THE government expects the economy to grow at a slower pace in 2012 compared with this year although inflation should be contained within single digits, partly due to prudent fiscal policies, Finance Minister Tendai Biti said on Wednesday.
The economy grew for the first time in 2009 after a decade of contraction during political turmoil, after President Robert Mugabe formed a power-sharing government with long-time rival, Prime Minister Morgan Tsvangirai.
"Agriculture and mining will remain the major contributors to overall growth, with other sectors such as tourism, manufacturing, transport and communication also increasing their share," Biti said in a pre-budget statement on Wednesday.
The statement did not say why the pace of growth would be slower in 2012.
Annual inflation was seen averaging between 3.7 and 5 percent up to the end of 2012, Biti said in the statement obtained by Reuters prior to being presented to Parliament later in the day.
Revenue was expected to rise to $3.4 billion in 2012 from $2.7 billion in 2011, but inflows from foreign donors were seen dipping to $500 million from $593.7 million this year.
Export earnings should increase slightly to $4.6 billion next year from $4.1 billion in 2012, Biti added.
Foreigners have been reluctant to release the aid still crucial to getting the economy fully back on its feet, demanding more political reforms from Mugabe, who has clashed with the West mainly over charges of human rights abuses against his opponents.