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Literature Review

The document investigates current research trends related to economic development issues in Zimbabwe, focusing on factors affecting economic growth from 2017 to 2022. It highlights the roles of population growth, capital investment, and government policies in promoting economic development, while also addressing challenges such as high unemployment and political instability. The literature review emphasizes the need for further research on policies that may hinder economic growth and suggests that despite some positive trends, significant structural issues remain.

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20 views6 pages

Literature Review

The document investigates current research trends related to economic development issues in Zimbabwe, focusing on factors affecting economic growth from 2017 to 2022. It highlights the roles of population growth, capital investment, and government policies in promoting economic development, while also addressing challenges such as high unemployment and political instability. The literature review emphasizes the need for further research on policies that may hinder economic growth and suggests that despite some positive trends, significant structural issues remain.

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mashiringwaninyasha2003
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© © All Rights Reserved
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GROUP ASSIGNMENT: WITH SPECIAL REFERENCE TO YOUR DEGREE

PROGRAM, INVESTIGATE CURRENT RESREARCH TRENDS PERTAINING TO


ECONOMIC DEVELOPMENT ISSUES IN ZIMBABWE. WRITE A STRUCTURED
AND ORGANISED LITERATURE REVIEW FROM 5 DIFFERENT SOURCES AND
DEMONSTRATE HOW THEIR INPUT CONTRIBUTES TO THE ISSUES YOU ARE
INVESTIGATING.

REG
SURNAME NAME (S) NUMBER PROGRAM CODE

MUSARURW
A TIYANE ALICE R227443N HACS
MUNOTIDA
SILIZANI REBECCA R227442M HACS

GILBERT
UNDENGE TADIWANASHE R227441R HACS
TOPIC: FACTORS AFFECTING ECONOMIC GROWTH IN ZIMBABWE HENCE
PROMOTING OR DISCOURAGING ECONOMIC DEVELOPMENT
Key words: Factors; Economic Growth; Promoting; Discouraging; Economic Development
Background of actuaries and their role in Economic Development
Actuaries are key players in an economy. The basic principle about actuaries is that they put a
value on future uncertain economic events Hickman, J. C. (2004). They are able to do this
through the use of mathematical and statistical models, with a relevant knowledge of business
and financial concepts. Actuaries can also be described as risk managers, as they also work to
predict and calculate the probability of future risks that can affect businesses and the economy at
large. They work in two major fields, that is, life and non-life insurance. According to Kamiya,
Shinichi, and Andreas Milidonis (2018), actuaries work independently and are governed and
regulated by independent actuarial boards. The biggest and most popular board being the
Institute and Faculty of Actuaries of the UK. There are also other boards that include the
Actuarial Society of South Africa and the Casualty Actuarial Society among others. So, on the
life field, they traditionally work in life insurance sectors and on the other hand, that is the non-
life field, they traditionally work in finance and investment. However, they are expanding their
fields of involvement into other sectors like climate change, technology and even in the banking
sectors (IFoA Guide, 2019). So, all these sectors are key to a sound and vibrant economy, hence
actuaries play a critical role in ensuring a kicking economy.
INTRODUCTION
According to (‘Economic Growth vs Economic Development | Best 7 Differences’, 2018), there
is a difference between economic growth and economic development. Economic growth is when
there is an increase in goods and services produced by a nation. There can be an improvement in
education, agricultural activities and so on leading to a steady and constant output of goods and
services. However, economic development is a process focusing on qualitative and quantitative
growth in the economy. Therefore, if there is economic growth in the long or short run,
economic development is taking place. This literature review will focus on the researches from
2017 to 2022 on economic growth of Zimbabwe. According to (Zimbabwe Overview:
Development news, research, data | World Bank, no date; Nyoni and Bonga, no date;
Nyamukasa, 2020; Increased Investment in Zimbabwe’s Tertiary Education Essential to
Economic Growth, Human Capital Development, no date), population growth, investments in
education, agriculture, government policies and capital investments have led to an increase in
economic growth by increasing the GDP (GROSS DOMESTIC PRODUCT). In addition to that,
an increment in the gross domestic product implies an increase in economic development.
Nevertheless, these authors didn’t mention how Zimbabwe’s current political situation and lack
of technological advancements is discouraging economic development.

