Finance minister Patrick Chinamasa has projected the economy to grow by 1,7% next year buoyed by growth in agriculture and mining.

Presenting the $4,1 billion 2017 national budget yesterday, Chinamasa said the economy was projected to grow by 0,6% this year but would improve next year.

“In 2017, the economy is set to turn around from the slowdown mode to modest growth led by key sectors of mining and agriculture, benefitting from the anticipated normal to above normal rainfall. Overall GDP growth is, therefore, projected at a moderate 1,7% in 2017, also against the background of anticipated moderate improvements in international commodity prices, fruition of planned mining investments and benefits from the ease of doing business reforms,” he said.

The growth projection is a sober one after Treasury had earlier forecast a growth rate of 4,8% in its strategic paper.

Revenue will be $3,7 billion leaving a financing gap of $400 million, Chinamasa said.

“The fiscal framework of revenue collections of $3,7 billion and projected expenditures of $4,1 billion presents a financing gap of about $400 million, which is 2,7% of GDP, for the proposed 2017 budget,” Chinamasa said.

The 2016 financing gap had been projected to be $150 million. Chinamasa said the projected financing gap in 2017 would be an improvement on the anticipated 2016 unsustainable financing gap of $1,18 billion outturn, given projected total revenues of $3,53 billion, against anticipated expenditures of $4,59 billion.

Employment costs would take $3 billion, leaving $400 million for current operations and $180 million for debt services out of the overall proposal for recurrent expenditures of $3,58 billion.

Capital expenditure will have $520 million, which is 14% of total revenues from the national budget. Chinamasa said the desired levels for capital expenditure on the capital budget for implementation of ZimAsset project was $5,4 billion.

“The 2017 budget provision of $3 billion for employment costs represents decline from the estimated outturn of $3,14 billion to year end 2016. The anticipated lower provision on employment costs by an estimated $140 million is reflective of financial savings arising from the implementation of the Public Service Wage Bill rationalisation measures,” he said.

Chinamasa said a severe drought, for the second consecutive year, had a heavy toll on agriculture production, with some crops, such as maize, recording merely 511 000 tonnes, against the average national requirement of 1 800 000 tonnes, resulting in a huge import bill for the country. Consequently, agriculture recorded a growth decline of -3,7% in 2016. However, in 2017, Chinamasa said agriculture was projected to grow by 12% driven by higher output from major crops such as maize, cotton and tobacco, as well as milk production.

He said the country needed to gradually revert back to the cash budgeting framework tenets, through ensuring that all line ministries adhere to allocations and spend as and when resources are available.

Chinamasa proposed a moratorium on Treasury bill issuances and confining borrowing at concessional rates from external sources for development programmes. The government has been resorting to issuing Treasury Bills to finance the gap caused by the mismatch between revenue and expenditure.

“In tandem with the above, government will also start addressing the fiscal gap through a number of expenditure management measures backed by revenue increasing interventions anchored on stimulation of production,” he said.

Chinamasa said the country would next year clear its arrears with other multilateral creditors such as the African Development Bank ($610 million), the World Bank ($1,16 billion), the European Investment Bank ($212 million) and other multilateral institutions as well as bilateral official creditors, after it cleared its $108 million debt with the International Monetary Fund.

Commenting on the budget, former Finance minister Tendai Biti said one cannot expect to get different results from the same figures. For instance, this year’s budget was projected at $4 billion and the growth projects were revised to 0,6% by Chinamasa.

Biti rapped the proposal to levy 5 cents for every dollar on airtime and data to finance the health fund.

“It has nothing to do with health. it’s a fundraising initiative. Government can have a proper health care that should work, not these levies, which are punitive. This is a political move to push people away from social media that has been against this regime,” he said.

Biti said the country was in a recession and heading towards economic depression and it required a fundamental shift with major cost cutting measures.

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2017 National Budget Statement

Extracts from the National Budget Statement presented to the Parliament of Zimbabwe by Hon. Patrick A. Chinamasa, MP Minister of Finance and Economic Development, on 8 December 2016

The 2017 National Budget Statement constitutes the fourth Budget for implementing our Zim Asset, whose mission is “Providing an enabling environment for sustainable economic empowerment and social transformation to the people of Zimbabwe”.

The economy is still confronted with a number of headwinds, which continue to restrain sustainable and equitable economic growth.

