Chinamasa told a pre-budget summit, which ended at the weekend in Victoria Falls, that there will be no budget statement in November as was widely expected.
The national budget will now be presented “possibly in December” or in time for the constitutional deadline of January, to allow the Minister more time to consult.
But Harare-based economist Vince Musewe says the country is facing a crisis, and no amount of consultation will generate revenue where there is none.
Speaking to SW Radio Africa Tuesday, Musewe said: “Many companies are closing down for lack of disposable income, and this means that the revenue base for the government is dwindling as they can’t collect taxes from employees or firms.
“Any budget must first determine the revenue base that it gets. Until you can resolve revenue issues, there is little point in presenting these budgets.”
Musewe said one option out of the current scenario is through borrowing, but added that this will be a tough call for the country given its terrible credit record.
“We even have a Treasury that raids private accounts and refuses to pay and this fans a genuine lack of confidence and uncertainty in the system. It is not surprising that no-one is putting money in the system and the sooner government realises that we are in a crisis and starts addressing this the better,” Musewe said.
The first option is to implement democratic reforms and then go cap in hand to the West to request emergency relief, the economist said.
Given the country’s poor credit history, very few lenders will be willing to lend, as has already been demonstrated recently when even regional countries declined Zimbabwe’s request for money to fund its polls.
Last month, Chinamasa was in Washington where he tried and failed to negotiate financial support and a write-off of the country’s estimated $11 billion debt owed to multilateral lenders.
The second option Musewe said, is to raise revenue from the country’s vast resources, but this calls for transparency, accountability and sound economic policies, which the current administration has been unwilling to subscribe to.
“We can talk about the country’s mineral wealth which should be funding the budget, but the opaque deals which ZANU PF signed during the coalition government were never meant to benefit the country but were aimed at enriching a few individuals and groups within that party.”
The Chinese, ZANU PF elites and the country’s military control the country’s murky diamond sector, as revealed by international rights group, Global Witness.
The country sits on one of the world’s largest diamond deposits and the world’s second largest platinum reserves, in addition to an array of other mineral riches.
Last year diamond revenue from Marange was expected to be in the region of $600 million, but despite government owning a 50% stake, nothing had been remitted to Treasury by June this year.
Last month, the ZANU PF government launched another of its many economic blueprints ostensibly aimed at providing “a new trajectory of accelerated economic growth and wealth creation.”
Musewe dismissed this as pie-in-the-sky: “We must begin to implement genuine reforms and move the country towards a democratic environment. Without that, we can talk and have economic blueprints but the reality is that people are starving and need food.
“We are facing a self-manufactured crisis and Mugabe’s government needs to shun past mistakes and take full responsibility for what it has created. The country needs friends and if indeed China is a friend, why aren’t they giving us financial support?
“Now that the elections are over, people are going to realise that ZANU PF will not be able to rig the economy to fulfil its election promises of hiking wages, providing, water, electricity, as Morgan Tsvangirai warned.”
Musewe’s observations come at a time when health institutions are facing major challenges such as dilapidated infrastructure and a lack of medical supplies. Health Minister David Parirenyatwa last week pleaded with the private sector to step in and adopt wards for renovation, in a bid to resuscitate the ailing institutions. – SW Radio Africa
Post published in: News
Vince Musewe you are now happy….advocate now the Arab spring,you sell-out………..you still campagning for more illegal sanctions against your country-men you stupid…….ubuthuvi wena Vince,you are now taking over from Morgan Tsvangirai to push for his regime change stance…zwimngwa sungata….Zimbabwe will never be a colony again…..the Zimbabwean government will see what to do,do not predict the outcome….its an going strategy…..please wait,wait, do not rush iwe Vince Musewe…………..
Silungisani ndhlovu you seem to want to decorate a pig and call it a nice woman. You want to smear shit on people and call it perfume handiti? Some of these facts are very factual and where is the budget if you Silungisani can tell us. That is why you even use a borrowed name. Your comments anywhere on any fora are just what they are raw sewerage.
That ndevele person is the most dangerous person. He does not know what is on the ground except the lies they are being fed by these dictators.
Ndiwe chimbwasungata iwewe. Hauna kurwa hondo iwe. Zimbabwe is very rich in terms of minerals, man power etc but people are starving. You hide behind sanctions. Why did chinamasa go there to borrow money if there are sanction? If l say l dont want to see you in my house can we call that sanctions? Dont be brain washed
Zanu PF constantly shouts that ‘Zimbabwe will never be a colony again’ but please tell me why are the signs at immigration control in Harare airport in two languages – English and …. Chinese?