AFTER taking a knock, shedding nearly 3% of its size during the first quarter due to uncertainty, Zimbabwe’s economy is in need of a captain to retain the momentum gathered after the formation of the inclusive government.
Ndamu Sandu/Bernard Mpofu
Although the coalition was characterised by discord, the post-formation euphoria managed to stimulate growth, making Zimbabwe’s economy one of the fastest growing in the region.
The economy has registered successive growth rates since 2009, following a decade of recession.
Successive growth rates have been attributed to a stable political and economic environment brought about by the inclusive government and improvements in agriculture and mining.
Job cuts, limited long-term capital, lack of confidence in central government are, but some of the challenges confronting the soon-to-be-appointed Finance minister.
The question many would ask is: What are the qualities of a Finance minister?
Brian Ngwenya, an economic and political analyst based in Bulawayo, says President Robert Mugabe should appoint a “mover and shaker” to head the Finance ministry. He said Mugabe should shy away from the politics of patronage and endorse a person respected both within and outside government.
“One of the greatest challenges that the new Finance minister faces is striking a balance between economic sense and populist policies. Our economy is not well and only a person of integrity can drive it,” Ngwenya said.
The new Finance minister faces a herculean task to allocate stagnating revenues against the background of a bloated public sector wage bill.
The new Constitution has created new bureaucrats at a time when the economy is need of fresh capital.
Ngwenya added that Mugabe should form a lean Cabinet and minimise duplicity. The coalition government had several ministries that were duplicated, which include Justice and Constitutional Affairs (Justice ministry); Regional Integration and Foreign Affairs and co-ministers of Home Affairs.
Critics warn that a push by Zanu PF to intensify indigenisation and empowerment regulations compelling foreign-owned companies to sell controlling stakes to locals may have a boomerang effect on the economy.
An analyst with a commercial bank said a background in economics is a good foundation for a Finance minister.
He said the President can “outsource” the services of the minister from non-politicians since he is mandated to do so under the new Constitution.
“Politicians tend to ignore the economy. Someone who is not a politician will improve confidence which is lacking in the economy,” the analyst said.
Zimbabwe has recorded an average annual growth rate of 7% since 2009.
In his mid-term fiscal policy review statement last month, outgoing Finance minister Tendai Biti revised growth projections for 2013 to 3,4% from 5% due to underperformance of key sectors — agriculture and mining.
In a June interview with our sister paper, The Standard, Biti said one has to be strong, honest and trustworthy to become Finance minister in a fragile country.
He said the next Finance minister should have craft competence and “understanding your subject and you must be prime driver of what is good for the economy”.
One must be very strong in defending that which is good for the economy.
He said Zimbabwe’s Finance minister must be a team player and earn respect of colleagues. Biti added that the head of Treasury has to be hot-headed and stick to the book and must have a good team of professionals.
“There are some decisions which in the short-term might be very unpopular, but in the long-term will be for the good of the nation. I would have liked to give a 2 000% salary wage increase for civil servants, but it’s not possible,” he said.