NARRATIVE LITERATURE REVIEW


Nyoni and Bonga (no date) studied the trend in population growth from 1980 to 2015. They
studied the trend through the use of the statistics given by Zimstats (2016). The highest
population growth was in the year of 1984 which was at 3.956%. However, there was a decrease
in the population growth from 1985 to 2003. They indicated that the lowest population growth
was at 0.65%. Since then, it started increasing from 2004 to 2015 by 1.664%. Whenever there is
an increment in population, there is going to be an increase in the labour force which promotes
economic development. Their model showed that population growth had a positive impact on the
economy of Zimbabwe. Contrary to this, according to (Ndlela, no date), the unemployment rate
is a bit high despite the population growth hence hindering the economic growth and
development. Ndlela states that the rate was at 19% for the year 2021 meaning that the labour
force that contributed to economic growth hence little economic development.
Capital Investment has also contributed to the increase in economic development in Zimbabwe.
In 2019, capital investment for Zimbabwe was 0.1 billion US dollars. Capital investment of
Zimbabwe increased from 0.1 billion US dollars in 2000 to 0.1 billion US dollars in 2019
growing at an average annual rate of 15.38%, according to (knoema.com, no date) Investment
which is the addition of the national stock of capital (net investment), the construction of houses,
schools, hospitals and other firms of social capital is believed to have a less direct impact on
productive efficiency in the same way as manufacturing, commercial or agricultural investment.
Investment in new machinery and capital equipment can have more direct and quick impact on
economic growth. Since there has been an increase in economic growth due to increased capital
investment, economic development increased in 2019.
As stated in (Zimbabwe Overview: Development news, research, data | World Bank, no date),
some of the policies given by the government helped the economy develop. In their report, the
disinflation polices were effective such that inflation slowed from 838% in July 2020 to 60.7% in
December 2021. This resulted in a bit of economic growth and economic development. In
addition to that, (Zimbabwe Overview: Development news, research, data | World Bank, no date)
still suggests in order for Zimbabwe to attain economic stability, there should more policies that
promote economic so as to underpin its recovery. However, there should more research that
focuses on some policies that slow down economic growth and how these can be readjusted so
has to enhance economic growth at a faster rate.
Thereafter, in (Zimbabwe Overview: Development news, research, data | World Bank, no date),
they found that the economic rebounded fuelled by the recovery of agriculture and industry. The
Gross Domestic Product was expected to have increased by 5.8% in 2021. “An exceptionally
good agriculture season coupled by slowing inflation and higher remittances boosted domestic
demand.” Furthermore, relaxed COVID-19 restrictions, good vaccination levels and favourable
terms of trading promoted stronger industrial production. In conformity with (Insurance24,
2020), through their research, they observed that expenditure had greatly impacted the economic
growth in 2020 because of the need to cater for effects of drought, extreme weather conditions
and the COVID-19 pandemic.
CONCLUSION
However, the rise in commodity prices due to the Russia-Ukraine conflict has exacerbated
Zimbabwe’s long standing structural issues, which are characterized by rising inflation and
continuous depreciation of the Zimbabwean dollar and continue to undermine economic
recovery from coronavirus pandemic and weather shocks. Despite headline growth having
rebounded in 2021, high poverty rates and youth unemployment persist. Protests over high fuel
prices, high levels of food insecurity and endemic corruption, as well as declining real wages
inflation soars, highlight the risk of wider political instability (The Economist Intelligence Unit,
5 September 2022).
Reference list

‘Economic Growth vs Economic Development | Best 7 Differences’ (2018) EDUCBA, 9


November. Available at: https://www.educba.com/economic-growth-vs-economic-development
(Accessed: 21 September 2022).

Feature: Horrors of high unemployment - The Zimbabwe Independent (no date). Available at:
https://www.newsday.co.zw/theindependent/opinion/article/200000239/feature-horrors-of-high-
unemployment (Accessed: 21 September 2022).

Hickman, J. C. “GUEST EDITORIAL: ACTUARIES AND THE GREYING OF THE


DEVELOPED WORLD.” British Actuarial Journal, vol. 10, no. 1, 2004, pp. 1–4. JSTOR,
http://www.jstor.org/stable/41141628. (Accessed 22 Sep. 2022)

Increased Investment in Zimbabwe’s Tertiary Education Essential to Economic Growth, Human


Capital Development (no date) World Bank. Available at:
https://www.worldbank.org/en/news/press-release/2021/06/03/increased-investment-in-
zimbabwe-s-tertiary-education-essential-to-economic-growth-human-capital-development
(Accessed: 21 September 2022).

Insurance24 (2020) ZIM economy to rebound in 2021: Finance Minister, Insurance24. Available
at: https://insurance24.co.zw/zim-economy-to-rebound-in-2021-finance-minister/ (Accessed: 22
September 2022).

Kamiya, Shinichi, and Andreas Milidonis. “Actuarial Independence and Managerial Discretion.”
The Journal of Risk and Insurance, vol. 85, no. 4, 2018, pp. 1055–82. JSTOR,
http://www.jstor.org/stable/45172726. (Accessed 22 Sep. 2022).

Nyamukasa, M.E. (2020) ‘FDI – ECONOMIC GROWTH DYNAMICS IN ZIMBABWE’, 6(6),


p. 13.
Nyoni, T. and Bonga, W.G. (no date) ‘Population Growth in Zimbabwe: A Threat to Economic
Development?’, p. 12.

Overview (no date) World Bank. Available at:


https://www.worldbank.org/en/country/zimbabwe/overview (Accessed: 21 September 2022).

Zimbabwe’s economy now projected to grow by 4.6% in 2022 (no date). Available at:
https://theexchange.africa/countries/zimbabwes-economy-projected-growth-revised-downwards/
(Accessed: 22 September 2022).

Zimbabwe Overview: Development news, research, data | World Bank (no date). Available at:
https://www.worldbank.org/en/country/zimbabwe/overview (Accessed: 21 September 2022).

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