Business / Economy
Biti adjusts 2012 Budget to $4 billion with $600 million expected from diamonds
25 Nov 2011 at 06:40hrs | Views
HARARE - Finance Minister Tendai Biti has adjusted the 2102 budget to $4 billion from $3.4 billion after the ministry of Mines and Mining Development assured him $600 million or more will come from the resumption exports of diamonds in Marange.
Biti said the economy will grow by 9.3% this year and is likely to continue its strong recovery next year to 9.4%, underpinned by positive performance in finance (23%), mining (15.8%), tourism (13.7%), agriculture (11.6%), manufacturing (6%), and transport and communication (6%).
Agriculture is projected to grow growth 11.6% in 2012 while maize production should hit 1.8 million tonnes from 1.45 million this year and nearing the peak of 2.2 million metric tonnes in 1996.
Tobacco which was revised to 133 million kgs this year from the initial 170 million kgs is expected to be 150 million kgs in 2012.
Sugar at 259 000 tonnes is projected to increase to 400 000 tonnes next year.
In mining 15.9% growth is projected for the mining sector in 2012. Gold is forecast at 15 tonnes but will grow to 28 tonnes after the recapitalisation of Fidelity Refiners.
He added there had been significant increase in the manufacturing sector's capacity utilisation to 57.2%, from 43.7% last year and the sector is is projected to register a 6% growth in 2012. Sub-sectors anticipated to drive growth in manufacturing will include food stuffs (6%), wood and furniture (8%), metals and metal products (11%), and non-metal products (25%).
Tourism is expected to grow 37% next year and a significant amount of money had been set aside to prepare for the UNWTO to be hosted by Zimbabwe and Zambia in 2013.
ICTs remained the fastest growing sector of the economy with mobile phone subscribers increasing to 8.1 million from 7.7 million last year.
Construction is forecast to grow 1% 2011 and 1.5% in 2012.
On inflation Biti said the major drivers of inflation were the cost of rentals which he said it costs $10 to rent a room in Lusaka comparing with $50 in Harare. Alcohol is also a major driver of inflation while food inflation is not moving. Projections to year end, however, show annual average inflation remaining within the targeted range of 3.5-4.5%.
In the financial services sector total deposits at $3.3 billion as of September 8 are expected to increase to $3.8 billion in 2012 of which about 80% will be available for lending.
Lending to the productive sectors grew to $2.59 billion over the period, constituting 78.4% of total deposits. Primary beneficiaries were in the sectors of agriculture (18%), manufacturing, (20%), distribution (19%) and mining (6%).
Individuals $247 million, construction $108 million and communications $108
Exports are estimated to grow by 30.2% in 2011 and a further 15.3% in 2012. This translates into total export earnings of $4.4 billion and $5.1 billion, respectively. Main exports remain mineral commodities, tobacco and manufactured products.
Main exports destinations for the period 2009 to 2011, among others, include South Africa (56%), China (6%), United Arab Emirates, Mozambique, Switzerland, and Zambia, each with 3%, among others.
Import growth is, however, estimated to decelerate from 23.3% in 2011 to 6.8% in 2012. This accounts for total imports of about $6.4 billion in 2011 and $6.8 billion in 2012, implying a trade and respective current account deficit of $2 billion in 2011 and $1.7 billion in 2012.
Most of the imports are coming from South Africa (52%), the United States (11%), Kuwait (6%) and China (5%).
Biti also said about $618 million had come from the development partners like USAid, DFID, EU and Australia in mainly in humanitarian assistance, targeting health, education and social protection programmes, as well as agriculture, energy, water and sanitation, and governance.
Revenue stood at $2.1 billion against expenditure of $1.9 billion. Of the total revenue collections to September, major contributors were VAT (31%), PAYE (20%), customs duty (12%) and excise duty (11%).
Among the top 10 contributors to VAT were Delta, Zesa, Econet, TelOne, Telecel and Nestle while top PAYE contributors included Zimplats, ZEDTC, Econet, Bulawayo City Council and Delta.
Corporate tax major contributors were Econet, CBZ, Delta, MMCZ and Stanbic, Blanket Mine, Mbada Diamonds among others.
Total expenditures to September reproduced the perennial challenge of disproportionate share of recurrent expenditures at $1.68 billion, against capital expenditures of $192 million.
Revenue measures
Customs duty on raw materials reduced.
Suspension of duty on products which the local industry has potential to produce, until such time when production improves.
Duty increased on certain fresh farm produce from Jan 1 next year.
Retained duty on maize meal and cooking oil necessitated by the achievement of the strategic grain reserves
Pre-packed Rice,Flour and salt duty introduced
Textiles and clothing 40%+$3 a kg from 40%+/$1.50 per kg
Tax free threshold increased to $250 from $225
Bonus tax exempt upped to $700 from $500 with effect from November
Excise duty on locally produced cigarettes increased from $7 to $10 per 1 000 sticks.
