Breaking News

An economy of values and aspirations - Prof Mthuli Ncube

by Prof Mthuli Ncube, Special Correspondent
05 June 2019 | 3998 Views
President Emmerson Mnangagwa commissions new Zupco buses that Government acquired in an effort to ease transport woes in this file photo. The recently introduced ZUPCO subsidies are helping many Zimbabweans on a daily basis as a direct result of a budget surplus. Sensible economics always trickles down

A former US Secretary of the Treasury once noted that, "the budget is not just a collection of numbers, but an expression of our values and aspirations."

Indeed, a culture of overspending and irresponsible finances trickles down and spreads like a disease. It undermines our very basic values and aspirations. And that is why, the most important step, and perhaps the most difficult, in reforming an economy is that initial act of balancing the budget.

In record time, we have made it over this first hurdle. Revenues at RTGS$1.9 billion have outperformed targets (RTGS$1.8 billion) throughout the first quarter of 2019. While expenditures have been contained at RTGS$1.5 billion against a target of RTGS$1.7 billion.

This has led to savings of RTGS$218.9 million, and a budget surplus of RTGS$443.1 million. Government is finally earning more than it is spending.

No deficit. Not even breaking even. But a real budget surplus for Zimbabwe. However, the question I keep hearing is "what does this surplus mean to us?"

Well, the values enshrined in responsible economics have already started to bear fruit.

Even with the uncontrollable outside factors from Cyclone Idai and drought; our progress remains. Our foundations for long-term stability are being built.  Indeed the surplus has already allowed us to tackle these particular crises head on, and with many successes.  

Government, for example, had initially earmarked RTGS$50 million towards mitigating the impact of Cyclone Idai; resources which the targeted welfare of survivors, infrastructure rehabilitation in the areas of roads, bridges, water and sanitation, schools and health facilities, amongst others.

The above allocation, however, has since been doubled to RTGS$100 million to cover the emergency requirements. This would be impossible without the budget surplus.

Likewise, the recent ZUPCO subsidies which are helping so many Zimbabweans on a daily basis are a direct result of this budget surplus. Sensible economics always trickles down.

The structural reforms introduced under the Transitional Stabilisation Programme are therefore providing us crucial breathing room, protecting the economy from failure.

Of course, inflation is yet to be fully tamed. However, fiscal consolidation measures, reinforced with a tight monetary policy stance together with the liberalisation of the exchange rate, are containing previously uncontrolled inflationary pressures.

We must continue to tackle the widespread indiscipline in the foreign exchange market which is still a major source for parallel exchange market premiums feeding into inflation.

This austerity program cannot merely be about balancing the budget.

We have a duty to ensure that we continue to invest in the development of our people and our nation.

During the first quarter, RTGS$12 million was disbursed towards education in support of teaching and learning materials as well as programmes such as student stipend support, school feeding and special needs education.




Likewise, health support amounted to RTGS$33.9 million, including preventative health and medical supplies, primary health care (child and maternal health) and hospital care (hospitals and health care centres).

Not just a balanced budget, therefore, but an ongoing expression of our values and aspirations.

Furthermore, RTGS$16.5 million was disbursed towards a whole variety of social protection programmes such as BEAM, Harmonised Social Cash Transfer, drought mitigation and sustainable livelihoods.

The fiscal position of the country has therefore been turned around in just six months. We leapfrogged the breakeven point, and jumped straight from month-to-month deficit, to month-to-month surplus.

However, this is just the beginning. And patience is required from all as the process of reform gathers pace. We must regain control of our monetary and fiscal policy.

Indeed, what we did on the first of October last year was to begin the process of restoring monetary policy as an additional tool to deal with macro-economic issues.

It is a complicated matter, but crucial to understand. As long as we were pegged to the dollar, we could not respond, or manage our monetary policy; inflation was out of our control.

It is quite clear that we need to move towards having our own domestic unit account and the RTGS$ is the beginning of that.  But it is a process. You cannot run before you can walk.

And our economic legs have been broken for too long, we must first recover and get back on our feet before racing ahead with a full on new domestic unit.

We must continue to fine tune the interbank market making it more efficient whilst also putting in place the micro institutions for making sure that monetary policy begins to work.

One of the things that we have done in order to boost our balance of payment position, is to put in place a US$500 million facility which we have sourced from outside of Zimbabwe in order to deal with demands for meeting external payments from importers and others.

While this of course is not a long term solution, a wounded economy sometimes needs crutches, aid, or support from friends on the tough road to recovery.

But we are making great strides, and progress is real. We have a surplus in both RTGS and US$.

This is no small achievement.  This is the culmination of tough economic decisions, a nation pulling through and working together, and a new economy being rebuilt for a new Zimbabwe, on the shared values of responsibility, progress, and aspiration towards prosperity.

Hon. Prof Mthuli Ncube
Zimbabwe's Minister of Finance and Economic Development


Mthuli Ncube Mnangagwa Zupco


Disclaimer:
All articles and letters published on Bulawayo24 have been independently written by members of Bulawayo24's community. The views of users published on Bulawayo24 are therefore their own and do not necessarily represent the views of Bulawayo24. Bulawayo24 editors also reserve the right to edit or delete any and all comments received.

