Zimbabwe’s economic resilience impresses Treasury

Story by Stanley James, Business Editor

ZIMBABWE’S Treasury has been impressed by the resilience of the economy with inflation and exchange rate stability being the main focus for growth during the second half of the year.

Despite shocks that characterised the economy during the first six months of this year, the recent fiscal and monetary authority interventions have created a platform for certainty and growth.

In an exclusive interview with the ZBC News this week, the Permanent Secretary in the Ministry of Finance and Economic Development, Mr George Guvamatanga revealed a commitment to consolidate current gains.

“I think the beauty about this economy is that it is a self-sustaining economy. We have built our roads, airports, technical power stations, dams, and infrastructure facilities using our resources. Such indicators all point to a strong economy that has that element of limited dependency. Such elements set the tone for a strong economy that can boost productive sectors, social nets and other elements,” he said.

Measures to promote the use and demand of the Zimbabwe dollar are also expected to anchor business confidence and socio-economic growth.

He added, “There has been a massive increase in the demand for the local currency and use of the Zimbabwe Dollar and at the moment, several companies are in the hunt for the local currency. There are some firms who have even requested to pay their taxes in the United States dollar, but we have said no, we want the payment of tax in the local currency.

“As a government, we are confident that we shall see an increase in the use of the local currency. Remember, there is no economy that can successfully operate without its currency.”

Despite challenges, the Treasury has committed to pay suppliers and contractors provided they comply with the value for money process requirements by not inflating charges.

“The Government makes up over 75 per cent of the economy in terms of business transactions with suppliers and contractors, so, if it stops paying contractors and suppliers that will result in a serious deadlock in the economy. So, payments to our contractors and suppliers do not have any inflation impact because the money is coming from domestic resources mainly taxes,” he explained.

“There is also that notion that we have stopped paying contractors or suppliers, no, that’s not true. We are paying them provided they invoice us in line with the value for money process that entails or avoid forward pricing practices,” he reiterated.

Zimbabwe’s economy has in the past three years registered a positive growth rate with multilateral financiers such as the World Bank, the International Monetary Fund, African Development Bank, among others, endorsing the positive annual growth figures.

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