Thursday, April 19, 2018

Cash shortages Mnangagwa's archilles heel

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Fidelis Munyoro Chief Court Reporter
President Mnangagwa has reaffirmed the country’s economy is forecast to grow by 4,5 percent this year on the back of a robust performance in agriculture, mining, tourism and the construction sector. He said his administration was alive to the pain caused by cash shortages at banks which he pledged would be tackled with vigour and urgency, but cautioned the crisis could not be resolved overnight.
In his 2018 National Budget Statement, Finance and Economic Development Minister Patrick Chinamasa forecast the country’s economic growth rate at 4,5 percent.
The President attributed the bullish economic sentiment partly to investor-friendly reforms being pursued under the new dispensation.
He spoke of a brighter future of prosperity if Zimbabweans remain united and preserve peace.
“One of the most evident changes in the past few months has been the renewed spirit of unity, optimism and determination among our people,” said President Mnangagwa yesterday in his address to a packed National Sports Stadium to mark Zimbabwe’s 38th Independence anniversary celebrations.
“Once again we are free to dream, to hope and to believe. This new spirit has spread outside our borders and we are hugely encouraged by the goodwill our country continues to receive from around the world. This renewed domestic and foreign investor confidence has seen our projected economic growth increase from 3,7 percent last year to 4,5 percent in 2018.”
President Mnangagwa said for the country to sustain the current growth trajectory, Zimbabweans must think big.
“Let us believe that our tomorrow is greater. Let us boldly and proudly sing our national anthem and fly our flag high in renewed hope and unity. Let us think big of our country,” said President Mnangagwa, quoting a biblical verse, which says, “As a man thinks in his heart, so he is”.
“Let us also speak and confess well and the very best over our country, for the Bible again says, ‘death and life are in the power of the tongue and they that love it shall eat the fruit thereof’.”
President Mnangagwa, who was delivering his maiden Independence Day speech since his inauguration in November last year, said Government had adopted a number of initiatives over the past five months to grow the economy.
His new administration, he said, was built on the success of last year’s Command Agriculture that led to an improved harvest and is determined to ensure continued food self-sufficiency, increased land usage and productivity through mechanisation and modernisation of the sector.
President Mnangagwa said the Government had injected $10 million into beef cattle breeding under the Command Agriculture which now includes cropping, livestock, fisheries and wildlife.
“In agriculture, as in all fields, we are strongest when we work together,” he said.
“We therefore applaud the private sector which has partnered my Government in delivering these initiatives in response to our call for a united and collective approach to national economic rebuilding.”
Government’s ongoing efforts, the President said, would not only rejuvenate agro-value chain industries, but would also help improve the livelihood and incomers of the rural communities while contributing to the achievement of economic growth targets.
Turning to mining, President Mnangagwa said the sector continued to be one of the leading sources of investment and export earnings, with a huge impact on employment opportunities and the economy.
“To stimulate growth and send a clear message of the new Government, which has a new way of doing things, we have amended the indigenisation and empowerment policy, limiting the 51:49 investment ratios to diamond and platinum mining only,” he said.
“As a result we have opened up vast areas of our economy to international investment.”
President Mnagagwa also assured the nation that the Government was speeding up implementation of measures to resolve the shortage of cash in the economy.
Among the measures being taken to ease the cash crisis are the mobilisation of foreign finance from regional and international institutions, increasing foreign currency importation, opening up the economy to investment and increasing exports.
“We are well aware of the great hardships caused by the lack of availability of cash,” said President Mnangagwa.
“This is a painful and poignant issue for so many individuals and families across the country and a problem we are working tirelessly to solve.”
The President said the cash crisis would not be resolved overnight. He said their job as leaders was to honestly recognise the scale of the problems facing the nation and to create concrete plans to solve them.
He urged the financial services sector to create robust financial packages responsive to the new Zimbabwean economy. He reiterated his investment pitch that Zimbabwe was open for business.
“To this end, my Government will continue to implement legal, institutional and administrative reforms to increase the ease of doing business in Zimbabwe.”
President Mnangagwa also said efforts were being made to rationalise investment procedures through the setting up of a one-stop-investment centre.
He said a national investment policy was now in place while an investment and business facilitation bill to give legal underpinning to Zimbabwe’s commitment to open up its economy was undergoing due legal process.