The country‘s management of revenue and expenditure has greatly improved setting the tone for sustained economic development.
Zimbabwe has had persistent budget overruns over the years largely due to recurrent expenditure, with little going towards capital expenditure.
Excessive government borrowing through floating of treasury bills and other instruments contributed to the issue prior to the implementation of financial sector reforms by the new dispensation.
Government’s adoption of an austerity stance and expansion of revenue streams has seen the country realising fiscal surpluses since 2019.
Two years back, the country’s revenue collector, ZIMRA collected net revenue of over 23 billion Zimbabwe dollars against a target of 18.6 billion, with the country posting a budget surplus equivalent to 25 percent of the revenue target.
In 2020, ZIMRA also surpassed revenue collection targets with the country posting a budget surplus of nearly 12 percent.
It is against this background that economists have applauded government’s prudence on managing its expenditures against its revenues.
“Over the past decade except for 2019 and 2020 statistics shows that financial authorities have been battling to contain expenditures which were outstripping revenue to the detriment of the economy in general. So what is currently happening shows if government balances its books it can have surplus to deploy when confronted with emergencies,” said Mr Titus Mukove
“The setting aside of the 100 million from government’s own resources is a huge statement that government is managing its resources well and will create a good perception for the country,” Mr Paison Tazvivinga said.
One of the major reasons why international financiers have not been extending aid to Zimbabwe was to do with credit unworthiness due to budget over-runs, hence the current situation presents a new lease of life to the country’s credit worthiness. – ZBC