowing option that receives high credit ratings, lowers government borrowing costs, and decreases government dependency on western financial institutions; with the growing popularity of remittances comes access to a wider range of investors.