Budget deficit hits 22 percent

Zimbabwe’s budget deficit is projected at 22 percent of the country’s gross domestic product, the London ‘Financial Times’ reported following the tabling in parliament on Thursday of supplementary spending estimates of US $1.3 billion.

The newspaper said that planned government spending this year will be 66 percent above the original budget. The report said the huge increase was due to a doubling of Zimbabwe’s debt-service charges to 36 percent of the budget; higher salary spending taking personnel costs to more that a third of the total budget; and a rise in defence spending, which now accounts for 9.3 percent of the budget.

Meanwhile, opposition Movement for Democratic Change (MDC) MPs walked out of the house as Finance Minister Simba Makoni presented his supplementary budget for approval. “From the MDC’s point of view, the spending syndrome that has characterised this government for the past 20 years will never go away, no matter what technocrat is appointed finance minister by ZANU-PF,” shadow finance minister Tapiwa Mashakada was quoted by the ‘Daily News’ as saying.

Makoni said the additional money was needed to cover salary increases and for the ministries of health, education and defence.