Ministry of Finance and Economic Development

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The Ministry of Finance and Economic Development is a government organ which administers the country's fiscal and financial aspects through its respective departments. It has various organs administered by different personnel and these include among other the Reserve Bank of Zimbabwe and the Zimbabwe National Statistics Agency. The ministry is currently headed by Mthuli Ncube of the Zimbabwe African National Union Patriotic Front (ZANU PF) ruling party in the country.

Vision and Mission of the Ministry

Among other attributes, the Ministry of Finance in Zimbabwe endeavours to "be the centre of excellence in macro-economic policy formulation, coordination and stewardship of public resources to achieve sustainable socio-economic growth and development. To formulate and coordinate sound macroeconomic policies, effectively mobilise, allocate, manage and account for public resources."[1]

Background

The Ministry was carried over from the Ian Smith government in Rhodesia into the structures of the newly formed Zimbabwe African National Union which was headed by Robert Mugabe. The Ministry has been headed by various individuals since 1980. Below is a list of the respective ministers and the respective time periods.

Roles of the Ministry in Government

  • To manage the Consolidated Revenue Fund, the National Development Fund and the public debt portfolio;
  • Formulate and administer the National Accounting Policy;
  • Formulate and administer the National Budget;
  • Design and implement up to date and effective systems of internal check and control;
  • Mobilise financial resources to finance Government Programmes;
  • Facilitate and participate in the negotiations related to domestic and international mobilisation of resources;
  • Collect revenue due to Government, in particular through the Zimbabwe Revenue Authority (ZIMRA);
  • Analyse the performance of public enterprises and advise on matters of financial policy;
  • Carry out macro-economic reviews and recommend policies that promote macro-economic stability necessary for sustainable economic growth and development;
  • Give policy guidelines to the Reserve Bank of Zimbabwe;
  • Administer the National Economic Conduct Inspectorate;
  • Administer the Zimbabwe National Statistics Agency."[1]


Departments in the Ministry of Finance

  • Accounts General- This department under the Ministry of Finance handles the government accounting services; that is recording, documenting and tracing the national incomes and expenditure. It also includes the Consolidated Accounts. This department also helps in the administration of state parastatal accounts. Other Departments are as follows;
  • Budgets- It majors in expenditure and public its run the Public Sector Investment Programme
  • Finance and Taxation- This department manages domestic and international finance, revenue and tax policy.
  • Debt Management Office- Majors in resource mobilisation, risk management as well as financial settlements and disbursements.
  • Fiscal Policy and Advisory Services
  • Expenditure Department;
  • Revenue Department;
  • Domestic and International Finance;
  • Finance, Administration and Human Resources;
  • Implementation and Control of Expenditure Unit;
  • National Economic Conduct Inspectorate;
  • Zimbabwe Statistical Agency;
  • Internal Audit; and
  • Legal Services.[2]


Policies

STERP

In 2009, the Ministry of Finance under the leadership of Tendai Biti came up with a policy document which was called STERP (Short Term Economic Recovery Programme). STERP was "an emergency short term stabilisation programme, whose key goals are to stabilise the macro and micro-economy, recover the levels of savings, investment and growth, and lay the basis of a more transformative mid -term to long term economic programme that will turn Zimbabwe into a progressive developmental State." [3]

STERP 2

STERP 2 was a continuation and follow up policy to the initial STERP blueprint. "The short-term nature of STERP meant that some programmes and projects would not be fully implemented within the time frame of nine months. Hence, continuation of all such programmes beyond 2009 was implied from the onset in their design, resource requirements and implementation scope."[3]

Zimbabwe Staff Monitored programme

This was a programme initiated by the United Nation Economic Development organ which was meant to facilitate economic development

Zim Asset

The Zim Asset developmental policy was crafted in 2013 as part of the ZANU PF party campaign manifesto before the harmonised 2013 elections. The policy was eventually adopted by the government as a national policy in October 2013 after Robert Mugabe had won the controversial election. Patrick Chinamasa the minister of finance was responsible for campaigning in the cabinet for adoption of the document as national developmental initiative.


Criticism

The Ministry of Finance was accused of failing to manage the country's fiscal especially during the period of hyper-inflation from 2002 to 2009. During this period, the government introduced different notes as part of its policy to avert cash challenges faced by the banks. The then governor of the Reserve Bank of Zimbabwe Gideon Gono was accused of failing to bring lasting solutions to the challenges that were bedeviling the country. Zimbabwe at one point in time was the only country in the world where everyone was a millionaire due to the extreme hyper-inflation which had rocked the country. It was only in 2008 when the Ministry of Finance introduced a multi currency system but the impact of inflation had already affected all sectors of the country. However with the coming of the Government of National Unity in 2008, the Ministry of Finance under Tendai Biti managed o make commendable progress in areas of recapitalisation of government ministries, parastatals, local authorities and key institutions such as education and health ministries. In 2014, the Ministry of Finance through the Reserve Bank now headed by John Mangudya intoduced Bond Coins. This, according to the governor was meant to ease change problems since there was shortage of lower denominations of the Rand and the United States Dollar. However the move was criticised due to bad timing; critics argued that this was a very slow reactions since the problems of change started in 2007 when the US dollar began to infiltrate the local economy.


References

  1. 1.0 1.1 , Vision and Mission,Ministry of Finance, retrieved:24 Dec 2014"
  2. , Departments,Ministry of Finance, retrieved:24 Dec 2014"
  3. 3.0 3.1 , STERP,Ministry of Finance, retrieved:24 Dec 2014"