Breaking News

Tighten your belts till 2020, says Mthuli Ncube

by Staff reporter
26 April 2019 | 5735 Views
Finance minister Mthuli Ncube has said austerity measures adopted by government to cap expenditure and free up funds for capital projects are expected to ease the burden on the taxpayer next year.

Zimbabwe which is currently operating on limited fiscal space and no budgetary support adopted a cocktail of belt-tightening measures and taxes that have largely eaten into consumers spending power.

Under the new economic blueprint, the Transitional Stabilisation (TSP), government undertook a raft of reforms which seek to attract foreign direct investment, boost domestic production and contain expenditure. Official figures show that wages and recurrent expenditure currently account for over 90 percent of government revenue.

The TSP was launched in October last year as an economic blueprint to stimulate growth after President Emmerson Mnangagwa was elected into office last year. The economic plan is also seen as a precursor to government's aspiration of creating a middle income economy by 2030.

In his address at the ZITF international business conference in Bulawayo yesterday, Ncube said austerity will be a thing of the past by next year.

"Next year we will be starting entering the prosperity period because my understanding is that it can only be austerity for a year and you cannot have austerity for three years that's not fair. The beginning of next it will be less and less austerity," Ncube said.

Austerity measures have seen government cutting expenditure and reviewing tax heads such as the intermediated transfer tax and excise duty on fuel to raise more revenue to meet government's growing obligations.

Ncube said government was solvent with the Treasury recording an average of ZWL$100m monthly surplus, a figure critics say could be too little given the weakening of local currency against major currencies. Treasury is targeting above ZWL$200m per month.

The finance minister said government ensure that the interbank market operates efficiently to reduce market distortions. Premiums on the formal market are currently lagging behind parallel market rates which are nearly approaching the 500 percent mark.

Ncube said treasury was not injecting new money into the economy, blaming speculative behaviour for the movements on the informal market.

"Money supply is not growing on the market and my question is where the pressure for foreign currency is coming from. That has mainly been driven by speculation in the market and I urge private sector to utilise the interbank market," said Ncube.

Mthuli said efforts are underway to reform state enterprises so that their contribution to GDP is enhanced.

Ncube said despite the headwinds the domestic economy remains on a growth trajectory adding that government has set a per capita income target of at least $4,500 by 2030. The figure is currently below $1,000.

This implies growth in nominal GDP from 2018 levels around ZWL$25bn to around ZWL$65bn by 2030.

Ncube said the private sector was expected to stimulate growth with Zimbabwe assuming the position of a factory to the world.

Ncube said payments towards clearance of domestic debt amounted to ZWL$1,62bn in 2018. The domestic debt topped ZWL$9,6bn in September last year as government borrowed from the domestic market to finance the budget deficit. Government has been borrowing from the domestic market through the issuance of Treasury Bills, a move analysts say was crowding out the private sector as banks turns to the securities instead of giving loans.

In January and February 2019 payments towards domestic debt amounted to ZWL$195m, Ncube said.

Mthuli Ncube Austerity 2020

Source: businesstimes


Latest News

BREAKING: Phelekezela Mphoko given ZW$1 000 bail

by Mandla Ndlovu | 21 August 2019 | 1 Views

Zimbabwe plunged into darkness again - Zimbabwe has rolled back into d...

by Staff reporter | 21 August 2019 | 1 Views

Political freedoms are not respected in Zimbabwe

by Bigboy Sibanda | 21 August 2019 | 2 Views

Ibutho leNqama press release on Chief Ndiweni issue

by Ibutho leNqama Spokesperson | 21 August 2019 | 3 Views

'Regime change!' is a desirable consequence of free elections and not ...

by Patrick Guramatunhu | 21 August 2019 | 1 Views

Signs of economic resuscitation rattle MDC - Indications of economic s...

by John Sigauke in Namibia | 21 August 2019 | 4 Views

Zanu-PF eyes Zaka by-election triumph - Zanu-PF's Zaka East by-electio...

