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Chronicle Reporter
ECONOMIC Planning and Investment Promotion Minister Simon Khaya Moyo says increased investment in the services sector could stimulate economic growth and expand the country’s job market.
Officially launching the 2015 United Nations Economic Development in Africa Report in Harare on Thursday, Minister Simon Khaya Moyo said Zimbabweans should take a leaf from regional pace setters who have started reaping benefits of a robust service industry.
The report indicates that while growth remains elusive for many countries in the continent, Nigeria, Kenya, Mauritius and Egypt are registering positive results anchored on robust service industries, he said.
“The report requires Zimbabwe to conduct a self-introspection and compare herself with other countries in terms of the performance of the service sector as well as policy differences,” said Minister Khaya Moyo.
He stressed the need to speed up implementation of the government’s Zim-Asset blueprint, which prioritises key infrastructure development with emphasis on energy, transport, water and information communication technology as underlining factors for improved service sector in Zimbabwe.
“Achievement of targets set in the Zim-Asset in these prioritised areas will require that implementation going forward takes a leaf from the findings of this report,” said the minister.
He said the report should be used to interrogate some of the major policy issues that underline Africa’s services sector and provide “policy guidance on how services, if adequately harnessed, could contribute to Africa’s regional integration and generate inclusive growth and employment”.
The importance and share of the service sector in both developed and developing economies is rising, he said, with such growth in the sector widely accepted as an indicator of economic progress.
“As a result of these changes, people are leaving the agricultural sector to find work in the service economy. This job creation is particularly useful as often it provides employment for less skilled workers in the tourism and retail sectors, which benefits the poor and represents an overall net increase in employment,” said Minister Khaya Moyo.
Citing the report findings, he said the outlook for sub-Saharan Africa indicates sustained growth driven by sustained demand boost from infrastructure projects, the expansion of productive capacities, buoyant services sectors, and a rebound in agricultural production.
Nigeria’s share of GDP from the services sector went from around 29 percent in 2013 to close to 60 percent in 2014 after the rebasing of the economy that year surpassing the traditionally dominant crude oil and natural gas production.
Apart from Nigeria, other countries which have developed their services industries with relative success and are even sourcing services to African markets include Mauritius — financial and banking services, Ethiopia — air transport, Egypt — telecommunications and Kenya — port services.
“This demonstrates Africa’s economic potential, and presents opportunities for intra-Africa services trade,” said the minister.
The report is produced by the United Nations Conference on Trade and Development (UNCTAD) with a subtitle “Unlocking the Potential of Africa’s Services Trade for Growth and Development”.
Since the establishment of their office for Africa, UNCTAD has annually published the Economic Development in Africa Report, a flagship publication dedicated to the analysis of economic development issues and challenges facing Africa.
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