2017 National Budget round-up

HARARE - On Thursday Finance minister Patrick Chinamasa presented his 2017 National Budget in Parliament and below our News Editor Gift Phiri looks at some of the highlights.
Govt raise excise on paraffin

Zimbabwe has raised excise duty on paraffin by 40 cents per litre, the Finance minister Patrick Chinamsa has announced.

The hike, which comes into force on January 1, 2017, seeks to take advantage of availability of alternative and competitively priced sources of energy, with most Zimbabweans now preferring to use solar and LP gas energy for lighting and cooking.

“It is, thus, proposed to align excise duty on paraffin with diesel at a rate of 40 cents per litre, with effect from January 1, 2017,” Chinamasa said in his budget statement Thursday.

The move is also seen as a measure to shore up government revenues without stoking inflation.

Government had last year provided for duty free importation of paraffin in order to cushion low income households.

Chinamasa said that paraffin was now being used by unscrupulous traders for blending with diesel, in order to achieve higher profit margins, thereby prejudicing revenue to the fiscus and causing mechanical damage to motor vehicle engines.

He also noted that the surge in import volumes of paraffin was clear testimony of the abuse of the duty-free facility for purposes other than the needs of low income households.

Sanitary wear raw materials now duty-free

Governemt has allowed import of sanitary wear raw materials duty-free, to keep a lid on domestic prices and overcome any shortage, the finance ministry said on Thursday.

This comes as Zimbabwean women complain that manufacturers were charging “criminal” prices for sanitary towels.

The latest move is aimed to increase the availability and affordability of sanitary pads for young girls. 

Following the entry of new local sanitary wear manufacturers, government imposed modest duty rates of 15-20 percent on sanitary wear raw materials.

“In order to enhance competitiveness of locally produced sanitary wear products, thereby promoting growth of the industry, it is proposed to avail duty-free importation of raw materials, which include pulp, glue and virgin tissue, under manufacturers’ rebate, with effect from January 1, 2017,” Finance minister Patrick Chinamasa said in his budget speech. 

Poverty underpins many girls’ lack of access to disposable sanitary towels.

Chinamasa said local companies have potential to grow and meet local demand, but the industry still faces challenges such as high cost of raw materials and loyalty of consumers to international brands.

Zimbabweans are suffering a severe economic crisis, with widespread shortages of basics, long lines common outside banks, and many now earning a living re-selling scarce goods at a premium.

School feeding gives students hope

Students are set to benefit from the school feeding programme, whose meals are poised to help keep learners in school.

It was not immediately clear how many students will receive free meals under the programme as it provides food to all of the country’s students enrolled in government schools.

The meals provided are set to reduce dropout rate as parents ensure their children’s attendance, knowing that they will get a meal. This is earmarked to break the cycle of malnutrition among the children

“In order to mitigate against learners dropping out of school on account of hunger, $0,12 million has been allocated in support of the school feeding programme.

“This modest government support complements efforts in place by parents and school authorities through the establishment of nutrition gardens,” Finance minister Patrick Chinamasa said.

Since school meals were introduced, teachers have reported greater signs of energy and happiness in the children

By going to school, and getting the proper nutrition, government is taking a step out of poverty, with the opportunity to continue students’ education and improve the lives of those around them when they grow up.

Zim addresses water shortages

Zimbabwe has announced plans to construct several dams after government declared a state of emergency in February due to water shortages in large swaths of the country amid the worst drought in years.

Finance minister Patrick Chinamasa on Thursday made funds available to alleviate a crisis that has affected families and the agricultural sector.

“Of the total water sector planned investments, an appropriation of $25,8 million is earmarked for the following construction and maintenance works: Causeway Dam, $5 million; resumption of works at Marovanyati Dam, $8,6 million; upgrading of the access road to Tokwe Mukorsi Dam, $4,5 million; and site running costs for Gwayi Shangani Dam, $3,7 million,” Patrick Chinamasa said.

