Front Matter Page
© 2005 International Monetary Fund
October 2005
IMF Country Report No. 05/359
Zimbabwe: Selected Issues and Statistical Appendix
This Selected Issues paper and Statistical Appendix for Zimbabwe was prepared by a staff team of the International Monetary Fund as background documentation for the periodic consultation with the member country. It is based on the information available at the time it was completed on August 4, 2005. The views expressed in this document are those of the staff team and do not necessarily reflect the views of the government of Zimbabwe or the Executive Board of the IMF.
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Front Matter Page
INTERNATIONAL MONETARY FUND
ZIMBABWE
Selected Issues and Statistical Appendix
Prepared by a staff team consisting of Sharmini Coorey (head), Paul Heytens, Sònia Muñoz and Sanket Mohapatra (all AFR), Michael Andrews and Jennifer Mbabazi-Moyo (both MFD), and Oleksiy Ivaschenko (World Bank)
Approved by African Department
August 4, 2005
Contents
I. Recent Trends in Poverty and Social Indicators
Text Tables
I. 1. Summary of Progress in Achieving Millenium Development Goals
II. Land Reform, Agricultural Policies, and Outcomes
A. Land Reform
B. Recent Performance in Agriculture
C. Food Security
D. Agricultural Growth and Food Security: A Way Forward
III. Fiscal Deficits and Inflation
A. First Phase: Mounting Deficits and High Inflation
B. Second Phase (2001-03): Accelerating Inflation and a Decline in Deficits
C. Third Phase (2004): Shift in the Financing of Deficit and Fall in Inflation
D. Conclusions
Figures
III. 1. Fiscal Deficits and Inflation
2. Central Government Finances
3. Contributions to Reserve Money Growth
4. Contributions to Broad Money Growth
5. Shift in Financing of Deficit
IV. High Inflation and Money Demand
A. Stylized Facts
B. Estimating a Money Demand Equation
C. Influence on Exogenous Factors on Velocity Movements
D. Conclusions
Figures
IV. 1. Within-sample Forecast
2. Recursive Estimation
3. Chow Tests
Text Tables
IV. 1. Unit-root Tests
2. Cointegrating Tests
3. Cointegrating Vector
4. Diagnostic Tests
V. Estimating the Short Run Equilibrium Real Exchange Rate
A. Methodology
B. Data and Results
C. Conclusions
Figures
V. 1. Exchange Rates and CPI
2. Percentage Deviation from Short Run Equilibrium
Text Tables
V. 1. Equilibrium Exchange Rate for External Balance
VI. Export Performance: the Impact of the Parallel Market and Governance Factors
A. Export Performance in Zimbabwe
B. Analysis and Determinants of Export Behaviour
C. Comparative Measures of Competitiveness
D. Conclusions
Text Tables
VI. 1. Business Climate, 2004
VII. The Soundness of the Zimbabwe Banking System
A. Structure of the Financial System
B. Weaknesses in the Banking Sector in 2003-04
C. Addressing the Banking Sector Problems
D. Impact of Exchange Rate Regime and Interest Rate Policies
E. Banking Sector Soundness and Resilience
F. Deposit Insurance
G. Conclusions
Figures
VII. 1. RBZ Liquidity Support to Banks
2. Bank Dependence on RBZ Funding
3. Commercial Bank Lending Rates
Text Tables
VII. 1. Financial System Structure
2. Real Costs of Bank Restructuring
3. Financial Soundness Indicators, 1999-2004
Appendices
VII. 1 Deposit-Taking Institutions (end-March 2005)
2 Banks Placed in Curatorship in 2004
3 Balance Sheet Structure (end-March 2005)
4 Stress Tests
Statistical Appendix Tables
1. Expenditure on GDP, 1998-2003
2. Gross Domestic Product, 1998-2004
3. Agricultural Crop Production, 1998-2004
4. Prices of Marketed Agricultural Crops, 1997/98-2003/04
5. Area Under Cultivation for Major Crops, 1998-2004
6. Volume and Value of Livestock Slaughtering and Milk Production, 1998-2004
7. Livestock in Communal and Commercial Farming Areas 1998-2003
8. Volume of Manufacturing Output, 1998-2004
9. Mineral Production, 1998-2004
10. Construction and Retail Trade, 1998-2004
11. Electrical Energy Produced and Distributed 1998-2004
12. Petroleum Products, 1998-2005
13. Consumer Price Index, 1998-2005
14. Consumer Price Index, December 2003-May 2005
15. Employment and Employment Earnings 1998-2004
16. Central Government Operations, 1999-2004
17. Detailed Central Government Revenue, 1999-2004
18. Detailed Central Government Expenditure and Net Lending, 1999-2004
19. Expenditure and Repayments by Ministries 1999-2003
20. Civil Service Employment Budgeted Posts, 1999-2003
21. Central Government Debt and Debt-Service Payments, 1999-2004
22. Money Supply, 1998-2004.
23. Monetary Survey, 1998-2004
24. Assets and Liabilities of Monetary Authorities, 1998-2004
25. Consolidated Accounts of Deposit Money Banks and Other Banking Institutions, 1998-2004
26. Required Reserves and Liquid Asset Ratios, 1998-2004
27. Selected Interest Rates, 1998-2004
28. Sectoral Analysis of Commercial Banks’ Loans and Advances, 1998-2004
29. Sectoral Analysis of Merchant Banks’ Loans and Advances, 1998-2004
30. Nonbank Financial Institutions’Assets, 1998-2004
31. Balance of Payments, 1998-2004
32. External Trade Indicators, 1998-2004
33. Exports by Commodity, 1998-2004
34. Direction of Export Trade, 1998-2004
35. Imports by Principal Commodities, 1998-2004
36. Direction of Import Trade, 1998-2004
37. International Reserves, 1998-2004
38. External Debt Outstanding by Creditors, 1998-2004
39. Summary of the Tax System as of June 2005