Opinion / Columnist
Building a strong foundation for future prosperity
03 Aug 2019 at 09:28hrs | Views
The 2019 Mid Year Budget Review presented by the Minister of Finance and Economic Development Prof Mthuli Ncube presented more challenges than solutions for the ordinary Zimbabweans.
The theme of the budget is predicated on "future prosperity" that has an element of neglecting the present challenges bedevelling Zimbabwe. The futuristic approach only confirmed more gloom and doom for now and there is no guarantee for the future either. Ncube has been singing this 'austerity for prosperity' song for quite a while now but none of his promises have come to fruition as yet, hence the growing lack of confidence in his policies
According to the Zimbabwe Vulnerability Assessment 2019 Livelihoods Assessment, 59% (about 5.5 million people) of the rural population will be food insecure during the peak hunger period. Minister Ncube's policy does too little, if at all to inspire confidence that the government has the capacity to, at the very least, ameliorate the dire situation.
"In order to cushion taxpayers against bracket creep & also stimulate aggregate demand for goods and services, we propose to review the tax-free threshold from the current ZW$350 to ZW$700" he said.
Even to the most optimistic, the government's perceivably half-hearted attempts to protect tax payers are just but too feeble and inadequate in this comatose economy. Piece meal changes and tinkering are not the panacea to our problems. We need wholesale changes that are people-centred.
The much anticipated pay rise for civil servants remains a pipe dream. Civil servants have once again come to the realisation that the government is being insincere as far as improving their standards of living is concerned. It appears cushioning allowance was a once off effort to temporarily placate a restive civil service.
Meanwhile, the cost of living continues to skyrocket unabated, and with no credible solution in sight.
Prof.Steve Hanke, an applied economist wrote the following statement on microblogging site, Twitter, "Now that Prof Mthuli Ncube has announced that the government will stop publishing inflation, I am the ONLY source for Zimbabwe's inflation rate. By my current, accurate measure, Zim's annual inflation rate is 558%/yr".
The government's operations are for the most part shrouded in obscurity to the citizens and this latest move to stop publishing inflation smacks of dishonesty and deliberately keeping the public uninformed.
What has the government got to hide from its citizenry. Progressiveness demand openness especially in such important matters that affect the public.Professor Hanke's figures are contrary to the month by month inflation rate presented by the Prof Ncube which projected a 5% inflation rate by Dec 2019. The disparity confirms, government's denial of the crisis posed by the real situation on the ground. Prof Hanke's assertion is the closest of the two to what is obtaining in this dying economy. When a government is in denial, hopes of a lasting solution to the economic challenges are dashed.
The Zimdollar continues to lose value, this is clearly examplified by the shortgaes of basic commodities such as bread, pharmaceuticals, fuel and electricity. Abandoning the multi-currency system has not yielded the results promised by the government. In fact, things have gotten worse as the public and business have shown very little confidence, if any, in the largely discredited Zimdollar. Governments vacillation with regards the use of forex for some payments, reveals confusion and does not help the situation.
Consequently, the government has failed to import goods and services using the interbank rates. Electricity has been scarce in the past few months, with most residential areas recording a 16hr load shedding period per day. Industry has borne the brunt of lack of power and the already low productivity has further declined. Big companies such as Econet have not been spared either as they have been forced to fork out a lot of money to buy diesel for generators, thereby severely disturbing their operations. Agriculture has been harmstrung as well.
Goverment has, with immediate effect, increased the electricity price by 175%.Toll fees were also increased from 2ZWL$ to 10ZWL$ for light motor vehickes,a 400% rise. These price increases are not sustainable because salaries remain the same.
Government introduced an Urban Mass Public Transportation System as a safety net to cushion the public from increases in transport costs. While it is a noble idea to subsidize the transport fees for the public, the queues are a cause for concern. Clearly, government needs to avail more busses to serve the public better.
The policies put in place are too futuristic and mean nothing to the suffering citizens. Moreover, there are no guarantess that these policies will yield the promised results especially given the institutionalised scourge of corruption.The ordinary Zimbabweans continue to languish in poverty under the pretence of laying a foundation of future prosperity. Zimbabwe needs 'now-solutions'.
