Finance and Economic Planning Minister Cde Patrick Chinamasa

Finance and Economic Planning Minister Cde Patrick Chinamasa has presented a US$5.1 billion 2018 national budget, projecting a 4.5 percent economic growth rate for next year.

Presenting the budget statement in Parliament today, Cde Chinamasa said the budget reflects new economic order as enunciated by President Emmerson Mnangagwa, adding that it is meant to address the low confidence levels, low production, high unemployment rate, foreign currency shortages, corruption and indiscipline, among other challenges.

Minister Chinamasa said the economy is on track to realise the projected 3.7 growth rate for 2017, adding that revenues have out-performed targets this year and by year end revenue totals are expected to reach $3.9 billion.

Some of the proposed measures in the 2018 budget statement include measures to restore marketing confidence, policy consistency, credibility and predictability, and a new economic order

Highlights of Cde Chinamasa’s budget statement include dealing with cash shortages, corruption and indiscipline, creating an investor friendly-environment, increasing use of plastic/mobile money by enhancing their availability in rural areas, as well as enforcing traders’ acceptance of mobile money.

Minister Chinamasa said exports will be critical to deal with cash shortages which are a symptom of many challenges facing the economy.

He said exports remain the major source of liquidity, hence proposals to incentivise the horticulture sector.

Below are some of the major highlights:

 

Re-organisation of the Beitbridge Border Post to enable real time entry and timely clearing of goods, to minimise delays. Minister Chinamasa proposes extension of Operation Restore Legacy to the border post to restore order at the port of entry ….to remove touts and vendors at Beitbridge Border Post. Defence Forces to coordinate with other security services on this mission

• Mining fees and charges – budget proposing downward review of ground rentals

• Rutenga now a port of entry with effect from next year

• 2018 elections allocated US$132 million

• $905.5 million to education ministry

• In 2018, government to account for all public expenditure

• To implement ease of doing business reforms

• Local content policy – government formulating it to create value in the economy

Govt will, through the Finance Bill, amend the Indigenisation Act to bring into effect the following; in the extractive sector the 51/49 will only affect diamond and platinum, not the rest of the extractive sector, which Zimbabwe will work with any investor regardless of nationality

• Strategy to engage the US and Europe at the highest level is being pursued. Government to prioritise re-engagement with multilateral financial institutions such as the IMF and the World Bank

Government to reduce diplomatic missions, reduce also diplomatic staff at those missions

Foreign travel – government to reduce the number of people travelling. Where Zimbabwe has diplomatic representation, those will represent the country, to reduce travelling costs

• In view of financing challenges, only one personal issue vehicle to permanent secretaries. Principal directors, deputy directors will be facilitated loans to purchase own vehicles, as opposed to being issued with personal issue vehicles

More than 3000 youth officers must go, says Minister Chinamasa, adding government will be abolishing their posts

• Public service structure – proposes rationalising of posts to avoid duplication of duties in line with the leaner cabinet. Those who have reached retirement age must retire. In 2018, government in consultation with the PSC will retire civil servants who have reached retirement age of 65

• Unsustainable budget deficit needs to be addressed – need for fiscal discipline, need to reduce the share of employment costs from 85% to 70% in 2018. Arbitrary reversal of cabinet agreements needs to be addressed