The turbulent years of 2004-2008 saw Tawanda abandoning his coffin making business to engage in full time money changing, commonly referred to as Chigweja. The formation of the inclusive government and the hopes for a stable macro-economic environment saw Tawanda re-investing earnings in his coffin-making business. His hopes were further brightened when the newly appointed Minister of Finance took to the podium to deliver his maiden fiscal policy for 2010. For some time the informal sector was a forgotten territory remembered only during election time when funds, loans and schemes would be availed to the sector only to be forgotten soon after elections.
In just about four weeks Finance Minister Tendai Biti will once again present his second fiscal policy statement before an expectant country. Various economic sectors will be looking for measures which will provide the jump as well as the stabilization measures outlined to the ministry through the outreach budget consultations.
Addressing participants at a budget consultation meeting, Biti sounded warning bells of an even tighter budget underlined by the need to contain expenditure. Going by what he called eating what we would have killed, economic commentators say the 2011 budget presentation needs to target sectors with potential to support economic growth. With elections also expected to be held next year already requiring US$200 million, Minister Biti would have to dig deep in his bag of tricks to come up with a policy that stimulates economic confidence.
Various economic stakeholders will be watching with interest to see how resources will be shared across the board. The 2010 fiscal policy had projected the economy to register an 8,1 per cent growth on the back of an improved agricultural season which was expected to register an 18,8 per cent growth. The prevailing stability was expected to push economic growth figures into the two-digit figures by 2011. An economic analyst with CZI said the envisaged figures were now under threat if the country goes ahead with elections. The International Monetary Fund has also revised upwards growth projections for this economy to 5,9 per cent from 2,2 per cent citing export recovery, increased remittances from the Diaspora and higher demand for minerals from Asia as the main anchors for growth. The IMF delegation which was in the country submitted to the Finance Minsiter a draft budget document which it says needs to analyzed fully to prevent budget overruns.
Post published in: Economy