Chinamasa to present 2017 budget today

HARARAE - Finance minister Patrick Chinamasa is set to unveil the 2017 national budget in Parliament today, with economic experts urging him to come up with an expansionist spending plan to revitalise the crisis-plagued economy.

Chinamasa’s 2017 budget presentation, which comes on the back of an increase in the closure and liquidation of scores of companies and ballooning unemployment, must come up with solutions to inject fresh impetus into Zimbabwe’s ailing economy, that recently slid into recession for the first time since 2008.

“The one issue that he needs to talk about is the civil service bill because it remains outstanding,” veteran economist John Robertson said.

“There is also need to deliver on the promises of reform, for example privatising State-owned enterprises and attracting investment.

“Overall, there is not much the minister can do in the wake of shrinking revenues.”

People’s Democratic Party economic affairs secretary, Vince Musewe, said the budget will not induce confidence to hopeless Zimbabweans, pointing out Chinamasa’s previous failure to introduce austerity measures.

Musewe said the Treasury boss must focus on solving the prevailing cash shortages.

Solusi University’s Post-Graduate School of Business lecturer Bongani Ngwenya said the Finance minister will continue making budget presentations as a matter of statutory governance requirement and obligation, but there is very little he can do to make it work.

“The challenge has been declining fiscal revenues,” he said.

Ngwenya noted that most government ministries and departments were having carry-overs from 2014 and 2015.

“The situation has also been exacerbated by declining export earnings, and increasing imports demand, further straining the trade balance account,” he added.

This comes as the Zimbabwe National Chamber of Commerce chief executive, Christopher Mugaga, said growth prospects of above 1,2 percent would be nothing short of optimistic.

Initially pegged at 2,7 percent then slashed to 1,4 percent, Zimbabwe’s economic growth is anticipated to close the year in the negative after an International Monetary Fund prediction that the economy is now in recession.

“It is a tightrope that he will be walking given they were summoned to brief the President about the issue of civil servants’ bonuses.

“He does not know where he will get the money to fund incidental expenses such as bonuses,” Mugaga said.

“In my view, we really should not expect much from the budget,” he said, adding Chinamasa was likely to slash his revenue projections for the upcoming year.

In its submissions on the upcoming budget, the Confederation of Zimbabwe Industries (CZI) highlighted the need to examine the pervasive lack of confidence in the economy that is hurting new investment.

“There are several issues that need to be addressed ... including fiscal imbalances evolving around the fact that government is spending money it does not have, an uncompetitive and depressed private sector, monetary imbalance between money in the Real Time Gross Settlement (RTGS) account and underlying nostro accounts as well as the significant informal economy,” CZI said.

Comments (2)

May SOMEBODY PLEASE ANSWER ME ON THIS : What does ZEC say or whoever is responsible with this story of Hungwe: ( ) saying ... " “Yes, we can go to war. We can hire our army…our soldiers can come in to help us. We will never allow opposition political parties to rule this country..........." - His statements i believe are undermining the rights of the Masses of Zimbabwe and are in violation of Free and fair elections & the constitution too. Why then go to elections if there should be only a ZanuPF win and none other. I would like to believe that there will be many of such statements in the future from various ZanuPf People but to my surprise they get away with these such statements. PLEASE, WHO MUST DO SOMETHING ABOUT THIS?

WhiteHorse - 8 December 2016

Why all the noise about the civil service bill? The issue is not merely reducing the bill but address the capacity building issues in the economy. the 80% plus can be drastically reduced if the economy is healthy and the GDB is high - 8 December 2016

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