Domestic Production

The fundamental challenge remains that of under-production, entirely across all sectors of the economy.

This economic under-performance is notwithstanding vast strengths and opportunities in agriculture, manufacturing, mining and tourism, arising out of our diverse natural resource endowment, conducive climatic conditions, and trained human resources.

The 2017 Budget, therefore, proposes interventions targeted at increasing domestic production.

Entrepreneurship

We, however, have to maximise returns on our human capital by reversing the prevailing mentality of trained personnel being contented to remain, first and foremost, as employees.

Central to this is broadening the culture of entrepreneurship among our people, inclusive of readiness to embark on business risky ventures.

Reform Thrust

The major challenge for the 2017 National Budget is, therefore, taking the lead in ‘walking the talk’ with regards to implementing critical reforms to:

• re-orient fiscal resources towards Zim Asset developmental programmes;

• strengthen interventions to stimulate production and supply across the various sectors;

• finalise the outstanding components of the re-engagement process with international financial institutions;

• entrench structural reforms to improve the domestic business and investment environment, vital for restoration of confidence, lowering the ease and cost of doing business and product competitiveness; and

• support implementation of poverty reduction programmes and projects highlighted in the IPRSP.

Accordingly, consistent with the above objectives, the 2017 National Budget is centred on the theme “Pushing Production Frontiers to Potential Levels Across all Sectors of the Economy”.

Consequently, this Budget, therefore, proposes corrective measures on fiscal and external imbalances to restore fiscal and debt sustainability, which provides a conducive environment for productive activities.

Specifically, while as alluded to above, fiscal imbalances will require containment of expenditures, implementation of strong structural reforms will entail:

• shedding off those State Enterprises that would benefit from joint venture partnerships with identified strategic investors;

• improving performance of those State Enterprises that remain;

• reducing policy uncertainty;

• fighting corruption in an effective way;

• enhancing competitiveness;

• enforcing guidelines on good corporate governance in public enterprises and local authorities; and

• building strong systems for ensuring transparency and accountability.

In the absence of a robust fiscal adjustment and structural reforms as well as arrears clearance, the persistent deterioration in the macro-economic environment will continue to incapacitate the country’s ability to honour its obligations to all its creditors and to move forward.

Safety Nets

Furthermore, under the challenging socio-economic environment, Government, under this Budget, will pay attention to alleviating increasing hardships afflicting the vulnerable segments of our population.

Central to this, will be interventions to empower vulnerable groups to participate meaningfully in economic and business activities across the various sectors, including in agriculture.

Without increasing production, it will remain difficult for the Government to have meaningful capacity to strengthen social safety nets, in line with the objectives of the Interim Poverty Reduction Strategy Paper (IPRSP) for 2016-2018.

Furthermore, as the 2018 Election year approaches, upholding an atmosphere of tranquillity, tolerance and minimum polarisation, supportive of conduct of economic activity will also be central.

In contextualising the key issues of the 2017 National Budget, this Budget Statement gives an outlook for the economy, including the appropriate fiscal framework, and some of the specific fiscal interventions, as well as critical structural policy reforms.

Economic outlook

The economy, notwithstanding resilience, remains under stress, principally on account of low domestic production across the various sectors – that is in agriculture, mining, manufacturing, tourism, construction, as well as in the other service sectors.

While the recent El-Nino induced drought had an effect on farming output, and depressed international commodity prices on mineral exports, reduced output across the other sectors is also reflective of the need for increased investment, both domestic and foreign.

This will require a complementary conducive doing business environment, as well as finalising the external payment arrears situation to help improve access to lines of credit.

In manufacturing, over-dependence on imports, against the background of the strong US dollar and a weakening South African rand, had undermined companies’ competitiveness over both the domestic as well as export markets.

The above adverse effects on agriculture, mining and manufacturing, as a result, meant low domestic production underpinning the prevailing low capacity utilisation across sectors, low incomes, high unemployment levels, domestic liquidity and cash challenges.

The low domestic savings base, inclusive of the fiscal deficit, also meant continued absence of domestic financial resources which limited local domestic investment.

Against this background, the overview for the overall economic outturn in 2016 is for real growth estimates of only 0.6%.

In 2017, the economy is set to turn around from the slowdown mode to modest growth led by key sectors of mining and agriculture, benefitting from the anticipated normal to above normal rainfall.

