Casino economy!

HARARE - The road ahead seems hard for Zimbabweans.

Once again Finance minister Tendai Biti announced in the budget yesterday that we continue to “eat what we kill” in 2013.

There will have to be more belt-tightening.

We all know why all the good policies and grand economic plans have failed and probably continue to. You don’t need a rocket scientist — it is the politics.

In a tough balancing act, Biti tackled all the issues affecting the nation — from economic to social to political issues — and conceded that Zimbabwe’s economy remained in shambles.

“We are running a feja feja economy,” he admitted.

We welcome his Cheetah option — 15-point road map proposing key reforms in the financial sector.

In the map, he tried to address issues like dwindling revenue inflows, excessive government expenditure, the high cost of borrowing, the absence of foreign direct investment, depressed business confidence, industrial retooling the Achilles’ heel — political instability.

We welcome his allocation of $50 million to bankroll the election and referendum next year.

While this will clear the uncertainty which has prevailed over the possibility of the elections next year, we hope investors do not hold back until the elections.

True, there will be further obstacles in achieving the targeted economic goals and implementing his budget.

However, what remains key in Biti’s roadmap is improving revenue inflows, effective implementation of policies and more critically a free and fair election.

Traditionally, violent elections have dealt major blows to the economy and a peaceful one is not guaranteed either. So just allocating funds for the polls is not good enough for the economy.

Interesting in the budget is the effort by Biti to address the high unemployment levels, particularly among youths and the burning issue of interest rates and bank charges.

But, to solve the unemployment problem, more needs to be done. Industry needs to get back to its feet.

On the banking sector reforms, while a mandatory four percent per annum interest on a minimum deposit of $1 000 is a good start, the concern remains that most Zimbabweans earn salaries way below that amount.

We also welcome the slash in bank charges levied on any deposit of $800 and below, a move which will be a great relief for most Zimbabweans.

Maybe the huge unbanked population will consider using the banks. We also welcome the housing and SMEs facilities.

Overall, the money allocated remains way too low considering what is required. For instance, he allocated $147 million for agriculture, but the sector requires at least $2 billion to restore capacity.

Finally, the increase of excise duty on alcohol and cigarettes will certainly ruffle a lot of feathers, but is a clever way to raise money. - Eric Chiriga

Post a comment

Readers are kindly requested to refrain from using abusive, vulgar, racist, tribalistic, sexist, discriminatory and hurtful language when posting their comments on the Daily News website.
Those who transgress this civilised etiquette will be barred from contributing to our online discussions.
- Editor

Your email address will not be shared.