Medium Term Plan awaits Cabinet nod

been established.
The five-year economic blueprint is expected to provide a framework for a National Economic Development Strategy to achieve sustainable growth and development.
Permanent Secretary in the Ministry of Economic Planning and Investment Promotion Dr Desire Sibanda confirmed that the revised Medium Term Plan document has been finalised and was awaiting Cabinet approval.
“The proposed economic blueprint is finalised and we hope it will suit the needs of the economy in the short to long term,” he said.
The MTP is targeted to supersede the previous macro-economic policies, the Short-Term Economic Recovery Programme (STERP) and STERP II.
Cabinet rejected the initial MTP document in June last year on the basis that its main targets were unrealistic and unlikely to facilitate economic recovery.
For instance, one of the major points of concern was that it proposed to raise more than US$20 billion in a five-year period from external financiers, focusing on foreign direct investment to boost economic activity.
It also projected a 15 percent annual growth in Gross Domestic Product after five years.
An estimated US$800 million was required to initiate the MTP last year, at a time when there was little coming in the way of external financial support for the local economy.
The economy is this year facing financing challenges as indicated by both the Ministry of Finance and an International Monetary Fund team that was in the country recently on the periodic Article IV consultations.
Zimbabwe’s monetary resources at present are inadequate to establish parity between domestic revenues and expenditure.
Government has had to revise proposed targets for the MTP to comply with economic requirements through focusing on strategies to solve capital constraints, boost industrial productivity, restore business confidence, unlock export receipts from locally produced goods and create jobs.
Timely promulgation of the economic blueprint would have resulted in it dovetailing into the three-year Macro-Economic and Budgetary Framework 2010-2012 that was launched in 2009 by the Ministry of Finance.
To the extent of its proposed linkage to the Macro-Economic and Budgetary Framework 2010-2012, the MTP was supposed to be a critical determinant of this year’s financial plan.
Nonetheless, the MTP is premised on the need for the economy to restore productive capacities, infrastructure rehabilitation and improvements, diversification of economic growth sources, investment in new technologies, and a number of key institutional and non-institutional reforms.
The country’s productive capacities currently stand at around 45 percent. However, overall economic growth for 2011 has been projected at about 9 percent.