The Sunday Mail
Government has recorded several achievements in its economic reform agenda including a budget surplus of $443 million in the first three months of the year, as authorities continue to enforce the economic fundamentals necessary for sustainable growth.
According to the latest treasury bulletin availed to The Sunday Mail, other notable achievements include cutting the domestic debt, jettisoning issuance of treasury bills, privatisation of State entities and accelerating the ease of doing business among other positives.
These gains are expected to position the economy on the trajectory for growth, despite current challenges that are a result of a drastic shift from the old way of doing things.
President Emmerson Mnangagwa last week pronounced that while the economic reform process had brought with it some shocks, the country was now on the cusp of glory; “as the darkest hour comes before dawn”.
The treasury bulletin noted that Government far exceeded its target of $78 million to record $443 million surplus in the first quarter.
“The budget balance for the period January to March was a surplus of $443,1 million, against a target of $78.2 million, indicating a major shift in the management of central Government finances from deficits to surpluses,” read part of the bulletin.
“Containing the budget deficit to sustainable levels, which will also provide scope for managing the debt and inflation outcomes. Since January 2019, the Government has been running budget surpluses at $102, 4 million in January, $85, 4 million in February and $255, 3 million in March.”
When President Emmerson Mnangagwa’s administration took office, it was burdened with paying off treasury bills from the previous administration.
Since January, Treasury has not issued any Bills as it conforms to prudent practices in managing the economy.
“As a result, since January 2019, neither Treasury Bills nor the overdraft facility were utilised to finance the budget,” the bulletin further states.
“The Treasury Bill issuances amounting to $180 million were for purposes of restructuring previous years’ maturing debt.
“Treasury Bill issuances related to ZAMCO operations have also been frozen, as announced in the 2019 Budget Statement.”
Zimbabwe’s external and domestic debts stood at US$7,7 billion and US$9, 6 billion respectively and Government is adopting a two pronged approach that involves reengaging with international creditors while containing the local obligations.
The bulletin shows that in the first quarter of the year, “payments amounting to $319 million were expended towards relinquishing maturing domestic debt.”
A 64,1 percent increase was also recorded in revenue collection in comparison to the same period in 2018 after the Zimbabwe Revenue Authority (ZIMRA) improved its capacities and also plugged talk loopholes.
The report noted that the Intermediated Money Transfer Tax (IMTT), which was introduced amid public outcry last year, has yielded positive results after it generated monthly average revenue of $95 million against a target of $50 million.
While inflation has continued to be a thorn in the flesh, since the start of the year, authorities expect the rate to go down during the latter part of this year.
Between January and March, Government was able to contain expenditure to $1,5 billion, against planned spending of $1,7 billion.
The report said major expenditures were on employment costs at $1 billion, operations and maintenance $185,6 million, interest $93,3 million and capital projects $175 million.
In support of social service delivery, $62.5 million was disbursed towards education, health as well as other social protection programmes.
Speaking after witnessing the signing ceremony of an investment agreement for a platinum concession between Government and Bravura Consortium on Friday, President Mnangagwa said Zimbabwe’s economic prosperity was within touching distance.
“I believe those who have the perception know that that darkest hour for Zimbabwe is before dawn.
“Dawn is just a few kilometres away. Prosperity for this country is there. All what we need is unity and peace among our people. We must march forward together.”
He further warned that those who did not have faith in the impending economic boom will “fall by the wayside.”