The Movement for Democratic Change (MDC) formation led by former Prime Minister Morgan Tsvangirai is calling for a stimulus package to boost the country’s faltering economy.
Saddled with a debt overhang of more than $8 billion, the MDC-T says the country can only move forward if new money is injected into the economy.
The MDC-T’s economic affairs secretary, Webber Chinyadza, told a news conference at his party’s Harvest House headquarters in the capital today that Zimbabwe’s national economic output has not surpassed a high recorded in 1972 before the country attained its independence, a situation he blamed on President Robert Mugabe’s poor governing policies.
Chinyadza said the ruling Zanu PF government has failed to come up with sound economic policies, adding that Zimbabwe now needs a stimulus package to revitalize its productive sectors of the economy that are operating far beyond capacity.
Noting that the country’s economy is agro-based, the opposition official says it is disheartening that authorities allocated a paltry sum of money to the agricultural sector in this year’s cropping season budget to finance irrigation schemes at a time when rainfall patterns have change due to climate change.
Studio 7 failed to get a comment from Zanu PF spokesperson Simon Khaya Moyo who said he was attending the official opening of the Harare Agricultural Show where Mozambican President Filipe Nyusi was officiating.
However, President Robert Mugabe told Zimbabweans in his State of the Nation address that Zimbabwe’s economy was poised for a major take-off in keeping with the country’s economic blueprint, ZimAsset, promising that his government was going to prioritize value addition on agricultural products and enacting policies that promote and attract foreign direct investment.
Former government chief economist, Masimba Manyanya, says more needs to be done before Zimbabwe gets a stimulus package.
Meanwhile, finance minister Patrick Chinamasa yesterday pleaded for a cash bailout from the World Bank saying Zimbabwe has not received a single cent from the Bretton Woods institution in the last 10 years.
But Guang Zhen Chen, the World Bank’s country director for seven southern African countries including Zimbabwe, told Chinamasa that the Zimbabwean government needed to demonstrate that it is serious in addressing the macro-economic and investment challenges that the country is facing.
Some foreign investors are reportedly shunning Zimbabwe because they are not happy with the black empowerment regulations that compel all foreign-owned businesses to cede at least 51 percent of their shareholding to black Zimbabweans.
Manyanya says government also needs to ensure that investors’ money is safe in Zimbabwe.
Zimbabwe's external debt overhang is hovering at $8.4 billion and the country has failed to clear its arrears in order to access fresh lines of credit to service its economy.