Government has been urged to present the 2024 budget in United States dollars after Finance minister Mthuli Ncube projected a deficit of ZWL$2,3 trillion for next year.
Ncube made the projection in his 2024 budget strategy paper titled: Consolidating Economic Transformation published on the ministry’s website recently.
“The projected revenue for the year 2024 is (ZWL)$30,7 trillion against expenditures of (ZWL)$33,1 trillion, resulting in a budget deficit of (ZWL)$2,3 trillion (1,5% of gross domestic product (GDP),” he said in the paper dated August 11.
“Employment costs will be maintained at levels of below 50% of revenue, while capital expenditures will gradually increase to 5,7% of GDP in order to address the existing infrastructure gap.
“Re-establishing macro-economic stability and the creation of an enabling business environment will be crucial in building resilience of the economy to domestic and external shocks, as well as facilitating private sector-led economic recovery and growth.”
Coalition for Market and Liberal Solutions executive director, Rejoice Ngwenya said government must do away with the local currency in the 2024 budget.
“The Zimbabwe dollar is subject to massive inflationary forces, so one can’t predict beyond one year,” Ngwenya said.
“Our economy must be geared towards multi-billion-dollar configuration, not this worthless paper.”
President Emmerson Mnangagwa reintroduced the local currency in 2019 after a decade of dolllarisation.
Mnangagwa has resisted calls to redollarise after the local currency lost significant value, leaving many workers demanding salaries in United States dollars.
Economist Gift Mugano questioned Ncube’s 2024 budget projections.
“In view of the fact that Treasury spent ZWL$747,5 billion in the first half of the year, what is the justification that it will spend ZWL$4,2 trillion in the last half of the year?,” Mugano asked.
“In view of the fact that Treasury anticipates to exceed its current budget by five times in 2023, what is the rationale of Ncube predicting to spend ZWL$33 trillion in 2024, that is, ZWL$8 trillion more than the current budget of ZWL$25,6 trillion?”
National Consumer Rights Association spokesperson, Effie Ncube said consumers were suffering because of the country’s bad politics.
“The economy won’t go anywhere, and no budget can rescue it unless and until the country changes the way it does politics and reduces political risk factors,” Ncube said
“Our political environment is noisy, messy, repulsive and not pro-economic development and our bad international relations are driving investors away.”