By Costa Nkomo
Finance and Economic Development Minister Professor Mthuli Ncube has been called upon to explain a US$3 billion budget deficit incurred after the country switched to the new Zimbabwe Gold currency (ZiG) in April.
This demand came from Citizens Coalition for Change (CCC) Finance Shadow Minister Corban Madzivanyika, who claimed that the 2024 budget has been eroded by nearly US$3 billion.
Speaking to journalists soon after the Mid Term Review statement by Ncube, Madzivanyika said: “The approved 2023 budget was around ZW$ 58 trillion, equivalent to 9.7 billion dollars back then.”
“Fast forward to July 2024, in his Mid-Term fiscal review statement, the minister says the current budget is now ZiG 87 billion, which is equal to 6 billion dollars using a rate of 14.5. It is so worrisome that the budget has been eroded by close to 3 billion dollars.”
Madzivanyika demanded a detailed explanation from Ncube regarding this significant deficit. However, the debate was adjourned by the Speaker before MPs debated it.
Ncube’s explanation for the budget shortfall was simply that “the introduction of the ZiG as legal tender on 5 April 2024 has necessitated reconfiguration of the 2024 approved national budget to reflect the change of our currency.” This explanation, however, was deemed insufficient by Madzivanyika, who demanded a more thorough accounting of the missing funds.
Ncube’s mid-term review also revealed a worrying trend of government overspending. “In terms of performance during the first six months of the year, revenue collections amounted to ZiG 36.5 billion against expenditures of ZiG 38.9 billion dollars,” said Ncube.
The review also downgraded the projected economic growth from 3.5 percent to 2 percent, citing the impact of the El Niño-induced drought on the agricultural sector.