The theme of the budget is predicated on "future prosperity" that has an element of neglecting the present challenges bedevelling Zimbabwe. The futuristic approach only confirmed more gloom and doom for now and there is no guarantee for the future either. Ncube has been singing this 'austerity for prosperity' song for quite a while now but none of his promises have come to fruition as yet, hence the growing lack of confidence in his policies
According to the Zimbabwe Vulnerability Assessment 2019 Livelihoods Assessment, 59% (about 5.5 million people) of the rural population will be food insecure during the peak hunger period. Minister Ncube's policy does too little, if at all to inspire confidence that the government has the capacity to, at the very least, ameliorate the dire situation.
"In order to cushion taxpayers against bracket creep & also stimulate aggregate demand for goods and services, we propose to review the tax-free threshold from the current ZW$350 to ZW$700" he said.
Even to the most optimistic, the government's perceivably half-hearted attempts to protect tax payers are just but too feeble and inadequate in this comatose economy. Piece meal changes and tinkering are not the panacea to our problems. We need wholesale changes that are people-centred.
The much anticipated pay rise for civil servants remains a pipe dream. Civil servants have once again come to the realisation that the government is being insincere as far as improving their standards of living is concerned. It appears cushioning allowance was a once off effort to temporarily placate a restive civil service.
Meanwhile, the cost of living continues to skyrocket unabated, and with no credible solution in sight.
Prof.Steve Hanke, an applied economist wrote the following statement on microblogging site, Twitter, "Now that Prof Mthuli Ncube has announced that the government will stop publishing inflation, I am the ONLY source for Zimbabwe's inflation rate. By my current, accurate measure, Zim's annual inflation rate is 558%/yr".
The government's operations are for the most part shrouded in obscurity to the citizens and this latest move to stop publishing inflation smacks of dishonesty and deliberately keeping the public uninformed.
What has the government got to hide from its citizenry. Progressiveness demand openness especially in such important matters that affect the public.Professor Hanke's figures are contrary to the month by month inflation rate presented by the Prof Ncube which projected a 5% inflation rate by Dec 2019. The disparity confirms, government's denial of the crisis posed by the real situation on the ground. Prof Hanke's assertion is the closest of the two to what is obtaining in this dying economy. When a government is in denial, hopes of a lasting solution to the economic challenges are dashed.
The Zimdollar continues to lose value, this is clearly examplified by the shortgaes of basic commodities such as bread, pharmaceuticals, fuel and electricity. Abandoning the multi-currency system has not yielded the results promised by the government. In fact, things have gotten worse as the public and business have shown very little confidence, if any, in the largely discredited Zimdollar. Governments vacillation with regards the use of forex for some payments, reveals confusion and does not help the situation.
Consequently, the government has failed to import goods and services using the interbank rates. Electricity has been scarce in the past few months, with most residential areas recording a 16hr load shedding period per day. Industry has borne the brunt of lack of power and the already low productivity has further declined. Big companies such as Econet have not been spared either as they have been forced to fork out a lot of money to buy diesel for generators, thereby severely disturbing their operations. Agriculture has been harmstrung as well.
Goverment has, with immediate effect, increased the electricity price by 175%.Toll fees were also increased from 2ZWL$ to 10ZWL$ for light motor vehickes,a 400% rise. These price increases are not sustainable because salaries remain the same.
Government introduced an Urban Mass Public Transportation System as a safety net to cushion the public from increases in transport costs. While it is a noble idea to subsidize the transport fees for the public, the queues are a cause for concern. Clearly, government needs to avail more busses to serve the public better.
The policies put in place are too futuristic and mean nothing to the suffering citizens. Moreover, there are no guarantess that these policies will yield the promised results especially given the institutionalised scourge of corruption.The ordinary Zimbabweans continue to languish in poverty under the pretence of laying a foundation of future prosperity. Zimbabwe needs 'now-solutions'.
Source - Nkosikhona Dibiti
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