Govt moves to revive economy

Source: Govt moves to revive economy | The Herald October 7, 2016

Lloyd Gumbo Senior Reporter—
President Mugabe says Government is implementing a number of initiatives to improve the country’s economic fortunes on the back of biting challenges faced in various sectors.

Speaking as he officially opened the Fourth Session of the Eighth Parliament in Harare yesterday, President Mugabe said: “Our economy faces a number of challenges, which include the subdued aggregate demand, liquidity constraints, high interest rates, subdued foreign direct investment and limited fiscal space.”

“This, too, is further compounded by low revenue collections arising from depressed production, rampant revenue leakages, as well as poor mineral commodity prices on the global market. “As a consequence, the economy registered a gradual decline, with the estimated growth rate for 2016 now projected at 1,2 percent.”

But President Mugabe said in the context of Zim-Asset, Government was implementing a number of initiatives to address the prevailing economic challenges. “For instance, it has embarked on the Ease of Doing Business Reforms with the objective of improving the local business environment that stimulates investment inflows.

“In line with this thrust, a new Companies Act, which will significantly reduce registration delays and facilitate the smooth operation of new businesses, will be tabled for consideration by Parliament,” said the President.

President Mugabe said it was pleasing that gold deliveries to Fidelity Printers and Refineries were increasing. He said a jewellery manufacturing company owned by the Central Bank, Aurex was now on the recovery path.

“Even though mining remains a leading source of export earnings for our economy, there is still need to maximise the sector’s earnings through encouraging local value-addition and beneficiation as well as the effective exploitation of mineral claims,” he said.

President Mugabe said Government was also committed to boost power generation in the energy sector as he expressed his satisfaction with the progress at the Kariba South Power expansion project that was now 60 percent complete.

The project will add 300 megawatts to the national grid by March 2018 with the first 150MW expected to be ready by December next year. He said that agreement on the funding of the Hwange Thermal Power Station expansion project was expected before year end, which would pave way for the commencement of actual work in the first quarter of next year.

“For this reason, Government has come up with Dema Diesel Power generating Plant. Work is also underway to establish a natural gas powered electricity generating plant and three 100MW solar power generating plants.

“The ministry is in the process of crafting for presentation to Parliament, the Renewable Energy Policy and an Independent Power Producers (IPPs) Framework, which should help to enhance private sector investment in the energy sector,” said President Mugabe.

He said the country still faced numerous challenges in the manufacturing sector, a challenge that militated against Zimbabwe’s capacity to compete in the regional and global market place.

Some of the challenges included, the dumping of cheap imports in the country, reliance on obsolete equipment, high cost of utilities and lack of access to cheaper lines of credit.

In the transport sector, President Mugabe said the rehabilitation of the Beitbridge-Harare-Chirundu highway was expected to commence soon, a development that would make Zimbabwe, the region’s transport hub.

He implored Parliament to expedite the necessary loan approvals and ratification processes to bring the project to fruition. President Mugabe said reform of the state enterprises remained a critical lever in the country’s economic turnaround process.

“I note, with satisfaction, that ARDA is now on a firm recovery path, thanks to its joint venture partnership with some local private sector players. “Government recently approved a turnaround plan for the Cold Storage Company, as part of the programme to revive the country’s beef industry,” he said.

The President added that Government would also launch the 2016-2026 Science, Technology, Engineering and Mathematics (STEM) Policy Strategy to support the country’s quest for industrialisation and modernisation within the framework of the African Union Agenda 2063.

President Mugabe said Government was also committed to the provision of a conducive working environment for the legislature, in spite of the prevailing resource constraints. He said construction of the new Parliament building through a Chinese grant in Mt Hampden was now under implementation.