The opposition Citizens Coalition for Change (CCC) has just released its election manifesto, and its economic plan comes with a big bill.
The party plans to grow the economy to US$100 billion in less than a decade, raise US$10 billion to support businesses, and roll out a large-scale programme to fix Zimbabwe’s decayed infrastructure, which would cost up to US$34 billion over the next decade.
Apart from infrastructure spending and reviving businesses, the party also has an ambitious social plan, which includes free education and basic healthcare.
How does the CCC plan to raise this money? The party insists it has a plan for this. We take a look at its proposals.
Family jewels: CCC will use minerals as security
The party will use minerals as collateral to borrow money offshore.
CCC says: “Our government will securitise some of the country’s natural resources as a way of mobilising financing. Revenue surpluses generated from mineral resources will be directed towards infrastructure development, especially the construction of local roads and dams in areas that are not commercially attractive to private sector investors.”
The ZANU PF government has controversially done the same. Last year, Finance Minister Mthuli Ncube disclosed that the government had in 2006 borrowed US$200 million and used platinum reserves, held then by state-owned miner ZMDC, as collateral. This drew strong criticism from the opposition and mineral rights groups.
Akunwumi Adesina, head of the African Development Bank which is helping Zimbabwe to reach a debt deal with creditors, has advised governments against such loans, saying in June: “Loans backed by natural resources (oil, gas, minerals) are toxic. They are non-transparent, unfair, corruptible, complicate debt resolution, and mortgage the future of countries. Africa must end all natural resources-backed loans.”
Friends with benefits: CCC will raise money offshore
The CCC believes its reform plan will see Zimbabwe reach a debt relief deal quickly, allowing the country to borrow internationally.
“We expect to obtain massive funds from IFI’s upon resolution of Zimbabwe’s debt crisis in the form of grants and concessional borrowing,” the party says. There will be “various overseas grants on a transitional basis”, the party says.
However, debt relief may not be quick, as Zambia’s journey to a debt restructuring arrangement has proved. The CCC itself also says no debt deal must be agreed upon before a full audit has been done of all debts taken on by the ZANU PF government. The party also proposes international infrastructure bonds.
Cutting expenditure, tax reforms, ending corruption
The CCC believes it can raise money by fixing the budget, cutting spending, overhauling the tax regime and stopping illicit financial flows by fighting corruption.
The party proposes a single tax of 15%, which it says will improve tax revenue. The party will also stop “illegal exemptions for corporate elites”. The party has previously criticised exemptions to entities such as Great Dyke Investments, which got a five-year tax holiday in 2021 for its platinum project.
The CCC says, for roads, it will “set aside US$9.6 billion from the national budget, mobilise US$261 million from state enterprises, US$9.73 billion from local authorities, US$2.348 billion from donors and US$6.634 billion from the private sector through various instruments such as bonds and PPPs”.
To cut expenditure, the party would “rationalise” the civil service to cut employment costs to 30% of total expenditure. Currently, employment costs make up 52% of government spending.
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