Economy not down but public confidence: CZI

by Tawanda Musariri

The Confederation of Zimbabwe Industries (CZI) this morning praised Government interventions aimed at bringing normalcy in the money market and the larger macro economy.

The business body invited the media to spell its position and allay public panic over the upheavals that have brought shortages of basic commodities and inertia in the parallel currency exchange market.

Speaking to the media, CZI President Mr Sifelani Jabangwe said, “Despite the challenges the economy is currently facing, we believe the economy has been performing very well as noted by the upward review of GDP growth by the IMF and if we all do the right things, we will continue on this growth path.

“Businesses prefer to hold onto their stock whilst awaiting clarification on the value of RTGS. We have also seen the prices of commodities increasing in the market even where the producers have not increased prices. We note that this is a result of the imbalance between RTGS and Nostro accounts driven by the fiscal deficit and its financing through the creation of RTGS money. We recognise that any turnaround measures should start by addressing the fiscal deficit. We welcome the measures as highlighted in the Transitional Stabilisation Programme.”

The CZI also encouraged Government to sustain itself frugally, transparently and responsibly, noting the depressed economic environment and the need to collectively carry the economic stabilisation cross with the general citizenry.

“In order to give the market confidence that the programme shall be implemented successfully, Government must publish relevant data timeously. Given the critically low confidence levels in the economy we recommend the publication of the above as soon as possible,” said Jabangwe.

Turning to the contentious tax regime introduced by Finance Minister, Professor Mthuli Ncube, Jabangwe said, “The 2% tax, as subsequently modified by the Minister of Finance on 5 October, with further adjustments in consultation with the private sector, should go a long way towards closing the fiscal deficit and restoring stability to the economy. We therefore recognise the necessity of this tax as a short term shock therapy measure.

“We therefore call on all stakeholders to accept this painful necessity to stabilise the economy. We also call on Government to play its full part in stabilising the economy and sharing the associated pain by implementing the measures outlined in the TSP and returning to a zero deficit position as soon as possible

“We note that the economy has been growing despite the challenges and there is no doubt that if Government plays its part in restoring fiscal and monetary stability by living within its means, we will see a rapid stabilisation of the economy and continued growth towards making this country a middle income economy by 2030.”

The CZI is a respected grouping of captains of industry and their analysis and counsel on economic matters is respected by the pulse of the economy locally and abroad.