HomeNewsBiti under pressure ahead of fiscal review

Biti under pressure ahead of fiscal review

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Finance minister Tendai Biti should introduce properly structured Treasury Bills and restore the Reserve Bank of Zimbabwe’s lender of last resort role when he presents his Mid-Term Fiscal Policy Review, the Confederation of Zimbabwe Industries (CZI) has said.

The review is expected next month.

CZI president Kumbirayi Katsande said the industry lobby group was at the preliminary stage of consulting on the Mid-Term Fiscal policy, but they were looking forward to an improvement of efficiency at border posts and allocation of capital expenditure.

“We are aware the minister is working in limited fiscal space and due to high recurrent expenditure Budget, the amount left to capital expenditure is limited,” he said.

“Over the past, little money left to capital expenditure was being spread thinly to try and cover several projects.
“There is need to focus resources on key bottleneck projects that unlock value to the economy.”

Biti is under pressure after the 2012 National Budget was thrown off the rails following indications that diamond revenue might not meet the projected target of $600 million.

Economist John Robertson said Biti should review his growth projections downwards as diamond revenues had failed to materialise.

“We expect little inflows this year and it seems diamonds revenues have not materialised,” he said.
Biti was relying on the revenues for civil servants’ wages.

“We are all waiting for what will happen next. The government is employing more people than it can afford, ”he said.

Robertson projected a 5% growth in the gross domestic product growth far below the projected 9% at the time of the Budget presentation last year.

In November 2011, Biti announced a $4 billion Budget with $600 million coming from diamond revenues.

At least 60% of the Budget was channelled to salaries and the rest to other expenses. Last month Biti said his ministry had not received funds from diamond mines in Marange.

Zimbabwe National Chamber of Commerce vice-president, Mashonaland region, Davison Norupiri, said they expected a further reduction on duty on raw materials and reintroduction of export incentives.

“We need export incentives to be introduced at the moment as we have a lot of leakages where people are exporting without proper documentation,” Norupiri said.

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