Excise duty on imported cigarettes from 40% plus $5 per 1 000 sticks to 40% plus $7 per 1 000 sticks
Customs duty on donated goods to sports associations registered with the Sports and Recreational Commission scrapped
Platinum mining royalties increased to 10% while the levy on gold goes up to 7% from 4.5%
For the full document download >>>>> HERE.
Biti said the economy will grow by 9.3% this year and is likely to continue its strong recovery next year to 9.4%, underpinned by positive performance in finance (23%), mining (15.8%), tourism (13.7%), agriculture (11.6%), manufacturing (6%), and transport and communication (6%).
Agriculture is projected to grow growth 11.6% in 2012 while maize production should hit 1.8 million tonnes from 1.45 million this year and nearing the peak of 2.2 million metric tonnes in 1996.
Tobacco which was revised to 133 million kgs this year from the initial 170 million kgs is expected to be 150 million kgs in 2012.
Sugar at 259 000 tonnes is projected to increase to 400 000 tonnes next year.
In mining 15.9% growth is projected for the mining sector in 2012. Gold is forecast at 15 tonnes but will grow to 28 tonnes after the recapitalisation of Fidelity Refiners.
He added there had been significant increase in the manufacturing sector's capacity utilisation to 57.2%, from 43.7% last year and the sector is is projected to register a 6% growth in 2012. Sub-sectors anticipated to drive growth in manufacturing will include food stuffs (6%), wood and furniture (8%), metals and metal products (11%), and non-metal products (25%).
Tourism is expected to grow 37% next year and a significant amount of money had been set aside to prepare for the UNWTO to be hosted by Zimbabwe and Zambia in 2013.
ICTs remained the fastest growing sector of the economy with mobile phone subscribers increasing to 8.1 million from 7.7 million last year.
Construction is forecast to grow 1% 2011 and 1.5% in 2012.
On inflation Biti said the major drivers of inflation were the cost of rentals which he said it costs $10 to rent a room in Lusaka comparing with $50 in Harare. Alcohol is also a major driver of inflation while food inflation is not moving. Projections to year end, however, show annual average inflation remaining within the targeted range of 3.5-4.5%.
In the financial services sector total deposits at $3.3 billion as of September 8 are expected to increase to $3.8 billion in 2012 of which about 80% will be available for lending.
Lending to the productive sectors grew to $2.59 billion over the period, constituting 78.4% of total deposits. Primary beneficiaries were in the sectors of agriculture (18%), manufacturing, (20%), distribution (19%) and mining (6%).
Individuals $247 million, construction $108 million and communications $108
Exports are estimated to grow by 30.2% in 2011 and a further 15.3% in 2012. This translates into total export earnings of $4.4 billion and $5.1 billion, respectively. Main exports remain mineral commodities, tobacco and manufactured products.
Main exports destinations for the period 2009 to 2011, among others, include South Africa (56%), China (6%), United Arab Emirates, Mozambique, Switzerland, and Zambia, each with 3%, among others.
Import growth is, however, estimated to decelerate from 23.3% in 2011 to 6.8% in 2012. This accounts for total imports of about $6.4 billion in 2011 and $6.8 billion in 2012, implying a trade and respective current account deficit of $2 billion in 2011 and $1.7 billion in 2012.
Most of the imports are coming from South Africa (52%), the United States (11%), Kuwait (6%) and China (5%).
Biti also said about $618 million had come from the development partners like USAid, DFID, EU and Australia in mainly in humanitarian assistance, targeting health, education and social protection programmes, as well as agriculture, energy, water and sanitation, and governance.
Revenue stood at $2.1 billion against expenditure of $1.9 billion. Of the total revenue collections to September, major contributors were VAT (31%), PAYE (20%), customs duty (12%) and excise duty (11%).
Among the top 10 contributors to VAT were Delta, Zesa, Econet, TelOne, Telecel and Nestle while top PAYE contributors included Zimplats, ZEDTC, Econet, Bulawayo City Council and Delta.
Corporate tax major contributors were Econet, CBZ, Delta, MMCZ and Stanbic, Blanket Mine, Mbada Diamonds among others.
Total expenditures to September reproduced the perennial challenge of disproportionate share of recurrent expenditures at $1.68 billion, against capital expenditures of $192 million.
Revenue measures
Customs duty on raw materials reduced.
Suspension of duty on products which the local industry has potential to produce, until such time when production improves.
Duty increased on certain fresh farm produce from Jan 1 next year.
Retained duty on maize meal and cooking oil necessitated by the achievement of the strategic grain reserves
Pre-packed Rice,Flour and salt duty introduced
Textiles and clothing 40%+$3 a kg from 40%+/$1.50 per kg
Tax free threshold increased to $250 from $225
Bonus tax exempt upped to $700 from $500 with effect from November
Excise duty on locally produced cigarettes increased from $7 to $10 per 1 000 sticks.
Excise duty on imported cigarettes from 40% plus $5 per 1 000 sticks to 40% plus $7 per 1 000 sticks
Customs duty on donated goods to sports associations registered with the Sports and Recreational Commission scrapped
Platinum mining royalties increased to 10% while the levy on gold goes up to 7% from 4.5%
For the full document download >>>>> HERE.
Source - zfn
