Editorial Comment: A lot learnt from 2015 challenges

Tomorrow, Zimbabwe bids farewell to another tough year socially and economically, hopeful that 2016 will be better.

This year saw a continuation of economic difficulties that manifested themselves in a dangerously low inflation rate, declining industrial capacity utilisation, a poor agricultural season and the resulting food shortage and job losses.

In his summation of the year, President Mugabe was clear that 2015 was indeed a hard year for Zimbabweans but praised them for their resilience. Speaking at a Christmas reception at State House last week Monday, the President expressed hope that the economic challenges would ease next year.

That the reception was a modest one only attended by ministers, Politburo and Zanu-PF provincial members with no generous supply of food and drink, ensured that the event was in tune with the prevailing difficult situation Zimbabweans across the country find themselves in.

Said the President:

“We thought rather belatedly that the year, which was so challenging, with quite a number of outstanding events which included a visit by the President of China (Xi Jinping) and also lastly the National People’s Conference that we held in Victoria Falls, we concluded that all those events really must give us at least something, something we can say is a party that recognises that we have perfectly gone through the year and surmounted the challenges, many of them that faced us and others we continue to challenge.

“But a year like that needed to be celebrated, celebrated by us because of the resilience we showed. We succeeded in convincing our people to stand by us and accept these challenges as challenges to our nation together.

“So it was, we felt that a little reception at the end of December might perhaps wipe off our tears at the end and that encourages us, so we can face the New Year with new determination derived from the old. We thought well, a small thing be attended by a group of those who we would call the leaders of the country will do.

“That’s why you are here.”

The year started with indications that the agricultural season was going to be bad because of poor rains, particularly in the southern and western parts of the country. The drought affected tobacco output after a total of 186 million kg of the golden leaf worth $548 million was sold by the end of the marketing season compared to 204 million kg sold last year for $649 million. It also left an estimated 1,5 million people in need of urgent food aid. The government is importing food to feed the hungry. Development partners are playing a complementary role.

Industrial capacity utilisation averaged 34 percent this year, down from 36, 5 percent last year. This means that industry is still unhealthy, producing less goods and having to reduce manning levels. A number of employers are struggling to pay workers. This has seen some cutting salaries and allowances.

On July 17 the Supreme Court made an epochal ruling that cleared employers to dismiss workers on three months notice, and without benefits. As many as 25,000 workers lost their jobs between July 17 and August on the strength of the ruling.

The government took corrective action by amending the Labour Act to include provisions that accord some protection for the worker while giving employers the obligation to pay compensation of two weeks salary for every year served for all workers dismissed between the court judgment and the enactment of the law. Workers have hailed the law, but to many of them, the damage had already been done.

As the economic challenges persisted, the government this month failed to pay its workers on time. Teachers only got paid yesterday, about 10 days late, while other civil servants will receive their salaries on January 5. The government has pledged to pay its workers their bonuses but has not given a specific date when the money would be available.

It was not all gloom. We have seen a strong commitment by the government to create conditions for the economy to rebound. It is working to improve the ease of doing business so as to attract foreign direct investment from across the globe. The country has hosted delegations of potential investors not only from Asia and Africa, but also from Europe. Notable ones came from Nigeria, China, Britain, France and Germany.

Another big development was the government reaching an agreement with multilateral financial institutions for it to repay its debt next year. This was a welcome convergence of opinion between the government and the International Monetary Fund, World Bank and other global financiers expected to serve as a stimulus for greater investment, particularly from the West.

The year witnessed the mega deals signed last year beginning to materialise. Work started in January on expanding Kariba South Power Station. We expect more at thermal stations at Hwange, Harare, Bulawayo and Munyati. Tenders have been issued for harnessing of solar energy in Midlands and Matabeleland South.

We take the State visit by Chinese President, Xi Jinping early this month as a strong signal that the support Zimbabwe is getting from his country will bear more fruits going forward.

Yes, 2015 was a tough year, but we are happy that the government is working hard to build a strong foundation for the economic turnaround all of us expect in the next two years or so.

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