Funding a major headache for Zim Asset | The Herald

via Funding a major headache for Zim Asset | The Herald November 11, 2013

GOVERNMENT has demonstrated a desire to transform the economy through crafting of the Zimbabwe Agenda for Sustainable Socio-Economic Transformation, but the blueprint may fall short of targets due to inadequate funding.

Zim Asset is the Government’s new macro-economic policy that will guide economic development programmes over the next five years until December 2018.

The blueprint, which borrows from the ruling party Zanu-PF’s election manifesto and previous national development programmes, identifies four, but all-encompassing clusters, namely food security and nutrition, social services and poverty reduction, infrastructure and utilities and value addition and beneficiation.

Analysts say Government should establish a regulatory framework that allows for securitisation of minerals, mortgages and other assets to raise long-term finance.

Under the food and nutrition cluster, the policy document spells out what needs to be done.

The success of this critical cluster depends on the fiscal space. The cluster proposes implementation of a Comprehensive Africa Agricultural Development Programme mooted by the Africa Union.

The Common Market for Eastern and Southern Africa is implanting the initiative whose objective inter alia is to compel governments to allocate at least 10 percent of their National Budget to agriculture.

Analysts say if implemented in line with CAADP recommendations, using the assumption that the 2014 National Budget would be US$4,4 billion, and under the current circumstances without external funding, it follows that the agricultural sector will receive US$440 million, 25 percent of its annual requirement.

For everything to follow, a sound budget which can stimulate the economy is needed.

This can be achieved if Government leveraged the mineral resources to secure lines of credit. Analysts noted Zimbabwe cannot adequately raise money from taxes or foreign direct investment, especially in the medium term considering FDIs have not yielded desired results in other African countries, particularly South Africa.

On the empowerment cluster, the drive spelt in the policy is what has been conventional, which was implemented many years ago although the country witnessed a massive drive of empowerment from the land reform through to the indigenisation era.

Observers have, however, noted that while Government has tried to bring empowerment to the majority, the majority of people have not really smelt the real wealth.

Empowerment in most cases has remained abstract for the reason that there is a missing link between empowerment programmes and certain catalysts which are necessary to make it work. This catalyst is silent in the Zim Asset document.

The missing link is the absence of local content or procurement rules. Taking agriculture, for example, Pick n’ Pay is buying tomatoes from South Africa when the country has capable farmers who can be contracted to produce on the supermarket chain’s behalf.

In the same vein, by legislating local content, the fiscal authorities will be relieved of pressure as the move towards this improves circulation of money and halts externalisation of money which is rampant in the retail and mining sector.

The local content approach should also apply to investment deals with friendly nations. Another important cluster of the Zim Asset is infrastructure development. This cluster is mooting public private partnerships arrangements. One of the problems of PPPs is that there are a number of legal issues which need to be addressed.

For example, the electricity pricing is regulated by Zimbabwe Electricity Regulatory Authority. Zimbabwe has always called for PPPs over the years in the electricity sector but concerns which have been raised by investors centred on the pricing of power which was deemed too low to guarantee an ideal return on investments.

These concerns need to be revisited and verified and if possible corrected if the country is to use PPPs in the energy sector as enunciated in the Zim Asset.

 

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12 comments on “Funding a major headache for Zim Asset | The Herald
  1. It’s already in the dustbin

  2. Zindoga says:

    Dont steal elections for the sake of power knowing well that u cant deal wth the economy.these people are cruel worse than Satan.

  3. Joe says:

    How many do called 5 year plans have there been. This is just another pie in the sky. This bunch of goons are unbelievable. Nothing that comes out of their mouth has any tangible sense of progress. It’s either begging stealing or destroying. Nothing else. Pathetic just pathetic

    • Mark says:

      Exactly Joe this is the “african communist” way of giving the people “hope” year after year until they are voted out or violently removed by some or other force and then the next group of thieving sods of hell start all over again with their own macro-economic policy or blueprint.Every single one negotiates a deal to keep their ill gotten gains and retire comfortably until death.It will never stop , they have hoodwinked the west with their blaming of racism and colonization and the new one “sanctions” for their failures.The one unbelievable situation is that africans will believe this rubbish for 34 years.!!!!!!!!!!!

