Economic Mismanagement Under New Dispensation Hardly Inspires Confidence – Tony Hawkins

advertisement

 

Economist and academic, Tony Hawkins has said that President Emmerson Mnangagwa’s record of managing the economy since coming into power last November does not inspire confidence. Hawkins highlighted that the government was living well outside of its means and relying on printing money through the RTGS system. Writes Hawkins,

The record of macroeconomic mismanagement, including under the New Dispensation since the military coup last November, is stark. Domestic debt has escalated alarmingly; the balance-of-payments gap is widening; more and more is being borrowed offshore by private as well as official entities

In the 2018 budget presented nine months ago, the former finance minister, Patrick Chinamasa, promised to cut the budget deficit from $2.5 billion, which was hugely understated at the time to $671 million this year.

But just before he left office after losing his seat in the July 31 election, Chinamasa’s ministry revealed that government spending, far from being cut, had jumped 57% in the first half of the year. The deficit for the 6 months was $1.4 billion and forecasters expect it to top 3 billion – more than 16% of GDP – in 2018, especially when the extra $300 million for the 17.5% pay rise for civil servants and the 20% hike for the military and police, is taken into account.

Such profligacy hardly inspires confidence in the fiscal consolidation promised by the president and his new cabinet.

More: Source

WhatsApp Discussions

Click to subscribe to a Pindula WhatsApp Group:
https://chat.whatsapp.com/JaZ0lyL42OYIuRCCf6j4B4

If you find the group full, please notify us on +263 777 707 852 and we'll update the link.

Daily Email Brief

Get the top news delivered to your inbox every day.

Leave a Reply

Your email address will not be published.