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2008 budget statement
Ministry of Finance
November 29, 2007

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Motion

1. Mr Speaker Sir, I move that leave be granted to bring in a Bill to make Provisions in connection with Revenues and Expenditures of the Republic of Zimbabwe for 2008 and to make Provisions for matters ancillary and incidental to this purpose.

Introduction

2. Allow me to begin by expressing my sincere gratitude to Honourable Members of Parliament for the support and guidance they continue to provide me in the formulation and implementation of the National Budget.

3. The Budget formulation process also benefited from wide inputs following consultations with other stakeholders in the major centres countrywide.

4. I believe it is through such engagement that we develop and build the necessary consensus for us to prevail over our economic challenges.

5. As Honourable Members are aware, our economy is confronted with the twin challenges of economic contraction and high inflation.

6. Rising inflation has been felt across the entire spectrum of our society, making the budgeting process difficult. Budget implementation is equally undermined as frequent adjustments to prices of goods and services erode the purchasing power of Ministries' allocations, compromising delivery of essential services.

7. By increasing the cost of doing business, inflation also reduces the scope for long-term planning, growth and development. The impact on the general population is loss of jobs in the formal market and declining real incomes.

8. The thrust of the 2008 National Budget is, therefore, geared towards stabilising the economy, increasing productivity and lowering inflation. This will be driven by the 2007/2008 agricultural season which has been dubbed the Mother of All Agricultural Seasons.

9. Accordingly, budgetary support and other fiscal incentives will be availed to agriculture and to the other productive sectors of the economy.

10. Deliberate interventions will also be targeted towards support for small and medium enterprises (SMEs) and grass-root productive activities under Women, Youth and other Community initiated programmes. These are labour intensive, and offer considerable opportunities for employment and income generation for communities.

11. Consequently, this Budget has been dubbed The People's Budget. It is dubbed The People's Budget because it is geared to reduce inflation by enabling communities at grassroots level to generate their own goods and services at affordable prices.

12. The anticipated increase in production, on the back of Government interventions, will have the effect of reducing prices, thereby placing the economy on a sustainable recovery and growth path characterised by declining inflation.

13. Mr Speaker Sir, before highlighting the specific measures to support the recovery of our economy, allow me to first review our domestic economic developments since January, and fiscal performance to October 2007.

(Contined..)

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