Finance Minister to present 2021 budget review today
Finance and Economic Development Minister Professor Mthuli Ncube will this afternoon present the midterm review statement on the performance of the 2021 National Budget for the period January to June 2021.
Information, Publicity and Broadcasting Services Minister Monica Mutsvangwa, told the 24th post-Cabinet briefing on Tuesday that Minister Ncube also used the occasion to present the 2022 budget strategy paper.
“Cabinet advises the nation that the details of the 2021 Mid-Year Fiscal Policy will be in the statement that the Minister will present to Parliament today,” Minister Mutsvangwa said.
Minister Ncube last year presented a $421 billion national budget statement, premised on the assumption that the cumulative revenue collections for the 12 months to December 2021 would total $390,8 billion.
Overall, the finance and economic development minister predicted a national budget balance of minus $30,8 billion while the current account was expected to close the current financial year at $73,8 billion.
The treasury chief projected that the economy would grow by 7,4 percent, after a straight two-year downturn, largely driven by agriculture and mining, while inflation was forecast to end the year at 9 percent.
The strong projected growth this year was also backed by the International Monetary Fund (IMF), which foresees a 6 percent expansion and the World Bank, which predicted a conservative 3,9 percent growth.
A majority of Zimbabwe’s economic sectors are expected to register significant growth, after a strong agriculture season and expected commodity price boom, amid growing stability.
The economy has been characterised by improved macroeconomic and exchange rate stability, following the introduction of the auction system, tight fiscal and monetary policies.
This has reflected a sustained decline in the rate of inflation, which peaked at a post dollarisation high of 837,6 percent in 2020, but fell to a new low of 106,6 percent last month.
It was expected that the public dent would end this year perched at $1,9 trillion.
She also said the Cabinet adopted the 2021 mid-year fiscal policy and economic review and balance of payment developments, state of the financial sector and outlook, presented by Minister Ncube.
Minister Mutsvangwa said the National Budget strategy paper for 2022, presented to Cabinet by Minister Ncube was approved by Cabinet.
“The 2022 Budget Strategy Paper is part of the annual budget preparatory process issued in order for stakeholders to understand macro-fiscal issues that will guide prioritisation of budget allocations,” she said.
In terms of the strategy paper, the Zimbabwean economy is projected to grow by 5,4 percent in 2022, anchored on growth in mining, manufacturing and electricity generation, among others.
Government revenue is expected to improve from 16,4 percent ($390,8 billion) of the Gross Domestic Product (GDP) in 2021 to 17,8 percent ($533,2 billion) in the coming year.
On the other hand, expenditure is anticipated to increase to 19,4 percent ($579,1 billion) of total national economic output next year from the 18,2 percent ($421,6 billion) in 2021.
In the 2022 budget, the Government will prioritise sustaining macroeconomic stability, for conducive business and investment conditions and to improve the living standards of citizens.
Priority areas in 2022 will include inclusive growth and macro-economic stability, developing and supporting productive value chains, optimising value in natural resources, infrastructure, ICTs and digital economy.