Zimbabwe Budget Highlights

Finance Minister Tendai Biti presented the budget this Thursday which centred on job development and decentralisation of the economy.

Below are the highlights

  • Budget to work towards equal treatment of provinces
  • Budget revalued and projected to $4billion up from $3.6bn due to expected diamond receipts
  • Overall growth for 2011 is projected to be 9.3% and 9.4% in 2012
  • Zimbabwe’s economy is becoming more diversified
  • Agriculture needs $2 billion annually if it is to realise its full potential (was allocated 226 million). There will be introduction of 3-year rolling finance strategy for agriculture in February  2012
  • Mining grew by 25.3% in 2011 and is expected to grow by 33% in 2012. Mining export breakdown – Platinum is 45% export gold is 24, diamonds 14% %
  • ICT is the fastest-growing sector of the economy
  • Annual Inflation started at 3.5%, then 2.5% by second quarter then 3.3%. Rent is biggest driver of inflation. Target to keep inflation under 5% in 2012.
  • Exports will grow by 30.2% 2011 and over 15% in 2012… 50% are mineral exports
  • 56% of exports are going to South Africa. 6% for China and UAE each
  •  We import 52% from SA, USA, (11%) and Kuwait (6%)
  • US , UK and EU remain highest development assistance partners
  • 31% revenues coming from VAT and direct taxes are at 30%
  • USD100 million fund to help restore inter-bank lending and restoration of Reserve Bank as lender of of resort.
  • $60 million for broader industrial revitalisation
  • $6.5 million for livestock development
  •  Government will pay companies to employ graduates. Fund set aside.
  • $800 million for capital development projects
  • $7 million provided for rural electrification and every province to benefit
  • $39.5million for water and sanitation development
  • $41.5 million for road infrastructure development
  • $5million for the fiber-optic backbone
  • $5.1 million for migration of ZBC to digital
  • $18 mil for automation of ZIMRA
  • $707 million for education
  • $445 million for maternal health care… fees etc
  • Government spreading the clusters of the economy so that all regions benefit
  • Borehole to be constructed at every school in the rural areas … easier access to water for women in the rural areas
  • $22 million for Census in 2012
  • Investment to be made in a green economy – no figure given
  • Duty on maize meal and cooking oil will be retained. we reached our target for strategic grain reserve
  • wheat will still be imported duty-free. pre-packed rice and flour and salt will attract duty
  • Tax-free thresh-hold up to $250/month
  • Bonus tax-exempt threshold is $700
  • VAT remittance date to move to 25th of the month
  • Ambulances/firefighting/water and sanitation equipment imported duty-free
  • Donated goods to genuine Sports association will be duty free
  • ZIMRA to be the only collection agent at border posts
  • Royalty on gold and platinum up 7% and 10% respectively 
Given the resources he had, the minister has done well at trying to present balanced budget. It seeks to decentralise the economy and the creation of clusters is particularly welcome. It also laid a significant emphasis on protecting the local economy and being pro-poor.
For other highlights you can find them on Twitter

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