      • DRY WINE says:

        Even their all weather friend China whispers that they will never allow these morons anywhere close to their cash. China has reserves of over 100 Trillion USD. They have impressive infrastructure, bullet trains, Maglev trains, best economy in the world under pinned by wealth creation through tech productivity.

        They will never fund a ZPF Govt. This they say quiescilingly. Give them just enough to allow the Asians to pillage the economy. And they are doing it with verve. They are putting holes in every village, silting the rivers, selling retail anything they can…and never banking the cash here or paying tax. Taking the loot home….ha ha ha ZPF is manyoka chaiwo

  4. DL says:

    Lots of big words and ideas thrown about to impress, but there’s nothing behind it. It’s not a question of failure – they’re not even going to make an effort! This is all smoke and mirrors.

  5. Hisexcellency says:

    So many empty,meaningless words of rubbish.

  6. Shebah says:

    If funding was going to be easy to get why would we want to work. Funding is a challenge and Chinamasa has to face and meet the challenge. Already the Chinese have given him 319 million for electricity generation capacity development, reducing the hurdles.

  7. Hisexcellency says:

    While many maintain that Mugabe loyalists remain the main beneficiaries of the bloody land reform (the Mugabe family is now said to own more than 30 farms), some have suggested that it was not all bad. For example, though it says the methods used were inexcusable, a book entitled Zimbabwe Takes Back its Land by Professor Ian Scoones of Sussex University concluded: “In the biggest land reform in Africa, 6,000 white farmers have been replaced by 245,000 Zimbabwean farmers. These are primarily ordinary poor people who have become more productive farmers.”

    “We tackled the enemy head on and we got the land,” Agriculture Minister Joseph Made said in an interview. “They will never, never accept that there are now new owners on the land who have done wonders.”

    During the turbulence of the farm takeovers, tobacco production plunged to 48.3 million kilograms in 2008 from a record 236.7 million kilograms in 2000, according to the Zimbabwe Tobacco Association. Now it’s making a comeback, with this year’s 166.7 million kilograms earning about $612m.

  8. Johnson@yahoo.com says:

    We need all the factors in the equation. Unoda oxen dzei usina gejo. Put all aspects there. There have been better plans…but implementation is the problem especially if macro economic factors are not jelling!! Surely you know what to do you ZANU PF guys, but you are too obsessed with utopia ideas such as mass empowerment!! What ideology is that? An experiment? Guys just be brave and admit indiginization yaramba moita zvamaiti hazviiti zvacho! izvozvo ndizvo zvinoita patiri pano manje tomboitawo mabasa then tozo indeginiza later after 2018. Hope Nikuv is still availbale so why worry. FDI guys is the solution. Just do it.

  9. Mr Mixed Race says:

    We have to refurbish our railway network,Zesa power stations and water systems to ensure that any investor has at least 23 hours of electricity and water.An investor wants a reliable transport network for transportation.At the moment companies run at a loss because their production lines are badly affected by power cuts and water.I saw it happening to a company which makes plastic storage tanks,when power was cut during the process of making a 5000 litres tank.This company had to throw away the resin which had already started the process of manufacturing.No foreign company would accept this type of loss with impunity to ZESA. The current laws protect Zesa against lawsuits against losses caused by power failure.As I have said it on other topics related to economy that its easy to destroy but very hard to rebuild.Our leaders have really let us down.A few days ago I read something which suggested that those who want to reopen ZISCO in KWEKWE, they want a designated railway line to Hwange coalfields to guarantee coal supplies. Do we have that capacity to run parallel networks,when our people are starving to death? These are the results of high corruption.

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