Industry and Commerce Minister Mike Bimha (left), Confederation of Zimbabwe Industries president Mr Charles Msipa (centre) and CZI chief economist Ms Lorraine Chikanya follow proceedings during the CZI Zim-Asset workshop.
Kudakwashe Pembere Business Reporter—
ZIMBABWE requires at least US$27 billion to fund the Zimbabwe Agenda for Sustainable Socio-Economic Transformation (Zim-Asset), with the bulk of the money earmarked for infrastructure projects, a senior Government official said yesterday.Speaking at the Confederation of Zimbabwe Industry Zim-Asset workshop in Harare, acting director for Fiscal Policy and Advisory Services in the Finance and Economic Development Ministry Mr Jonah Mushayi said the Government was looking at mobilising the money from the Diaspora, mortgaging of minerals and long term credit. The Government would also pursue joint ventures and public private partnerships.
“The quantum of the resources needed for the implementation of the Zim-Asset are estimated at US$27 billion,” said Mr Mushayi.
“This is quite a huge figure but over the planned period, by 2018 we hope to raise the money. The bulk of it has been earmarked for water and sanitation, transport, energy, ICT housing and social services.
“We have identified sources of funding which are harnessing Diaspora resources, domestic resource mobilisation, accessing external financing and the issue of debt relief.
“In terms of resource mobilisation we are aware that on December 19, last year the Ministry of Finance unveiled a US$4,1 billion budget broken down as follows, 73 percent on employment costs, non employment costs with and recurrent expenditures at 15 percent . . . while 12 percent on capital (projects). From this we have limitations.”
“We have provided financing for some of the projects in the 2014 Budget and with the 12 percent, we cannot do much so we will continue to pursue the issue of joint ventures as our second option of financing, which can achieve greater mileage.”
Zim-Asset is the Government’s policy framework covering period between 2014 and 2018.
The policy, which targets annual average growth of 7 percent, seeks to spearhead the turnaround and development of the economy in the next five years.
This will be largely driven by strong performance in mining, agriculture and the manufacturing sectors. Mr Mushayi added that the Government would explore the possibility of financial assistance through bilateral agreements with countries in the region.
He said there would also be consideration of tapping into the US$29,1 billion fund set aside for the Caribbean and Pacific countries under the 11th European Development Fund as well as the US$110 billion Islamic Bonds.
“We need to come up with bankable projects and to prioritise servicing loans to unlock more financing,” he added.
Under the Zim-Asset, the Government will prioritise four main clusters namely food security and nutrition, poverty reduction, infrastructure and utilities and value addition and beneficiation to empower the majority.
The blueprint borrows from the ruling Zanu-PF’s election manifesto and previous national development programmes. However, economists have warned that while the Zim-Asset was a good policy, it may fail due to funding challenges.