Chinamasa ‘sweats’ ahead of mid-term policy statement: will he talk about bond notes?

Finance and Economic Development Minister Patrick Chinamasa will present his mid-term fiscal policy review statement this week amid calls to free up fiscal space through a combination of bold policy decisions and major reforms. The policy statement, delayed due to a number of factors including the unavailability of the minister and other Government commitments, is probably one of the most difficult pronouncements given the limited room Minister Chinamasa faces. Faced by a challenging liquidity situation, dwindling Government revenues due to a shrinking revenue base against a high civil service wages bill, the Finance and Economic Development Minister announces a statement which economists believe should be based on bold policy decisions which Government should take. It is expected, however, that top of Minister Chinamasa’s agenda will be agriculture, based on the new $500 million Command Agriculture initiative launched by Government recently. The Command Agriculture initiative seeks to achieve self-sufficiency in the provision of food for the next three to four years with 400 000 hectares throughout the country dedicated to grain production for a yield of at least two million tonnes of grain per season. In that regard, Minister Chinamasa is expected to comment on how Government intends to fund the initiative. The minister is also expected to touch on how far Government has progressed with the civil service and parastatal reforms and on strengthening public finance management. These measures are believed to have a huge role to play in freeing up fiscal space and more importantly refocus Government expenditure patterns. With Minister Chinamasa unlikely to come up with a supplementary budget in light of tight fiscal space, Zimbabweans are expecting none other than a review statement that stimulates confidence. He is also expected to provide an update on the debt clearance strategy as part of the re-engagement with the international community.

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