ZIMBABWE BUDGET: Finance minister Patrick Chinamasa this Thursday presented a $4.1 billion budget for 2017, which forecast economic growth at a 1,7 percent.
The minister however, said the zimbabwe budget deficit reached $1,1 billion this year, and took the opportunity to warn government against abusing treasury bills to cover the shortfall.
The opposition immediately scorned the proposals with MDC-T shadow treasury minister Tapiwa Mashakada described the zimbabwe budget as “not pro-poor, not pro-business, not people-centred, not inspiring and holed by the $1, 1 billion deficit”.
Addressing Parliament, Chinamasa said: “The economy continues to be characterised by low production, low savings, high formal unemployment and cash challenges.
“It is against this background that real economic growth this year is expected at 0, 6 percent. A growth rate of 1,7 percent is expected in 2017 due to the expected recovery of some commodity prices and the ease of doing business we have experienced.
“This represents a 1, 1 percent growth increase compared with this year’s 0, 6 percent growth. The government should move away from treasury bills becoming a tool to meet budget deficit.”
The minister said the growth is expected to ride on improved performance of the extractive industry, agriculture, policy environment and productive sector.
He said as the country moves towards a watershed election in 2018, peaceful campaigns would be critical requirement for the projected growth to be achieved.
“We need to build confidence underpinned by policy consistence. We need successful conclusion of the international re-engagement of process and a good rainy season.”
He added, “We also need an atmosphere of tranquillity, tolerance and minimum polarisation in the run up to the 2018 elections and to address liquidity challenges.”
Chinamasa said the $1,1 billion budget deficit was a major concern.
“The state of our public finances as obtaining currently is characterised by a financing gap of $1, 1 billion which has become a source of great concern,” Chinamasa said.
Government is hopeful of collecting $3,7 billion in revenues against $4, 1 billion in expenditures.
In 2016, government revised the revenue target twice from $3, 85 billion to $3, 69 billion and now 3, 52 billion.
According to Chinamasa, employment costs from January to September this year accounted for 91, 4 percent of State revenues, leaving just 8, 6 percent for operations and capital expenditure. allafrica.com