Overall GDP growth is, therefore, projected at a moderate 1.7% in 2017, also against the background of anticipated moderate improvements in international commodity prices, fruition of planned mining investments and benefits from the ease of doing business reforms.

Manufacturing

Manufacturing, which continues to face such constraints as antiquated equipment, capital, low aggregate demand, liquidity, high costs of utilities, and unfair competition from imports, is projected to register modest growth of 0.3% in 2017.

The thrust of the 2017 Budget interventions, in line with the Zim Asset, will centre on sustaining the evening of the playing field, re-kindling business confidence, and enhancing competitiveness through lowering the cost of doing business and improving the business and investment environment.

With regards to evening the playing field, initial results from an evaluation of the impact of SI 64 indicate gains in capacity utilisation across such sub-sectors as milling and baking; food, fruits and vegetables processing; iron and steel making; battery manufacturing; packaging; pharmaceuticals; and furniture manufacturing, among others.

Government continues to monitor impact of this instrument on investment into re-equipping, increased production and creation of employment.

This should also benefit from Government initiatives in support of the promotion of value chains, especially those linkages between agriculture and the manufacturing sector.

Already, notable linkages are accruing under the recently promoted cotton to clothing, beef to leather and agro-processing value chains.

The introduction of the 5% bond note export incentive through the Reserve Bank also proffers benefits for improved domestic production over the coming year.

Export Performance

A downturn in overall export performance is estimated for 2016, with exports falling by 6.9% to US$3.365 billion, from US$3.614 billion last year.

Under the prevailing multi-currency arrangement, export receipts represent the economy’s anchor source of the economy and banking sector cash and liquidity.

The reversal of the worrisome decline in exports requires intervention measures to restore competitiveness and diversification of the economy’s export base across all sectors, including remittances of non-residents.

Foreign Capital Inflows

The current huge savings-investment gap requires that the country establish a highly competitive environment to attract external savings through external capital inflows comprising of FDI, portfolio and other offshore loans.

Capital inflows are expected to reach US$692.4 million in 2016, against US$1.2 billion recorded in 2015.

Given the declining trends and the low levels of foreign capital inflows, it is imperative that the country continues to expedite the re-engagement process with the international financial institutions.

Furthermore, it is critical to increase the impetus on the implementation of the on-going ease of doing business reforms as well as ensuring policy clarity, in order to boost investor confidence.

Imports

The economy’s relatively high import bill remains unsustainable at US$5.35 billion in 2016, against exports of US$3.365 billion.

The prioritisation of essential imports through implementation of such temporary imports prioritisation instruments as SI 64 in favour of promoting the importation of such critical imports as raw materials and replacement equipment is, therefore, central to the Zimbabwean economy contributing positively to regional economic performance.

Expenditure Proposals

The 2017 Budget proposes Vote Appropriations of US$3.4 billion, inclusive of Employment Costs of US$2.52 billion, Operations and Maintenance of US$400 million and Capital Expenditures of US$520 million.

Constitutional and Statutory Appropriations have been allocated US$673.7 million, resulting in overall Budget Expenditures of US$4.1 billion.

Allocations under the 2017 Budget are primarily directed at priority areas, drawing from Zim Asset clusters namely:

• Food Security and Nutrition;

• Value Addition and Beneficiation;

• Infrastructure and Utilities; and

• Social Services and Poverty Eradication.

Line Ministries and Departments will, therefore, be required to design implementation of their projects and programmes in line with Zim Asset clusters, to create synergies, necessary for optimising on the little resources available, for the achievement of Zim Asset.

Prioritised Zim Asset cluster based projects and programmes include those identified under the Interim Poverty Reduction Strategy Paper (IPRSP) for 2016-2018, which was formulated with support from development partners, including the World Bank and the European Union.

Overall Allocations

The 2017 National Budget proposes an allocation of US$1.35 billion towards health, social welfare and education Ministries under the Social Services and Poverty Eradication cluster.

Social safety nets have been allocated US$78 million in order to cushion the vulnerable groups of our population in terms of health, education and social welfare programmes.

Given the centrality of agriculture in terms of food security and support to other sectors, an allocation of US$303.2 million is being proposed under this Budget.

With regards to the Infrastructure and Utility cluster, the 2017 Budget sets aside US$188 million, which will be complemented by resources from statutory funds, respective state owned enterprises, development partners and loan financing.

