PRESIDENT Robert Mugabe could soon sign into law a piece of legislation compelling diamond companies in Marange to remit 50% of their revenue to Treasury amid concerns of opaqueness in mining operations and underperformance of gem revenues, Finance minister Tendai Biti has said.
Report Bernard Mpofu
Presenting the monthly state of the economy report in the capital yesterday, the Finance minister said the underperformance of diamond revenue at a time when the nation was making frantic efforts to raise funds for the forthcoming polls had necessitated the crafting of the piece of legislation.
Total revenue as at March 28 2013 stood at $241 million against a target of $301,18 million, implying a negative variance of over $60 million driven tax revenue.
Fiscal Developments (Jan-28 March 2013) | Create infographicsThe performance of public finances remains under pressure from huge expenditure demands against limited revenue earnings.
“All is not well in the State of Rome,” Biti said.
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“We received nothing at all in January from diamonds, nothing at all in Februray. In March, we received $5 million against a target of $15 million. If Caesar was going to receive what belongs to Caesar, we would be halfway through (in financing) the elections. So this situation is not acceptable.
“As Minister of Finance at the special request of the principals, and with the able help of the Attorney-General, we have crafted a statutory instrument which is now awaiting Presidential signature (I took it to the President last Friday). This statutory instrument will make sure that we get at least (at source) 50% of our diamond revenue. Some of us in Cabinet continue to behave as if we are shareholders in these diamonds mines. It is unacceptable.”
The external sector, according to the Finance minister, also continued to face a mounting trade and current account deficit, amid negligible capital inflows, thereby exerting pressure on the balance of payment position.
Official figures show that as at March 15 2013, monthly exports stood at $196 million, while cumulative exports since January amounted to $689 million.
Imports during the first half of March stood at $294 million, while cumulative imports since January stood at $1,73 million, translating into a trade deficit of over $1 billion within the first quarter of the year.
