By Tapiwanashe Mutonhodzi
Zimbabwe’s economic turnaround should be on track following massive intervention by government to re-align the economic sectors towards a productive economy.
Quite a number of economic interventions intended to straighten the Zimbabwean economy such as the much popularised Command Agriculture has been a success leading to a first ever bumper harvest the country had longed to achieve after the land reform programme.
In this light, interventions that have been considered and can be seen to aid in revamping the economy include foreign direct investment (FDI), increase of export earnings, stable pricing system of goods and services and parastatals reform among others.
Partnerships with other countries should see an improvement on FDI. FDI refers to business investments done by a company or an individual in a certain country to another country. This can be done through establishing business operations or acquiring business assets in other countries. It entails ownership of the whole or controlling shares in a foreign company.
The President of Zimbabwe during his inauguration clearly stated that the country was ready to partner with other countries towards improving its domestic economic growth. This gave the country a new political dispensation. Countries that have now shown keen interest to work with Harare are China, Botswana, Australia and Britain among others. In recent years, China gave Harare City Council a whopping $144 million loan to improve on water delivery. These are some of the investments the country needs to turn around its economy. Last year the country concluded a US$1 billion deal to dualise the Harare to Beitbridge highway, a project that is expected to employ thousands of people.
Increased export earnings should see the nation increasing its disposable foreign currency. The economy has been currently crippled by a shortage of foreign currency to import valuable resources. Ensuring that manufacturing companies focus on exporting their produce will greatly enable the country to gain more foreign currency.
Tobacco remains the country’s largest earner of foreign currency. It cannot sustain the country for the whole year alone. To solve this problem, government is promoting the development of special economic zones which shall be responsible for focussing on manufacturing goods for the export market. A ten percent export incentive has been put in place to reduce production costs for exporters.
Recently, the RBZ Governor, Dr John Mangudya said Zimbabwe needs to increase production in quick win sectors that include agriculture, tourism and horticulture in order to increase the generation of foreign currency. Zimbabwe’s problems have everything to do with limited production. Exports are the salvation for this economy, we need to produce first.
Towards stabilising the economy, retailers and producers must maintain a system of stable prices of goods and services. To achieve this, government has been undertaking discussions and working together with various government agencies including the Consumer Council of Zimbabwe (CZI). It has continued with the surveys on prices and availability of essential products, to make sure that all players are complying with what was agreed, that prices should be adjusted downwards, while engagements to agree on the pricing models applicable along the various value chains continue.
Government has early this month made efforts to evaluate parastatals, ministries in government and state-owned enterprises (SOEs) some of which were operating profitably while others were facing challenges. The evaluation of parastatals by government was meant to identify non-performing parastatals that can be revamped through partnerships from companies in the private sector.
Strategies have been put in place by government to fulfil the initiative of the 100 days set target by President Emmerson Mnangagwa. Respective ministries which have been managing parastatals are expected to state how parastatals have been failing to make profit and the way forward on what is expected to be done to close the gap from failure to success.
Disclaimer: The views expressed in this article are the author’s and do not necessarily represent the views of the Zimbabwe Broadcasting Corporation.