Revenue Measures

The revenue measures that I am proposing seek to enhance the support that has already been availed to industry through tax relief and modest protection, enhance revenue and efficiency in tax administration.

Support to Industry

In an effort to boost domestic production and value addition against declining exports, Government has supported industry through prioritisation of critical raw material imports and levelling the playing field using such temporary import prioritisation instruments that include tariffs and SI 64 of 2016.

Consequently, industry capacity utilisation has increased significantly from 34% in 2015 to the current level of 47%.

Government measures to support the resuscitation of industry will have to be complemented by manufacturers playing their part with regards to guaranteeing quality of goods, as well as competitiveness of prices.

Tax Relief Measures

Tax Incentives for Special Economic Zones

Government enacted the Special Economic Zones legislation in order to attract foreign direct investment and enhance the economy’s capacity to produce goods and services competitively.

In order to enhance the attractiveness of the Special Economic Zones, it is proposed to provide tax incentives as follows:

Tax Head	Proposed Incentive
Corporate Tax	Exemption from Corporate Income Tax for the first 5 years of operation. Thereafter, a corporate tax rate of 15% applies.
Special Initial Allowance	Special Initial allowance on capital equipment to be allowed at the rate of 50% of cost from year one and 25% in the subsequent two years.
Employees’ Tax	Specialised expatriate staff will be taxed at a flat rate of 15%.
Non-Residents Withholding Tax on Fees	Exemption from Non-residents tax on Fees on services that are not locally available.
Non-Residents Withholding Tax on Royalties	Exemption from Non-residents tax on Royalties.
Non-Residents Withholding Tax on Dividends	Exemption from Non-residents tax on Dividends.
Customs Duty on Capital Equipment	Capital equipment for Special Economic Zones will be imported duty free.
Customs Duty on Raw Materials	Inputs which include raw materials and intermediate products imported for use by companies set up in the Special Economic Zones will be imported duty free. The duty exemption will, however, not apply where such raw materials are produced locally.

The tax incentives will apply in demarcated geographical areas and are restricted to production for export.

This measure takes effect from 1 January 2017.

Taxation of Small to Medium Enterprises

Small to Medium Enterprises (SMEs) play a critical role in the economy, hence, account for a significant portion of the gross domestic product and employment creation. Initiatives by SMEs have, thus, greatly assisted in poverty alleviation and economic empowerment.

In support of this important sector of the economy, Government has already committed to implementing policies, programmes and strategies aimed at resolving the perennial challenges experienced by SMEs. These challenges include inadequate financing, improper infrastructure and lack of requisite entrepreneurial, marketing and management skills, among others.

In order to further enhance the growth of SMEs, thereby creating an environment conducive for their participation as anchors of economic development, it is necessary to provide additional support measures:

Registration for Value Added Tax

In order for SMEs to transact with private and public sector entities as corporate suppliers within the value chain, they must be registered for VAT. This will enable the established corporates to claim input tax on goods and services supplied by the SMEs.

However, most SMEs are not registered for VAT, hence they cannot take advantage of existing market opportunities as corporate suppliers. In addition, they miss out on benefits such as improved quality control and technology and skills transfer that are derived from dealing with large businesses.

Most SMEs are, however, reluctant to register for VAT, due to the massive backdated taxes and penalties that they are likely to incur upon registration.

In order to facilitate VAT registration for SMEs that qualify on account of their gross turnover exceeding the threshold of US$60 000 per annum, it is proposed to waive the requirement to account for output tax from the deemed date of qualification for registration.

Eligible SMEs will, thus, account for VAT from the date of registration.

This incentive will apply to SMEs whose turnover does not exceed US$240 000 per annum and also voluntarily register for VAT with the Zimbabwe Revenue Authority.

This moratorium will be effective over a period of six months beginning 1 January 2017.

Provisional Tax

Furthermore, SMEs that voluntarily register with the Zimbabwe Revenue Authority will only account for provisional tax during the first year of registration, when the Fourth Quarterly Payment Date falls due.

Alternatively, qualifying SMEs may account for provisional tax on a monthly basis.

However, SMEs that are compelled to register for tax after an audit by ZIMRA, will not benefit from the above incentives.

This measure takes effect from 1 January 2017.

Presumptive Tax

In view of the increase in unregistered businesses, Government introduced presumptive taxes on selected sectors of the economy such as restaurants, bottle stores, the cottage industry, hair salons, and commuter omnibus operators, among others, in order to broaden the tax base.

