Towards a prosperous and empowered Upper Middle Income Society by 2030
THE will from this week be publishing parts of the Transitional Stabilisation Programme Reforms Agenda to conscientise the public on the Government’s new economic trajectory.
THE Transitional Stabilisation Programme over October 2018 to December 2020, which contains and expresses the aspirations of the people of Zimbabwe, draws its policy thrust from Vision 2030.
The aspirations of Vision 2030 will be realised through five strategic clusters, namely: Governance; Macro-economic Stability and Re-engagement; Inclusive Growth; Infrastructure and Utilities; Social Development.
The aspirations of Vision 2030 of a Prosperous and Empowered Upper Middle Income Society are anchored by values and objectives which include: Improved Governance and the Rule of Law; Re-orientation of the country towards Democracy; Upholding Freedoms of Expression and Association; Peace and National Unity; Respect for Human and Property Rights; Attainment of Responsive Public Institutions; Broad based Citizenry Participation in national and socioeconomic development programmes; Political and Economic Re-engagement with the global community; Creation of a Competitive and Friendly Business Environment; Enhanced domestic and foreign investment; An aggressive fight against all forms of Corruption.
The realisation of Vision 2030 will be through the implementation of the following Strategic Programmes, supported by appropriate annual National Budgets: A twoand-a-quarter year “Transitional Stabilisation Programme” to run from October 2018 to December 2020. (And) Two FiveYear Development Strategies, with the first one running from 2021-2025, and the second covering 2026-2030.
Transitional Stabilisation Programme Objectives
The Transitional Stabilisation Programme will focus on: Stabilising the macro-economy, and the financial sector; Introducing necessary policy, and institutional reforms, to transform to a private sector led economy; Addressing infrastructure gaps; Launching quick-wins to stimulate growth.
The Programme will prioritise quick-wins, and provide the necessary prelude to the two Five-Year Development Strategies that will run from 2021-2030. In crafting this Programme, inputs of various stakeholders, who include business, labour, civic society, development partners, and other groups were taken on board.
The Transitional Stabilisation Programme acknowledges policy reform initiatives of the New Dispensation to stimulate domestic production, exporting, rebuilding and transforming the economy to an Upper Middle Income status by 2030. Much of the reform initiative was outlined in various policy pronouncements by the President, His Excellency E D Mnangagwa, starting from his Inaugural Address on 24 November 2017, as well as in the 2018 National Budget Statement outlined to Parliament on 7 December 2017.
Furthermore, Government also had the opportunity to reinforce the core values and developmental agenda of the New Dispensation towards an Upper Middle Income Economy by 2030 on 19 April 2018 at the World Bank on the sidelines of the Spring Meetings of the International Monetary Fund (IMF) and World Bank in Washington DC. Co-operating partner representation included senior management of the IMF, World Bank, the African Development Bank (AfDB), as well as the bilateral partners constituting major shareholding in the AfDB, World Bank and IMF.
Sacrifice and Perseverance
The realisation of the Transitional Stabilisation Programme short term quick-wins for the economy will be underpinned by adoption of, and strict adherence to, macro-economic stabilisation policies that require painful trade-off and sacrifice.
This is necessary to address fundamental challenges besetting the economy over the immediate term, targeted over October 2018 to December 2020. Already, signs of green shoots are emerging, in response to the goodwill arising from political, governance and economic reforms introduced by the New Dispensation.
Macro-economic stability should allow for setting up of the necessary foundation for an effective launch of Zimbabwe’s developmental programmes and projects, with the first set to be outlined in the National Development Strategy for 20212025.
Opening the Economy for Business
In order to attain the desired growth rate trajectory, Government will undertake significant reforms, such as improving the ease of doing business, improving competitiveness, and opening the country to international investors and financiers. This will help Government to focus more on policy design, institutional efficiency and regulation, that way facilitating the private sector to play a major role in running businesses.
Harnessing the digital economy and digital entrepreneurship has the potential of creating jobs for the youths, often at a low cost. This will entail implementation of concrete plans to create an enabling environment for the digital economy to thrive, including supporting the availability of faster and reliable internet connection.
Rule of Law, Human and Property Rights
This will further be reinforced by governance reforms, fairness in application of the rule of law, human rights, and upholding of property rights.
As alluded to above, the Transitional Stabilisation Programme targets quick-win initiatives, through respective growth stimulation packages, as well as instituting supportive adjustment measures, which address various existing internal and external macro-economic and financial sector imbalances, and thereby, providing a foundation for robust economic growth and development beyond 2020.
The introductory Section of the Programme outlines the fundamental quick-win macro-economic targets to be realised over October 2018 and December 2020. The targets relate to Per Capita Income1, and the required Economic Growth Rates aimed at growing employment creation, and poverty reduction.
PART I: POLICIES DEALING WITH MACROECONOMIC IMBALANCES
This Section of the Transitional Stabilisation Programme identifies key macro-economic projections to 2020. It also covers challenges and opportunities, and proffers strategies to address them under the following: Macro-economic Environment; Restoration of Fiscal Balance; Mobilising Domestic Savings; Competitiveness of Exporters.
The economy is projected to grow at around 9 percent annually in the first four years from 2019, before moderating to sustained growth rates of over seven percent over the horizon of Vision 2030, as highlighted in the Table below on key macro-economic projections.
Attainment of the macro-economic targets as projected above will be the overriding focus of the Transitional Stabilisation Programme.
A stable macro-economic environment, characterised by fiscal and monetary discipline, as well as a sustainable balance of payments position, is critical in building investor confidence. The prevailing environment of macro-economic imbalances presents constraints to the rapid economic development of the country, as public deficits fuel unsustainable large fiscal borrowing requirements and money supply growth, in the process consuming scarce foreign reserves and undermining currency stability.
Weaknesses in the macro-economic situation have also resulted in a low savings rate, high public debt, and dilapidated infrastructure which is contributing to higher domestic production costs for business. Full restoration of macro-economic balance will necessitate a phased approach, spanning over the short, medium, and longer term.
To be continued EDITOR, it’s the right of consumers to see prices displayed on goods, food and clothes so that we choose accordingly. I think the laws are there to protect consumers and stern measures must be taken to those who take laws of the country in the hands.
Businesspeople must be aware there are statutory instruments that can make them be brought to book and punished or fined for not displaying prices to consumers. We want to budget for what we purchase. Many of the above, if reporters and law inspectors carry a survey, they will witness this.
In big clothing shops on the rails the price card is written $35, if one picks the item the clothes will be mixed and some on the rail prices will be found at the till using computers. Yet each clothing item must have a price on it.
Again the issue of retailers having a three- tier payment pricing system has to be stopped. What’s surprising is that businesspeople start to cry if the Government opens up the outside world to bring in goods like foods and clothes to compete yet it’s them who cause that.
The King Makoni Clemence, Mpopoma, Bulawayo.
Finance and Economic Development Professor Mthuli NcubeMinister
President E D Mnangagwa