by Staff reporter | 21 August 2019 | 1 Views

Scotch cart accidents kill 3

by Staff reporter | 21 August 2019 | 4 Views

Man 'kills' cousin, pretends to be an informant - A TOUT from Bulawayo...

by Staff reporter | 21 August 2019 | 8 Views

'Regime change!' is a desirable consequence of free elections and not ...

by Patrick Guramatunhu | 21 August 2019 | 9 Views

Mnangagwa: Reformist, corruption buster chimera - PRESIDENT Emmerson M...

by Paidamoyo Muzulu | 21 August 2019 | 2 Views

Mnangagwa dragged into Mphoko, Zacc fight - FORMER Vice-President Phel...

by Staff reporter | 21 August 2019 | 6 Views

Mphoko, ZACC strike deal

by ZimLive | 21 August 2019 | 10 Views

Mnangagwa denies Majonga 'love rivalry' allegations

by Staff reporter | 21 August 2019 | 20 Views

Allan Gray hopes that courts rule in Trevor Manuel's favour against Pe...

by Staff reporter | 21 August 2019 | 6 Views

ZANU PF youth leader attacks Jonathan Moyo

by Mandla Ndlovu | 21 August 2019 | 6 Views

Latest on MDC Masvingo mass demonstrations

by Mandla Ndlovu | 21 August 2019 | 3 Views

'Phelekezela Mphoko guarded by CIOs'

by Staff Reporter | 21 August 2019 | 9 Views

Chamisa will never dance to Mnangagwa's tune

by Staff Reporter | 21 August 2019 | 7 Views

'Mnangagwa threatened to kill Majonga over High school lover'

by Mandla Ndlovu | 21 August 2019 | 16 Views

Biti takes on Mnangagwa

by Daniel Itai | 21 August 2019 | 5 Views

Andersen Global comes to Zimbabwe

by Staff reporter | 21 August 2019 | 4 Views

Chief Ndiweni's dilemma: A balanced analysis

by L Dube | 21 August 2019 | 10 Views

Never promise anyone something you are never sure to fulfil - The resi...

by Thomas Murisa | 21 August 2019 | 6 Views

Mnangagwa's govt frightened to the core, says Coltart

by Staff reporter | 21 August 2019 | 11 Views

West steps up pressure on Mnangagwa - The government appears to have s...

by Staff reporter | 21 August 2019 | 6 Views

Chamisa's MDC in crisis meeting - THE opposition MDC's top leadership ...

by Staff reporter | 21 August 2019 | 3 Views


Top 5 PS2 ISOS to play with friends you can get right now

by Staff Writer | 21 August 2019 | 1 Views

Rebecca Malope retires

by Mandla Ndlovu | 20 August 2019 | 1842 Views

Famous women in the gambling industry

by Staff Writer | 20 August 2019 | 346 Views

Zimfest delivers another 'phenomenal' festival

by Tidi Kwidini | 07 August 2019 | 636 Views

Should you be betting on reality TV show outcome too?

by Staff Writer | 05 August 2019 | 86 Views

WATCH: Jah Prayzah featuring Iyasa Sadza nemuriwo song

by Mandla Ndlovu | 23 July 2019 | 5680 Views

Muvhango star Marang Phala visits Prophet Sovi's church

by Mandla Ndlovu | 22 July 2019 | 9626 Views

Greatsoftline For All Of Your Software Needs

coupon and promo codes: greatsoftline for all of your software needswhile some online sellers have promotional services that reduce the overall amount you spent, others do not .you need to be on the lookout for the best outlets in order to chase th... Read More
ITnews 25 February 2015 ago

Five Reliable Outlook Pst File Repair Tools

Outlook pst files can become corrupted -- and when that happens, work grinds to a halt. if your organization relies on outlook, one of these tools could save the day. outlook is the industry standard groupware tool. let's take a look at five that can... Read More
ITnews 04 May 2015 ago