Zambia 2017 Budget Should Outline Strategies For Economic Recovery.
TODAY, Minister of Finance honourable Felix Mutati will present the national budget for the year 2017.
This is the first time the budget will be presented under a new republican constitution. It will also be the first time honourable Felix Mutati is presenting the national budget to P arliament.
Last year, then Minister of Finance Alexander Chikwanda did acknowledge the economic challenges that Zambia was facing and told P arliament 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, the 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 shrunk.
He told Parliament that Zambia was experiencing slow economic growth, after a decade of accelerated progress.
He explained that the Zambian economy had shrunk due to external and domestic challenges Zambia was facing.
The minister also cited the power crisis, high inflation rates, policy reversals and high government spending as other causes of the economic meltdown.
As a result, he listed five pillars that he described as the programmes that would assist to recover the Zambian economy.
He told Parliament that: • The first pillar involves the strengthening of the tax policy and administration to improve revenue in- flows and to shift public expenditure back to affordable levels.
- The second pillar focuses on increased budgetary allocation to social protection, including addressing the plight of pensioners.
- The third pillar aims at improving 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 decisions • 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 focuses 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 points as key to the recovery of the economy. It is in this vein that as he presents the 2017 budget, he should explain how best we should ensure that the Zambian economy gets back on the right path. The five pillars that the minister presented are good, but there is need to introduce industrious pillars that will ensure that the Zambian economy recovers. The listed pillars do not have the stamina to inspire the economic recovery.
What he should have done is identify the weak areas that had caused the Zambian economy to collapse. He has not come out in the open to share with the Zambians on what transpired for the 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 percent when the discretionary budget was only around two percent of domestic revenues.
Therefore, as he announces the budget there is need for him to explain to the Zambians what had gone wrong with the Zambian economy. This explanation will help many Zambians to understand the way forward.
Hence, there is 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 will be able to accelerate the Zambian economy.
The author is president of the Zambian Society for Public Administration and Society for Family Business.