Growth demands productivity, Zimbabwe demands jobs
AUSTERITY is behind us; opportunities sparkle on the horizon. As we presented our budget for 2020, we look forward with great optimism. Not because we are wide-eyed or naïve. Not because we close our eyes to the suffering that still exists.
Rather, because our optimism is based on cold, hard facts. And these facts are that for the past year, our responsible austerity measures and the reclaiming of Zimbabwe’s monetary and fiscal fate have put our economic vision on firm foundations.
I have taught this mantra at some of the world’s finest universities, and it remains true: If the fundamentals are right, growth will follow.
So, with the fundamentals in place, economic control within our grasp, runaway spending halted, and a plan in hand, we must now double down on the crucial work of creating opportunities for Zimbabweans.
This budget, therefore, was built around the idea of “Gearing for Higher Productivity, Growth and Job Creation.”
The ZWL$63,6 billion budget focuses on five main areas; productivity and growth, job creation, competitiveness of local industry, sustainable development and export diversification.
While admittedly it is not 100 percent balanced, the projected revenues of $58,6 billion leaves a meagre budgetary deficit of 1,5 percent; acceptable by all international standards.
On the other hand, indicators suggest that with this budget, Zimbabwe’s economic growth will reach 3 percent next year (higher than most economically developed countries).
However, we must not compare apples and oranges.
And in a country whereby progress is the bottom line, that 3 percent should be placed in direct comparison to the -6 percent we achieved this year; a figure which reflected the necessary austerity measures we had to implement to reset the economy.
Having destroyed the old broken system; now is the time to rebuild.
These results should be seen across the entire economy. This budget — with a heavy emphasis on continued macro-economic stability — is projected to see an incredible achievement of single digit inflation levels.
With the fundamentals in place, this ambitious goal is now entirely achievable.
We have already battled the worst part of the storm. Now we can see the sun peeking through the clouds; and we must keep moving towards it.
Unfortunately, weather metaphors aside, the rains have not always been kind to us.
With agriculture running through our economy like an irrigation channel, we must work towards the best, but always plan for the worst.
While some countries plan “for a rainy day”, Zimbabwe must be ready for “dry days”.
The agricultural sector must, therefore, be buttressed and has been budgeted at $1,9 billion, with agricultural extension services receiving $281,5 million and irrigation programmes getting $422 million.
We will continue to support our farmers, the backbone of our great nation, until we once again become the breadbasket of Africa.
Likewise, there have been incredible efforts to resuscitate the mining sector.
Investors have swarmed our conferences and tenders, as ease of doing business improves by the day.
President Mnangagwa’s crackdown against corruption too is showing the world that an investment in Zimbabwe is becoming less risky, more transparent, and safer than ever.
Our budget forecasts a projected 4,5 percent rebound for the mining sector.
This, as with the industrial sector as a whole, will depend on stable and secure electricity supply.
Government is doing everything in its power to remedy this situation. 2020 is certainly looking bright, with the energy sector set to receive a large chunk of the budget: $8,9 billion.
While this budget is marking the end of strict austerity measures, Government will continue to support the array of social protection schemes which take care of those vulnerable Zimbabweans that have been most affected by these tough times.
So, as we glance a goodbye to austerity in the rear-view mirror, we must fixate firmly on the road of productivity ahead.
We must work hand in hand with the private sector to incentivise jobs and opportunities.
Government can play its part by guaranteeing credit throughout industry; from manufacturing to mining.
We must view investment to replace broken machinery, or to install new systems, as a long-term investment in the people of Zimbabwe.
With $368 million earmarked to the Ministry of Industry for companies to access credit for retooling, $240 million for Industrial Development Corporation, $291 million going to the Ministry of Tourism, and another $293,2 million on mining; this is a jobs-focused budget.
Furthermore, we will provide significant and meaningful tax relief to employers who employ young people below the age of 30.
The initiative, known as the Youth Employment Tax Incentive (YETI), combined with a new $500 million fund focused on youth entrepreneurship, is quite literally an investment in the future of Zimbabwe.
ICT programmes will continue to remain a priority, with another $341,7 million budgeted for this important endeavour.
And a country can never be productive without the infrastructure to facilitate trade and commerce.
These are of course the veins which deliver the lifeblood of growth. This is why we have committed another $1,2 billion for roads and $1,4 billion for dams.
Total infrastructure development in the realm of transport will reach $4,5 billion, water and sanitation sector $2,9 billion, health infrastructure $2 billion and education infrastructure $1,9 billion.
Crucially, for a productive workforce, we must have a healthy and educated workforce.
With the Ministry of Primary and Secondary Education receiving $8,5 billion, the Ministry of Higher Tertiary Education receiving $2,2 billion, and Health $6,5 billion; our commitment to a productive and healthy Zimbabwe is evident for all to see.
Despite the tough times, and the relative scarcity of resources, this is a budget of growth, a budget of opportunities and a budget for the future.
◆
‘‘
While t his budget is marking the end of strict austerity measures, Government will continue to support the array of social protection schemes which take care of those vulnerable Zimbabweans that have been most affected by these tough times.