In­dus­try cap­tains ex­press bud­get re­view ex­pec­ta­tions

Chronicle (Zimbabwe) - - Business Chronicle - Mor­ris Mpala Oliver Kazunga

LIFE in gen­eral is bi­nary in na­ture. It’s ei­ther zero or one (0s & 1s), yes or no, in or out, with or without; the list is end­less. There was never in-be­tween and there isn’t now and it won’t be in the fu­ture. Dur­ing eco­nomic try­ing times we ask our­selves are we part of the prob­lem or part of the solution. Ask not what they can do for you but what you can do for them. This is the ba­sis for vi­able ex­is­tence.

Com­plain­ing doesn’t help. Blam­ing some­one doesn’t solve any­thing. Cry­ing post­pones the prob­lem. Do­ing noth­ing com­pounds the chal­lenge.

Wish­ing away is just that, wishes, it doesn’t change the sta­tus quo.

As long as noth­ing is done about chal­lenges then chal­lenges will re­main. Only you can change the sit­u­a­tion. Which part of the di­vide do you be­long to of ei­ther solution or prob­lem? You can’t be on the fence as it were. What­ever cir­cum­stances we are in it’s be­cause we are not tak­ing nec­es­sary ac­tion to rem­edy the sit­u­a­tion.

If you are not part of a solution please know you are trav­el­ling on the wider path. Do us a favour by look­ing for the nar­row path that leads to fi­nan­cial free­dom.

You know where you stand so let’s be truth­ful and move over to the right side.

So many a time we are just com­plain­ing and be­ing too neg­a­tive to pre­scribe so­lu­tions to our chal­lenges. We are our worst en­e­mies by com­pound­ing chal­lenges at hand ei­ther by do­ing noth­ing or by aid­ing the grav­ity of our chal­lenges.

No need to com­plain but of­fer so­lu­tions in­stead. Be part of the fo­cus group or think tank that is look­ing THE 2016 Mid-Term Na­tional Bud­get re­view should fo­cus on sta­bil­is­ing the econ­omy through re­duc­ing the fis­cal deficit and hon­our­ing the Lima agree­ment to un­lock new lines of credit to sup­port growth, in­dus­try cap­tains have said.

Na­tional fo­cus will be on Fi­nance and Eco­nomic De­vel­op­ment Min­is­ter Pa­trick Chi­na­masa as he presents the mid-term fis­cal pol­icy state­ment to­mor­row.

To­mor­row’s pre­sen­ta­tion comes at a time when the coun­try is ex­pe­ri­enc­ing eco­nomic re­gres­sion due to liq­uid­ity con­straints and lack of the much-needed for­eign di­rect in­vest­ment to stim­u­late pro­duc­tion in the man­u­fac­tur­ing sec­tor.

Poor yields in the wake of the El-Nino-in­duced drought have also damp­ened prospects for growth forc­ing a re­duc­tion of ini­tial es­ti­mated growth pro­jec­tion of 2.7 per­cent this year. Con­fed­er­a­tion of Zim­babwe In­dus­tries (CZI) vice pres­i­dent Mr Sife­lani Ja­bangwe said fis­cal deficit and the ex­ter­nal debt were chok­ing the coun­try from se­cur­ing fresh cap­i­tal in­jec­tion to stim­u­late pro­duc­tion in the man­u­fac­tur­ing sec­tor.

Zim­babwe owes an es­ti­mated $600 mil­lion to the African De­vel­op­ment Bank, $110 mil­lion to the In­ter­na­tional Mon­e­tary Fund and $1 bil­lion to the World Bank.

The coun­try’s cred­i­tors ac­cepted the coun­try’s debt clear­ing strat­egy in Lima, Peru, last year where the IMF laid the debt clear­ance strat­egy in the first half of 2016.

Zim­babwe has missed the tar­get and has up to the end of the month to ful­fil the agree­ment.

“Fo­cus should be on how the mid-term bud­get state­ment will re­duce the fis­cal deficit to un­lock fresh lines of credit needed to sup­port in­dus­tries and other cap­i­tal de­vel­op­ment projects,” said Mr Ja­bangwe.

“We also look for­ward to hear­ing an an­nounce­ment re­gard­ing the set­tle­ment of the ex­ter­nal debt con­sid­er­ing that what the coun­try promised to pay the IMF and other fi­nanciers in line with the Lima agree­ment is now due.”

He said in­dus­try was also look­ing for­ward to the Gov­ern­ment an­nounc­ing other sup­port mea­sures for in­dus­try in re­la­tion to the Statu­tory In­stru­ment 64 of 2016, which con­trols im­ports of listed prod­ucts.

“In view of the im­port con­trol reg­u­la­tions such as SI 64/2016 meant to pro­tect lo­cal in­dus­tries from im­ports, we’re look­ing for­ward to other sup­port mech­a­nisms that will tighten screws on im­ports so that ca­pac­ity util­i­sa­tion in in­dus­try can ac­tu­ally go up to com­pet­i­tive lev­els across all sec­tors,” said Mr Ja­bangwe.

Due to in­ter­ven­tions such as the Con­sign­ment Based Con­for­mity As­sess­ment (CBCA) pro­gramme and SI 64/2016, some com­pa­nies in the food pro­cess­ing sec­tor have in­creased ca­pac­ity util­i­sa­tion to about 85 per­cent as im­ports lev­els from that sec­tor have come un­der con­trol.

Buy Zim­babwe chief econ­o­mist Mr Kip­son Gun­dani said Min­is­ter Chi­na­masa was faced with a mam­moth task of balanc­ing rev­enue col­lec­tion and cut­ting down on tax to give com­pa­nies breath­ing space from high tax­a­tion.

In the past, con­cerns have been raised over high tax­a­tion rates on busi­nesses as they scut­tled ef­forts to stim­u­late in­dus­trial pro­duc­tiv­ity.

The Zim­babwe Na­tional Cham­ber of Com­merce (ZNCC) chief ex­ec­u­tive of­fi­cer Mr Christo­pher Mu­gaga said: “Our po­si­tion as ZNCC is that peo­ple should not look at the up­com­ing mid-term bud­get as a stim­u­lant but as a sta­biliser be­cause there is no money in the econ­omy.

“Se­condly, there is a need for Min­is­ter Chi­na­masa to con­sider tax is­sues in the mid-term fis­cal pol­icy re­view. As busi­ness, we strongly feel the Gov­ern­ment should not con­tinue pe­nal­is­ing com­pa­nies that are strug­gling with heavy tax­a­tion penal­ties for non-remittance be­cause that is pro­mot­ing de-in­dus­tri­al­i­sa­tion”.

He said the Gov­ern­ment should also do away with the set­ting up of a Spe­cial Eco­nomic Zones au­thor­ity to over­see the im­ple­men­ta­tion of the eco­nomic zones.

“There’s no point for the coun­try to have a SEZs au­thor­ity when we have got no money. In­stead the Gov­ern­ment should task the Zim­babwe In­vest­ment Au­thor­ity to over­see the im­ple­men­ta­tion of SEZs so that we save money,” said Mr Mu­gaga. The Min­istry of Fi­nance has pro­posed the set­ting up of a board to man­age af­fairs re­lated to the roll out of SEZs.

The SEZs Bill was gazetted at the end of last year and has gone through first and sec­ond read­ings in Par­lia­ment. —


Min­is­ter Pa­trick Chi­na­masa

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