Budget to inspire hope: Biti

HARARE - Today is Budget day in Zimbabwe and Finance minister Tendai Biti says the spending plan will be aimed at inspiring hope in a country battered by a deepening political and economic crisis.

Biti will present the national Budget to a joint-sitting of both houses of Parliament against the background of an economic slowdown that has slashed GDP growth projections from nine to four percent.

This has been worsened by Zimbabwe’s isolation from key donors mainly because of rights abuses, electoral fraud and President Robert Mugabe’s controversial empowerment drive.

Walking a tight-rope, Biti says he will unveil measures to reduce rural poverty and bankroll projects focused on service delivery, education, health, water and electricity.

The IMF said last month Zimbabwe’s economy was deteriorating rapidly and that its recovery depends on clearing its $10,7 billion external debt and addressing the critical foreign currency crunch.

Biti admitted he had little “fiscal space” to meet the competing interests, high demands and expectations.

“The Budget will seek to address the issue of lines of credit, foreign direct investment and capital flows into this country which then helps to re-capitalise most of the industries. Our Budget for 2013 is reform-oriented because we need to finish the reform agenda,” he said.

“There is need for reforms in our parastatals and state enterprises, reforms in our national procurement systems and the reform of the public finance management systems,” he said.

For ordinary Zimbabweans, the Budget offers the only respite to a deepening cash crunch.

For Olga Moyo, just two years ago she could afford groceries, rent and medical aid.

She also used to go for a hairdo at the local salon for the latest swag on the fashion scene.

As she says, she was upwardly mobile.     

But all that has changed in the last two years.

Now, whenever she goes to the supermarket, she takes a calculator and goes for only the most basic of supplies. She can barely make ends meet. Millions of others are in the same boat.

Biti says everyone in government was in agreement that diamond money should shore up the budget.

“There is a huge gap between what we ought to have received and what we have actually received and I am pleased to say the law has been amended,” Biti said.

“We amended the law in July to make sure that the Zimbabwe Revenue Authority is involved in the entire value chain of diamonds,” he said.

“Cabinet, the Finance and the Mines ministries are in agreement that the Finance ministry should be central to ensure that the country gets what is due.”

Zimbabwe’s economic growth, initially expected to decline by three percent, is now expected to shrink by around five percent by year’s end.

Analysts predict quite a number of austerity measures given the forthcoming election and referendum and perhaps tax hikes in the Budget.

Elections or not, consumers such as Moyo would like to see more funds channelled into social services, especially in health care where costs have gone beyond the reach of the majority. - Gift Phiri, Political Editor

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