EDITORIAL COMMENT: Embrace austerity measures to mend economy

by Sunday News Online | Sunday, Oct 7, 2018 | 874 views
President ED Mnangagwa

President ED Mnangagwa

THE Government has hit the ground running in making sure that measures are put in place to resuscitate the economy and ensure a better quality life for all.
President Mnangagwa said it loud and clear that top on the priority list is to revive the country’s economy, and the Cabinet has been busy coming up with strategies and policies to attract foreign and domestic investment.

Nonetheless, what Zimbabweans should bear in mind is that some tough decisions have to be made to make things move, and what is needed is patience and support to the Government.

People have to appreciate where the country is coming from in economic terms, and understand that new policies and strategies must be given time to bear fruit, though the Government has maintained that it has come up with some quick win strategies to jump start the economy.

Last week, Cabinet  approved for immediate implementation the Transitional Stabilisation Programme announced by Finance and Economic Development Minister Professor Mthuli Ncube.  Information, Publicity and Broadcasting Services Minister

Monica Mutsvangwa told the media that Cabinet deliberated on the measures after a presentation by Prof Ncube before adopting them.

“The implementation process will accordingly commence this month and run up to December 2020. The launch of the programme is to take place very soon,” said Minister Mutsvangwa.

She said the programme’s main thrust is to ensure the stabilisation of the macro-economic environment that include the financial sector, introduction of necessary policy and institutional reforms to facilitate private sector led economic growth and the launch of the quick win projects and programmes to stimulate economic growth.

“Implementation of the quick win projects and programmes will be undertaken in 100 Day Cycles guided by the Rapid Results Approach. The Transitional Stabilisation Programme constitutes the first phase of the implementation of the Vision 2030 and will thus pave way for the implementation of two successive Five-Year Development Plans which are to run from 2021 to 2030,” said Minister Mutsvangwa.

The Minister said key features and objectives included addressing various existing and external and macro-economic imbalances, thus providing a foundation for robust economic growth and development beyond 2020.

They also include strengthening fiscal responsibility and management of Government expenditures so as to divert resources from recurrent expenditure to productive activities, facilitate innovation in the design and administration of taxes to include simplified tax structures for micro, small and medium enterprises.

“Other features include targeting the eradication of corruption, which is a major source of leakages to public revenues and a cost burden to businesses. Instituting measures that seek to strengthen the economy’s balance of payments in order to enhance exports, currency competitiveness and capital inflows and reduce over dependency on imports,” she said.

Other features included the desire to rationalise the civil service so as to reduce the unsustainable public sector wage bill.
Minister Mutsvangwa said Cabinet had also considered the Zimbabwe Investment and Development Bill that was presented by Industry and Commerce Minister, Nqobizitha Ndlovu.

In addition, Finance and Economic Development Minister Professor Ncube assured Foreign Currency Account (FCA) holders that Government will not raid their hard currency, instead adequate measures will be put in place to ring-fence them.

Prof Ncube said the decision by the old dispensation in which corporates, embassies and individuals lost their hard currency after they were raided will not “happen again under my watch” as people would access their money on demand.

The assurance came after individuals and corporates raised concern on the “safety” of the foreign currency accounts, obviously thinking of what happened in the past.

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