The spirit of the budget was noble with very clear intentions to improve the welfare of the people. This time the budget is assuming a very huge gap between GDP growth of US $8 billion and bids of US $11.3 billion. Funding this gap is a mammoth task given the disconnect between rate of economic growth and consumption.
Current state of affairs
The trade deficit is actually widening since opening up of the economy as imports respond faster than exports. Export growth will take some time to improve in the absence of enablers such as, funding, efficient production systems, infrastructure such as water, rail/road, energy/power etc.
Traditionally throughput in the manufacturing sector was locally produced but now because of the death of the agriculture in Zimbabwe coupled with antiquated capital equipment and shortage of skills, the country is having to rely more on imports.
This is happening at a time when the local industry can’t compete with import because of lack of efficiencies. Regrettably policy has not made it easier for the local producer. Capacity utilization is still very low and this will remain so as long as there is no policy adjustment to assist local industry. Chinese/ Nigerians and other foreign traders/retailers continue to destroy this sector in broad day light.
Outlook remains bleak as dictated by current policies. Economic prosperity will not be achieved for a long as we are at the same level of thinking that brought about these problems.
GPA was expected to save the nation and influence economic transformation but alas, it does appear like we may have to brace ourselves for worse problems than we imagined. Issues which should have received immediate attention and certainly would have impacted on economic change are among the following:
• Land audit
• Property rights,
• Fiscus- debt management
• International relations/Multi Donor Trust Fund
• Management of Graft/Corruption
• The notorious indigenization bill
• Government’s commitment to infrastructure development instead of
competing with private sector
• Human Rights
Politicians are making decisions for business and unfortunately they are not just gifted for that. True investment through DFI, Capital flows, Credit Lines, equity participation through private sector investments etc are still being wished for and unfortunately the policies are not enabling for as long as the above bullet items are not managed by policy Hon Biti has no capacity to plan through a budget system. Email:email@example.com