GOVERNMENT should develop an inclusive policy framework that addresses the numerous challenges bedevilling the economy in order to build confidence, the Zimbabwe Coalition on Debt and Development (Zimcodd) has said.
BY MTHANDAZO NYONI
In a statement on the current economic crisis, Zimcodd said there was urgent need to bridge the widening gap between citizens and those who make decisions on their behalf.
The organisation also said government must urgently resolve the currency issue once and for all in order to arrest the multi-tier pricing system obtaining in the market, adding that the current piecemeal approach to solving the country’s economic woes was not yielding positive results.
It said the recently announced fuel pricing model (different prices in bond note and the USD) contradicted the supposed 1:1 parity between United States dollar and bond note.
“Such policy inconsistency perpetuates market distortions,” Zimcodd said.
According to the Confederation of Zimbabwe Industry’s 2018 manufacturing sector survey, major drawbacks for industry included foreign currency and policy inconsistencies.
Zimcodd added that government’s decision to increase fuel prices by 150%, yet still proposed a paltry $41 salary increment for civil servants, was a serious cause for concern.
“The effects of an upward movement in fuel tariffs on the whole economy cannot be overemphasised. In this case, the cost of living shot to unprecedented levels, for instance, Harare commuters are forced to fork out nearly $10 daily for transport to and from work. The government must, therefore, ensure that fuel price increases tally with wage increment,” it said.
“Citizens are wary of inaction by government regarding arbitrage practices in fuel buying and selling on the black market and in this regard, the government should take appropriate action and protect citizens against such acts of economic sabotage.”
Fuel price hikes come on top of the 2% tax on all electronic transactions.
To this, Zimcodd said whilst progressive taxation was necessary, there was need to review the 2% tax which continually burdens the already overtaxed citizens, especially the unemployed and underpaid.
“The tax threshold must, therefore, be raised to a reasonable minimum, taking into account the poverty datum line,” it said.