Deputy Finance Minister Mnangagwa Stresses Urgent Need for Financial Mobilization in Zimbabwe

by Ikeoluwa Ogungbangbe

Zimbabwe’s recently-appointed Deputy Finance Minister, David Kudakwashe Mnangagwa, underscored the pressing requirement for fresh, resourceful strategies to galvanize both public and private funds. This drive is essential for the nation’s sustainable economic growth.

This urgent call aligns with the Treasury’s projection. It stipulates that Zimbabwe needs a substantial US$40 billion capital injection if the nation aims to achieve upper middle-income status by the decade’s end, in 2030. However, efforts to secure such funds have been challenging.

Multiple factors compound this difficulty: Zimbabwe grapples with a daunting public debt of over US$20 billion, fluctuating exchange rates, policy shifts, and escalating societal demands. Additionally, lingering disputes stemming from the results of the general elections in August have further deterred potential investors.

Speaking at the Zimbabwe Economic Development Conference (Zedcon) in Victoria Falls, Mnangagwa emphasized, “We must pivot towards new financial blueprints, amplify private capital infusion, and foster collaborative endeavors among government entities, businesses, and non-profit sectors. Our esteemed academic institutions play a pivotal role, transforming their rigorous research into tangible, actionable insights.”

Mnangagwa expressed optimism about the conference, noting its crucial role in uniting pivotal players – policymakers, entrepreneurs, researchers, civil society representatives, and media professionals. Their collective goal? Brainstorming sustainable and inventive strategies to bolster Zimbabwe’s financial reservoir.

Acknowledging the country’s multifaceted financing frameworks, he suggested delving deep to unearth inventive solutions to foster economic growth. “The onus is upon us to ramp up domestic resource accumulation, especially since external funding avenues currently seem constricted. Enhancing in-house resource initiatives is paramount to successfully back the NDS 1 initiatives, particularly as we transition into the latter phase of the National Development Strategy.”

The conference is instrumental for the Treasury, which is utilizing insights from Zedcon in drafting the upcoming 2024 National Budget.

Offering a solution-oriented perspective, Prosper Ziyadhuma, a research fellow at the Zimbabwe Economic Policy Analysis and Research Institute, highlighted public-private partnerships (PPPs) as a viable route, especially for infrastructure development. “Clear legal guidelines, coupled with sound feasibility studies, pave the way for mutually beneficial PPP contracts. However, for PPP projects to lure private investment, there’s a need for solid financial modeling, genuine revenue forecasts, and a guarantee of steady cash flow.”

Ziyadhuma also emphasized the importance of including key stakeholders like local communities and ensuring rigorous governance structures are in place to oversee the transparency and efficacy of all PPP endeavors.

SOURCE: NewsDay 

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