Over the past year, there has been much talk about Vision
2030, our national growth strategy to transform Zimbabwe into a Prosperous and
Empowered Upper Middle Income Society by the end of the next decade.
There has been less talk, however, about how we are going
to get there, and the specific steps we are planning to take. Government is
asking for patience and understanding from its citizens, and it is therefore
important that we clearly communicate not only where we are going, but also how
we will get there.
The starting point for our journey is stabilisation. Aware
of the difficult reality in which we are operating, the first step is to
stabilise the economy to provide a solid foundation for sustainable economic
growth.
The vehicle for this is the Transitional Stabilisation
Programme (TSP), an immediate term economic policy strategy containing a set of
reforms and interventions to stabilise the economy over the next two years.
This is the first step towards the realisation of Vision
2030, and will be followed by two successor plans, that will lead us to the
Promised Land.
The TSP is a highly realistic document. It acknowledges our
starting point: An economy having to contend with a high budget deficit and
significant debt after years of mismanagement.
These challenges are significant, but with major structural
reform, they are not unsurmountable. What is required is bold action and a
willingness to take tough decisions. We cannot bury our heads in the sand — the
longer we wait to address our challenges, the harder it will be.
The main focus therefore is on the need to urgently correct
the mismanagement of the budget. For years, Government has been spending much
more than it had, which destabilised the economy. Simply put, when we came to
this office, our national wallet was empty and we had significant debt. Our
strategy is to cut down Government spending — through eradicating unnecessary
expenses and waste — while widening the income base. We can no longer spend
what we do not have.
TSP therefore seeks to reduce Government expenditure to
make room for developmental projects and programmes which support production.
This also includes the privatisation and reform of inefficient parastatals to
increase their contribution to the economic development of the country, and
reduce their drain on the Government. They must shift from being a burden to an
asset.
Of course, cutting spending and increasing taxes are not
popular measures, and they are not pain-free. Many people are struggling and we
are aware that we are asking for increased patience, understanding and
sacrifice at an already difficult time.
But this is the only way. The TSP is like a doctor
performing life-saving surgery on the Zimbabwean economy. Yes, the surgery will
cause pain, but this pain is the first step towards recovery.
These austerity measures are not across the board, and the
TSP is designed to ensure that the most important developmental and
infrastructure projects get more, not less, funding. As we cut non-essential
spending, the TSP increases funding to the education and health sectors, as
well as social protection and gender mainstreaming.
Similarly, priority is given to investment in
infrastructure such as roads, rail and electricity, with an emphasis on the
completion of ongoing infrastructure projects while pursuing alternative
financing mechanisms such as private public partnerships.
Equally important is stimulating production in the
agriculture, mining and manufacturing sectors, so that we begin to produce more
of our own products and goods. This way, we will import less and export more,
bringing in foreign currency, creating jobs and reducing prices.
The service sector also has a large role to play. Tourism
has been identified as a high-potential area to increase revenue with minimum
capital outlay. This potential was recognised by the Lonely Planet and National
Geographic, two of the world’s top travel publications, who both listed
Zimbabwe in their top 10 “must visit” destinations for 2019.
When it comes to attracting investment, improving the ease
of doing business and enhancing efficiency are key facets of the TSP as we put
in place concrete steps to support the President’s “Zimbabwe is Open for
Business” message. Improving our banking, information, communication,
insurance, and technology sectors will further strengthen the business
environment, as will the ongoing measures to fight corruption.
Investors are also influenced by the political environment.
The TSP, therefore, recognises the importance of good governance by ensuring
the rule of law prevails, protecting property rights as well as democratisation
of the political space. This also includes the need to immediately align all
outstanding statutes to the Constitution.
The targets we have set ourselves are ambitious but
attainable, and the sacrifices we make today will be repaid many times over in
the years to come. The TSP is the first step of a bold, concrete and
comprehensive plan to restructure, rebuild and reform our economy, putting us
on the path to steady economic growth. The road to our Vision 2030 is bumpy and
full of potholes, but with careful navigation and discipline, we will realise
our vision.
Prof Ncube is the Minister of Finance and Economic
Development. This piece is the first of a series articles he is writing
exclusively for The Herald outlining the economic trajectory in line with
President Mnangagwa’s Vision 2030.
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