One thing is certain. 2020 will see significant changes in how we conduct business and prepare for an almost uncertain future. I take comfort in the fact that the world has gone through these cycles time and time again. It is not the first time that things have changed nor will it be the last. If we understand this, we will not panic as individuals but prepare for the change that is already happening around us.
Zimbabwe is a rich country and is blessed with many abundant minerals, people and of course our good weather. Whilst the country has been hit by two success droughts it’s important to also note that the country has many dams which can be harnessed to grow irrigated crops. If any lesson is to be learnt from what is happening, it’s that people need food and without food there is no life.
With that backdrop, the Government of Zimbabwe launched a US$2,2 billion general appeal for humanitarian assistance from both domestic and international partners focussed on the following areas:
Food security: 7,7 million people in both urban and rural areas will require urgent food assistance.
Nutrition: Targeting a population of US$1,7 million people, US$14 million is required to assist those in need to better nutrition.
Social protection: US$20,8 million is required for a target of 1,7 million people.
Agriculture: Is the mainstay of the economy, however people need inputs and implements to produce for the nation. Government is appealing for US$672.3 million to assist in this regard.
Education: A population of 3,2 million people is in need of assistance in the education sector. The government estimates that US$75 million is required to assist the people.
In the Health Sector the Government is appealing for US$37,4 million to cover a targeted population of 12,2 million, while it is also looking for Covid-19 assistance amounting to US$220,4 million and US$34 million for Water, Sanitation and Hygiene (WASH).
It is also targeting to raise US$1,3 million for 128 270 people in need of shelter.
For Wildlife protection and management the government is appealing for US$61,4 million.
At the current interbank rate of 25:US$ this request amounts to over $55 billion, and is equivalent to 87,3 percent of the 2020 national budget estimated expenditure out-turn. Many will wonder why this appeal is necessary when people pay taxes such as the much talked about 2 percent tax on all transactions in the country. It’s clear that the country is facing significant challenges and as has been observed by many, requires urgent external support. This support can come in the form of grants or loans.
My advice to the government is to not only look at foreign resources but to give incentives to those that are able to invest or redirect their resources to areas in need. The easiest sector to revive at the moment is agriculture because there is unutilised land and food shortages. We can expect that there will be significant food demand in the coming months as nations try to make sure that their nations have enough food for their people.
The other important sector that requires immediate attention is the Health sector. Clearly a prosperous nation requires a healthy nation. The pandemic has shown that this sector requires urgent attention and enabling policies.
The fact that some hospitals and drug manufacturing companies that had been mothballed but are being successfully resuscitated shows that if there is deliberate effort in directing resources to where they are required our nation will build strong and reliable health delivery infrastructure.
How did we get here? One might ask? This has been the subject of many papers so i will not dwell too much on this point but wish to move on to how the country can quickly find ways of mobilising these much needed resources. Clearly it’s not an easy environment to be requesting for assistance or raising funding as the world is gripped by the global Covid-19 pandemic.
Countries with reserves are digging into their reserves to make the necessary intervention in their economies and this should serve as a good lesson for us as a nation to strengthen our own capacity to save and prepare for the unexpected such as droughts and pandemics such as the current Covid-19.
As a nation the pandemic could not have come at a worse time and the IMF estimates that the economy will face significantly bigger challenges as a result. I tend to agree but must hasten to add that all hope is not lost, if the country recognises the fact that it can harness its natural resources when the pandemic eases off and countries begin to stimulate their domestic economies.
The country must as much as possible continue to produce its exportable products and everything that is possible must be done to ensure that these products are ready to be exported into markets as they reopen.
As highlighted earlier up and down cycles happen every couple of years and we must all prepare for them. While it is not clear when or how the pandemic will end, the world has risen from similar situations in the past and the same will happen again.
It is also clear that the country needs a sovereign fund to prepare for catastrophes and diversify risk. The world is changing and we need to change with it fast. As I look ahead I see a stronger Zimbabwe that is focussed on creating sustainable livelihoods. Clearly the current challenges have been a wake up call to both the private and public sectors. The private sector will need to become more productive while the public sector will need to be more responsive and proactive to drive investment into the country.
New business models will emerge in 2020, which may involve remote work and the significant uptake of online services and electronic payment systems. Is your business ready for the change and are you ready to contribute to a better Zimbabwe. Until next week stay safe and do your part.