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This week: 2017 budget should outline key trategies for economic recovery

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By Kelvin Esiasa

This week the Minister of Finance Honourable Felix Mutati will present the National Budget for the year 2017.

This is the first time the National Budget will be presented under a new Republican constitution. It will also be the first time Honourable Felix Mutati would be presenting the national budget to parliament.

Last year, the Minister of Finance Alexander B. Chikwanda did acknowledge the economic challenges that Zambia had faced and told parliament that the year 2015 had been economically challenging. The slowdown in the Eurozone and Chinese economy, and low copper prices were some of the external reasons that the Minister cited as the causes of Zambia’s economic meltdown.

This year, Finance Minister will probably sing the same song since the economy has not recovered from its depression. Recently the Minister gave a statement on the economic status in which he told the nation that the Zambian economy had shrunken.

The Minister told Parliament that Zambia was experiencing slow economic growth, after a decade of accelerated progress. He explained the Zambian economy had shrunk due to external and domestic challenges Zambia faced.

The Minister also pointed the power crisis, high inflation rates, Policy reversals and high government spending as other causes of the economic meltdown.

As a result the Minister listed five pillars that he described as the programmes that would assist to recover the Zambian economy. He told Parliament that:

• The first pillar involved strengthening the tax policy and administration to improve revenue in flows and to shift public expenditure back to affordable levels.

• The Second pillar focused on increased budgetary allocation to social protection including addressing the plight of pensioners.

• The Third pillar aimed to improve economic and fiscal governance. This would involve strengthening of regulations and laws to make them more punitive to abusers and ensure transparency in the way the spending agencies arrive at economic and spending decision

• The fourth pillar centres on improving budget credibility. Better planning, and adherence to expenditure plans and improvement of the quality of Government’s spending.

• The fifth pillar focus on greater economic stability. With economic stability comes a better platform for economic growth and job creation. Without stability and market confidence, the private sector will not recover.

The listed pillars are the key elements that the Minister pin point as key to the recovery of the economy. It’s in this vein that as he presents his 2017 budget, the Minister should nd explain how best he could ensure that the Zambian economy gets back on the right path. The five pillars that Minister presented are  good but there is need to introduce industrious pillars that would ensure that the Zambian economy recovers. The listed pillars do not have the stamina to inspire the economic recovery.

What the Minister should have done is to identify the weak areas that had caused the Zambian economy to collapse. The Minister has not come out in the open to share with the Zambians on what transpired for the Zambian economy to collapse.

The Pillars also intend to suggest that the Zambian government had been insensitive in its expenditure. For instance, the Minister noted that budget credibility was a big concern adding that past variations to the budget had been as high as 25% when the discretionary budget was only around 2% of domestic revenues.

Therefore, as the Minister announces the Budget there is need for him to explain to the Zambians what had gone wrong with the Zambian economy. This explanation would help many Zambians to understand the way forward.

Hence the need for him to pick priority areas which he could use to drive the economy. He should share with the Zambians the priority financing area that would be able to accelerate the Zambian economy.

 

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One Response to This week: 2017 budget should outline key trategies for economic recovery

  1. After the budget everyone will sweat in wrong parts.

    Advocate
    November 10, 2016 at 8:42 am
    Reply

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