PDP weekly economic policy brief - Zimbabwe's key economic enablers

ZANU (PF) has failed to unlock the potential of our country. The key reason for this is the lack of an inclusive national socio economic vision, chronic leadership failure, patronage, greed, corruption, lack of accountability, and their inability to manage and implement consistent economic policies and developmental projects.

We all know that where there is no vision, any nation will fail and Zimbabwe is classic example of this. We will change that.

PDP's economic blue print HOPE (Holistic Program for Economic Transformation) acknowledges these facts and has identified 13 economic drivers that are key to creating a vibrant and viable economy which is inclusive and allows all Zimbabweans, regardless of race, gender or political affiliation, to pursue their ambition unhindered by the government. Economic freedom is therefore key.

We will only be able to create a competitive and vibrant inclusive economy when we fully utilise our natural resources and effectively combine and manage our exceptional human resources with long term affordable investment capital to produce goods and services that not only meet our local needs, but also increase our export potential.
For the next 13 weeks we shall be briefly looking at these economic drivers. The first economic driver we identify in HOPE is the creation of;

1.    A stable, growing and evenly distributed macro-economy;

Economic stability entails steady economic growth without man-made shocks and crises. This requires that we effectively and continuously anticipate, plan and manage the economy so that we avoid or minimise the negative impact of unanticipated economic shocks and crises, whether they be internal or exogenous.

Typical examples of crisis management include the inability by the ZANU (PF) led government to manage national resources and ensure that we have adequate financial reserves to meet the country's needs, the energy crisis, food insecurity, haphazard changes of economic policy and the resulting lack of policy consistency which leads to a crisis of confidence.

All these create macro-economic instability and discourage long term investment in our economy. These in turn negatively impact on the quality of life of our citizens. In addition, they disadvantage our business sector and potential investors to effectively plan and invest for the long term. This has a quantifiable negative impact on economic growth and job creation.

Evenly distributed economic growth must be inclusive and should maximise our economic output. Unevenly distributed economic growth creates economic inequality and social discontent. In addition, it creates skewed access to opportunity and thus excludes our citizens from participating in the economy. It also results in the inefficient management and allocation of resources as has been the case under the ZANU (PF) led government.

It is unfair and irresponsible for any government to promote particular sectors or areas of the economy, without taking into account the broader needs of all citizens. Our intention as PDP is to deliberately reduce economic and social inequalities while ensuring that every Zimbabwean has a fair shot at opportunity regardless of where they may reside within the country.

A stable economy also arises out of well-regulated but non stifling financial services sector and a consistent and effective monetary policy. The central bank and the financial services sector as a whole therefore, have a key role to play in ensuring macro-economic stability and growth.

In the case of the Reserve Bank of Zimbabwe, it must be independent, non-partisan and objective in implementing monetary policy while the banking sector must be well regulated, always liquid and well managed. ZANU (PF) has failed in all fronts.

Fiscal policy also has a central role to play in macro-economic stability and economic growth. The collection, allocation and effective transparent management of tax revenues is critical. Added to this, must be the minimising of recurrent expenditure by government and an increase in capital formation to improve the productive capacity of the economy and also deliver public infrastructure, goods and services at affordable levels in an equitable manner. This we intend to do.

Lastly we cannot expect a stable macro-economic environment without long term investment capital.  We will therefore ensure that Zimbabwe incentivises domestic investment and attracts the necessary foreign investment capital by removing all laws and regulations that make it unattractive to invest in Zimbabwe.

This means that, among other policies, we must have the rule of law, protect the private ownership of property, repeal indigenisation laws, promote the growth of a vibrant local private sector, relook at tax disincentives, make it easy to do business in Zimbabwe, decisively deal with corruption, create access to long term friendly and affordable capital, promote small businesses, encourage entrepreneurship and minimise unnecessary state intervention in the economy.

The lack of economic growth we are currently experiencing in Zimbabwe is not for lack of resources or ideas, but due to bad leadership, inadequate planning, and rampant abuse of national resources. Corruption and managerial incompetence, patronage, lack of accountability of government, the lack of rule of law and policy inconsistency, among others, continue to arrest our potential. All these lead to macro-economic instability and skewed and inconsistent economic growth.

As PDP we intend to address all these issues holistically so that Zimbabwe can, at last, grow to its full economic potential to the benefit of all its citizens.

Next week we will look at our second economic driver identified in HOPE. This is the effective management of mining resources and the maximisation of benefits therefrom.

Vince Musewe PDP Secretary for Finance and Economic Affairs. Contact details:vtmusewe@gmail.com or +263776917440