“Furthermore, the $2 million allocated for Mutange Dam will enable construction of a pump house, upstream and downstream gauging weirs, which will facilitate use of the water for irrigation of 105 hectares at Mutange Irrigation Scheme.”

This comes as boreholes and deep wells in many areas are fast running dry, and rivers and small streams are drying up too. Most resettled farmers fear they will not only lose their livestock but their own sources of household water.

“In addition, $2 million has been set aside to enable Zinwa repair and maintain some of the 2 000 small dams in communal areas and 680 dams in resettled areas, as part of drought mitigation measures,” Chinamasa said.

“Efforts are also underway to mobilise resources for construction of other critical dams, particularly Gwayi-Shangani and Kunzwi Dams, which provide long term water supply security for Bulawayo and Harare, respectively.”

Treasury to spend $10m on airports upgrade

Governemt plans to spend over $10m over the next year to upgrading of international airports to handle a boom in visitors, it said on Thursday.

The budget allocation follows a surge in passengers and budget airline flights at JM Nkomo International Airport and Harare International Airport. This comes as the parliamentary portfolio committee on Transport and Infrastructural Development reported a frequent breakdown of radios, and in some cases, pilots resorting to use of cell phones to communicate with controllers.

The current air-navigation equipment being used and other equipment is outdated, making managing flight traffic in the country’s airspace difficult; and also markedly increasing the workload for pilots and air traffic control.

Air traffic controllers (ATC) are unable to provide efficient and effective air navigation service, a new report has warned, adding aircraft struggled to land.

Under the new plan, the upgrading of international airports will be further pursued in 2017 as government moves to construct new facilities, including a building linked to a new mass transit line.

“The budget has allocated $4,9 million for the construction of the Air Traffic Control Tower at JM Nkomo International Airport, with an additional $1 million of Civil Aviation Authority of Zimbabwe (Caaz’s) internal resources being channelled towards upgrading the sewer system at the airport,” Patrick Chinamasa said.

“The Caaz will further invest $4,6 million towards upgrading of equipment at Harare International Airport.

He also announced that the Meteorological Department has also been allocated $5,5 million for procurement of weather equipment to be installed at Harare, JM Nkomo and Victoria Falls international airports, in order to improve safety in aviation operations.

“Information gathered using this equipment will also be availed to other users, especially in agriculture,” Chinamasa said.

$1,7m allocated to build 3 State universities

Governemt has plans to launch three new State universities in Manicaland, Mashonaland East and Matabeleland, with $1,75 million allocated in the 2017 National Budget towards the development of master plans and designs for the three new institutions of higher learning.

This comes as Bills legislating for the setup of the universities have been passed by Parliament, awaiting presidential assent or gazetting.

Manicaland State University of Applied Sciences Bill was passed on May 12, and sent to President Mugabe on July 7, while the Gwanda State University Bill was passed on May 12 and sent to the president on July 13.

“...the 2017 budget proposes to allocate $1,75 million towards the development of master plans and designs for the three new State universities in Manicaland, Mashonaland East and Matabeleland South, as well as for rehabilitation of existing infrastructure at Epoch Mine for Gwanda State University,” Patrick Chinamasa, the finmin, said in his budget speech on Thursday.

Meanwhile, the Pan-African Minerals University of Science and Technology Bill, as amended, was passed by the National Assembly on July 21.

The Senate has also fast-tracked the Zimbabwe National Defence University Bill -— passed by Parliament on March 8 — but re-opened in Senate on May 19 for a new definition of “minister”. The Bill was promptly approved by Senators and sent to the National Assembly, where it has been waiting ever since.

The 2017 budget proposes to allocate $200,9 million for Higher and Tertiary Education, Science and Technology Development, with $172,5 million allocated for remuneration of staff, inclusive of employees of State universities.

Of the overall budget appropriation, $23,2 million is being appropriated towards the completion of ongoing construction works to alleviate shortage of institutional accommodation, with government pursuing initiatives for mobilising additional financial resources for the construction of halls of residence through joint ventures and issuance of infrastructure bonds, according to Chinamasa.

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