HARARE - Zimbabweans must prepare for a turbulent ride in 2014 as the recently-unveiled national budget does not paint a rosy picture.
The $4,1 billion budget announced last Thursday by finance minister Patrick Anthony Chinamasa does offer little hope that the economy will improve in 2014.
It is a consumptive budget whose largest chunk would be chewed by recurrent expenditure which Chinamasa diplomatically put as employment costs.
Where there is a consumptive budget there is no hope because it means government can spend, spend and spend.
In this case, 75 percent of the budget would be gobbled up by salaries and other costs related to state expenditure against a huge expectation of injecting money into capital projects.
It is quite strange that both Chinamasa and his colleagues in government expect economic growth in 2014 at a time the global outlook shows it receding in the same period.
The Zimbabwe economy is expected to grow to 6,4 percent, largely driven by primary commodities — mining and agriculture.
In contrast, the global economy will only rebound moderately from 2,8 percent in 2013 to 3,1 percent in 2014, as the world’s major economies still face many structural flaws and policy constraints that hinder more investment and faster productivity growth, according to the World Bank.
And Zimbabwe is part of those economies with structural flaws.
Global prices of primary commodities are forecast to go down and stagnate in 2014 until 2015!
So if Zimbabwe’s economy is expected to be spurred on by these commodities whose prices are set to plummet, why does anyone in government think mining and agriculture will push up the economy?
Prices of tobacco and cotton have been a source of consternation amongst farmers and stakeholders.
The return of the interbank market, while a positive thing, does not look particularly convincing on the part of authorities as long as they don’t tackle the malaise in the banking industry.
Chinamasa announced the $100 million inter-bank market as well as the $200 million recapitalisation of the central bank to give it the lender of last resort status.
This is positive but banks that are not performing and suffering from corporate malfeasance need to be cleaned up, to put it mildly.
2014 does not look the year Zimbabwe could emerge out of the economic tailspin which is gathering momentum at a very worrying speed.
And it could be the beginning of a long and turbulent ride into the future.