A range of substantial policy initiatives need to be implemented to shift resources from consumption to production in the Zimbabwe economy says the Zimbabwe Banking Corporation (ZBC) in its quarterly economic review. The state owned banking group says although Zimbabwes balance of payments improved significantly last year the underlying position deteriorated. Last years improved trade surplus was partly the result of sales of stockpiled gold and continued import restraint. It says debt service charges are projected to exceed 35 pct of exports in 1987 and warns against squeezing imports further. ZBC says mining industry import quotas for the first six months of 1987 have been halved and those for manufacturing industry cut by a third. It contrasts the performance of manufacturing industry in 1967 to 1974 with that since independence in 1980. Industrial production almost doubled between 1967 and 1974 when foreign currency allocations almost trebled in real terms. Since 1980 import allocations have been cut 45 pct and the Zimbabwe dollar has depreciated by more than 60 pct. As a result the bank says the external purchasing power of foreign currency allocations is currently only 20 pct of its 1980 levels.
ZIMBABWE BANKING CORP URGES POLICY REFORM