However, despite measures instituted to capture the revenue inflows from the informal sector, revenue contribution to the fiscus remains insignificant, due to low compliance.

The informal sector largely view taxes as an additional cost to business. This is despite the expectation that Government should provide quality social services.

Furthermore, due to the liquidity constrains that are currently being experienced, business operations in the informal sector are generally low.

It is, therefore, proposed to review downwards, presumptive taxes and the payment period from quarterly to monthly basis, with effect from 1 January 2017, as shown in Annexure 19.

The Ministry of Small and Medium Enterprises Development and approved SME Associations, will work together, in order to ensure compliance.

Revenue Collected from SMEs

I have already identified inadequate working capital as one of the hindrances to the growth of SMEs.

It is, therefore, proposed to ring fence revenue generated from presumptive taxes towards capitalisation of the Small and Medium Enterprises Development Corporation (SMEDCO) for on-lending to SMEs.

Taxpayer Education

In order to sustain efforts to formalise SMEs and enhance taxpayer compliance, particularly with regards to registration, filing of tax returns and payment of tax, the Zimbabwe Revenue Authority will intensify training programmes in collaboration with the responsible Ministry.

The level of education received by taxpayers is an important factor that contributes to their understanding of their tax obligations.

VAT Exemption on Banking Services

Technological advancement has resulted in the adoption of new methods of banking, which include mobile banking. This has brought convenience to the banking public and assisted in resolving some of the payment challenges arising from the current cash shortages. In some areas this has promoted financial inclusion for the unbanked population.

Such innovative services are, however, subject to VAT. This is in contrast to the VAT exemption on services offered by the traditional financial institutions.

In order to support the growth of these innovative banking and payment solutions, thereby enhancing financial inclusion, it is essential that we level the playing field within the financial services sector.

It is, therefore, proposed to exempt banking and payment solutions offered by any person registered under the National Payments Systems Act from VAT.

It is my legitimate expectation that the benefit of the exemption will be passed to the consumer.

This measure takes effect from 1 January 2017.

Electronic Cargo Tracking System

In order to mitigate the adverse effects of transit fraud, Government, with the assistance of the African Development Bank, has put in place an Electronic Cargo Tracking System. The facility allows for tracking of transit cargo from point of entry to point of exit.

The Electronic Cargo Tracking System will enhance efficiency in clearance and management of transit cargo and also minimise transit fraud.

The facility is currently on a trial phase along the Beitbridge to Chirundu, and Forbes to Chirundu routes.

CCTV

In an effort to curb corruption and smuggling, Government implemented the CCTV systems at Beitbridge Border Post. The system, which has been running for the past four months has begun to bear fruit, with some corrupt elements now being apprehended.

Legislative Amendments

• Reduce debt redemption levy on petrol by 1 cent per litre, with effect from 1 January 2017;

• Exempt Government from Carbon Tax Debt Redemption and Strategic Reserve Levies;

• Provide for exemption of VAT on Radiation Protection Service for the period 2011 to 2015, in order to cover the legacy debt of the Authority;

• Extend VAT zero rating to the supply of pipeline transportation, storage and handling services for purposes of delivery of fuel through the pipeline, with effect from 1 January 2017;

• Extend deferment of export tax on un-beneficiated platinum to 1 January 2018;

• Include supply of gold to Fidelity Printers and Refineries on the list of VAT zero rating.

• Eliminate double taxation on presumptive taxes payable under informal traders’ tax;

• Amend the carbon tax rates charged on foreign registered motor vehicles to a uniform rate of US$10 per month, with effect from 1 January 2017;

• Amend the Revenue Authority Act to allow the Board to appoint the Commissioner General of ZIMRA with the approval of the Minister;

• Income tax exemption on Investor Protection Fund, which no longer falls under the Securities and Exchange Commission Act;

• Tax Exemption for Zimbabwe Asset Management Company with effect from 15 July 2014 instead of 1 January 2016.

Structural Policy Initiatives

The thrust of this and future Budgets is also to overcome all arising structural bottlenecks to business activity and the investment environment, targeting both domestic as well as foreign investors.

For the coming fiscal year, focus is on lowering the cost of doing business by further implementation of reforms to improve:

• Competitiveness;

• Ease of doing business;

• Policy consistency;

• Public entities’ performance;

• Public finance management;

• Public procurement; and

• Corporate governance and accountability.