Source: Prof Mthuli Ncube

Comments

Latest News

'Zimbabwe sliding into authoritarian rule'

by Mandla Ndlovu | 17 September 2019 | 1 Views

List of alleged individuals targetted by army leaked

by Mandla Ndlovu | 17 September 2019 | 2 Views

Mawarire calls for ZEC to be dissolved

by Mandla Ndlovu | 17 September 2019 | 3 Views

Mnangagwa owns CBZ bank?

by Mandla Ndlovu | 17 September 2019 | 6 Views

Zimbabwe Communist Party speaks on abducted doctor

by ZCP | 17 September 2019 | 5 Views

Chiwenga to kick out Mnangagwa?

by Mary-Kate Kahari/Malvin Motsi | 17 September 2019 | 11 Views

Mnangagwa heartless - Dear EditorIt saddens me to see that E.D. Mnanga...

by Vusa Sigola | 17 September 2019 | 2 Views

No to Mugabe mausoleum - The Zimbabwe Campaign for Good Governance (ZC...

by Morgan Changamire | 17 September 2019 | 2 Views

Work on Mugabe's grave house begins - The construction of a mausoleum ...

by Staff reporter | 17 September 2019 | 1 Views

Ramaphosa revisits booing nightmare during Mugabe funeral

by newzimbabwe | 17 September 2019 | 5 Views

Chief Zvimba blasts Mugabe's nephew

by Staff reporter | 17 September 2019 | 4 Views

Striking doctors blocked from confronting Mnangagwa

by newzimbabwe | 17 September 2019 | 4 Views

Mugabe Memorial: Family reflects on 'empty' stadium - While the Zimbab...

by Staff reporter | 17 September 2019 | 1 Views

Mnangagwa's minister condemns doc's 'abduction' - THE Minister of Heal...

by Staff reporter | 17 September 2019 | 4 Views

MDC-Alliance members urged to 'repent' and join Zanu-PF - MDC-Alliance...

by Staff reporter | 17 September 2019 | 8 Views

RBZ explains exchange rate depreciation - THE depreciation of the Zimb...

by Staff reporter | 17 September 2019 | 4 Views

CIO rubbishes connection to missing doctor's case - The Zimbabwe Repub...

by Staff reporter | 17 September 2019 | 4 Views

Man torches ex-lover's hut - A LUPANE villager has been slapped with a...

by Staff reporter | 17 September 2019 | 2 Views

Zapu retiring its old guard

by Staff reporter | 17 September 2019 | 4 Views

Zvimba chiefs felt betrayed over Mugabe controversy - The late former ...

by Staff reporter | 17 September 2019 | 1 Views

Lobby for 24-hr clinics taken to Parliament - PARLIAMENT has referred ...

by Staff reporter | 17 September 2019 | 1 Views

Chamisa's MDC to roll out more demos

by Staff reporter | 17 September 2019 | 2 Views

Mugabe family feuds over body

by Staff reporter | 17 September 2019 | 1 Views

Two die in mine blast - TWO Kadoma illegal gold miners died last week ...

by Simbarashe Sithole | 16 September 2019 | 187 Views

In Pictures: Ramaphosa sends envoy to Nigeria over Xenophobia

by Staff Reporter | 16 September 2019 | 336 Views

Truck crashes into State House

by Staff Reporter | 16 September 2019 | 1570 Views

Entertainment

Hip-hop top 10 spansers

by Staff Writer | 12 September 2019 | 921 Views

Victoria Falls cancels Babes Wodumo gig over xenophobia

by Mandla Ndlovu | 12 September 2019 | 1582 Views

Harare Wellness Festival a huge success

by Mandla Ndlovu | 09 September 2019 | 618 Views

BREAKING: Dr Malinga cancels Skyz Metro FM gig over xenophobia

by Mandla Ndlovu | 05 September 2019 | 1879 Views

Mlindo the Vocalist fears xenophobic attacks in Zimbabwe

by Mandla Ndlovu | 04 September 2019 | 7904 Views

Green dupes Bindura fans - AFRO FUSION musician Carlos Green aka "vaku...

by Simbarashe Sithole | 01 September 2019 | 824 Views

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

by Staff Writer | 21 August 2019 | 401 Views

Rebecca Malope retires

by Mandla Ndlovu | 20 August 2019 | 6611 Views
iBlog

Tb Joshua Worst Enemy Angelique Tonge Exposed

About two years ago, we came out emphatically about those behind the t.b joshua watch. many were those who thought we were framing innocent people up or on a witch hunt. some events have vindicated us and the cat is out of the bag. it is said that no... Read More
pointblank 01 May 2015 ago

Hp Omen 15-5116tx – The Next Generation Gaming Laptop

the hp omen 15-5116tx is being targeted at the performance hungry gamers. it comes in a single variant boasting an eye-catching attractive design. the notebook offers a slim, lightweight chassis and appears like a piece of art than an actual gaming... Read More
Sergey 11 June 2015 ago