Competitiveness

The country’s investment and growth prospects are being weighed down by low competitiveness emanating from a number of areas as indicated in the World Bank’s Doing Business Index.

These include unreliable supply of utilities, limited access to affordable financing, delays at ports of entry, as well as multiplicity of licences and fees, among other business and investment constraints that raise the cost of doing business.

As a result of the above weaknesses, the recent 2016 World Bank Doing Business Index Report ranked Zimbabwe at 161 out of 191 countries from 157 of 2015.

The identified shortcomings provide useful lessons and information for improvement on those areas with weaknesses, and in this regard Government is doubling efforts on furthering the necessary reforms.

To that end, Government will be launching another 100 day cycle under the Rapid Results Based Approach being spearheaded by the Office of the President and Cabinet to improve the competitiveness of domestic companies.

Ease of Doing Business

His Excellency, the President, outlined during his State of the Nation address last year the Rapid Results Initiative to significantly improve Zimbabwe’s Doing Business rankings.

Pursuant to this, Government has since undertaken an extensive review of the bottlenecks and challenges that have stalled progress in the advancement of Zim Asset objectives to generate both domestic and foreign direct investment into the economy.

This review has informed a raft of policy, institutional, legal and regulatory reforms that are expected to significantly improve the business environment, considerably enhance access to finance for SMEs and entrepreneurs, and contribute to making Zimbabwe an investment destination of choice.

Some of the imminent legislative reforms are the introduction of:

1. a Movable Property Security Interest Bill to permit creation of a Collateral Registry and, thereby improve access to finance for SMEs by allowing them to use movable assets as collateral.

2. a Companies Amendment Bill to modernise the legal regime and enhance, amongst others, processes for business entry, business administration and protection of minority investors.

3. an Insolvency Bill to ensure accountability and efficient insolvency proceedings that permit unsalvageable companies to be quickly liquidated and viable firms to be revived, thus preserving jobs.

4. a Judicial Laws (Ease of Settling Commercial and other Disputes) Amendment Bill, to ensure expeditious resolution of commercial disputes.

5. Deeds Amendment Bill to allow for electronic management of the Deeds Registry.

6. a Procurement Bill.

The 2017 Budget will, therefore, make available the resources that will ensure effective implementation of the laws and the development of the institutions required to ensure consistent improvement of Zimbabwe’s business environment.

Over the next year, Government will:

1. overhaul the business registration process, in order to offer entrepreneurs prompt formal business entry.

2. introduce financial sector infrastructure, that will permit the use of movable assets as collateral.

3. reform the insolvency regime, in order to permit the rescue of viable businesses and the prompt and efficient liquidation of unviable businesses.

4. improve access to the Courts of Law, in order to permit the expeditious resolution of commercial disputes, and,

5. simplify the payment of taxes and trading across borders, which will contribute to making the country a preferred investment destination for citizens and foreigners alike.

Policy Consistency

Policy inconsistencies have serious negative impacts on the performance of our economy, as well as on the outcomes of the on-going reengagement process.

It is, therefore, critical that Government remains speaking with one voice on any policy direction so as to avoid any unnecessary misinterpretation by the public and investors.

The Office of the President and Cabinet will be, therefore, coordinating policy pronouncement as well as any required clarifications to avoid conflicting interpretations of policies by different Government Ministries and Departments.

Anti-Money Laundering

Pursuant to the adoption of the Anti-Money Laundering second round Mutual Evaluation Report on Zimbabwe in September 2016, Government is developing a comprehensive Post Mutual Evaluation Implementation Plan that seeks to consolidate reforms instituted over the past 3 years and addressing deficiencies.

Further to this, Government is undertaking a capacity building and institutional strengthening process, targeted at law enforcement agents, the Financial Intelligence Unit and other related Anti-Money Laundering and Combating the Financing of Terrorism reporting institutions.

Conclusion

This Budget marks a turning point towards a developing economy through fiscal consolidation and stimulation of production.

The success of the proposed measures can only be meaningfully realised through the collective responsibility of all stakeholders, through sustained implementation, anchored by policy consistency, credibility, predictability and coherence, which by and large we have now been able to achieve through sustained effort.

Robust fiscal adjustment and structural reforms, as well as arrears clearance, are also crucial to the promotion of a business environment conducive for sustainable production and entrepreneurship.