Key priority projects allocated $1,1 trillion

25 Nov, 2022 - 00:11 0 Views
Key priority projects allocated $1,1 trillion The Lake Gwayi-Shangani project will transform the fortunes of Matabeleland

The Herald

Nelson Gahadza Senior Business Reporter

Key infrastructure projects such as the Harare-Beitbridge highway upgrade and construction of Lake Gwayi-Shangani, have been allocated $1,1 trillion as the Government moves to accelerate their completion and drive sustainable economic growth and development.

Presenting the 2023 National Budget yesterday, Finance and Economic Development Minister, Professor Mthuli Ncube, said the allocation will prioritise on-going and stalled projects over new projects to ensure the sustainability of interventions under the difficult global and domestic financial conditions.

Unlike previously when most projects were funded from the Budget, this time the funding would be mobilised through a different funding mix.

The sources of funds include tax revenue $490,8 billion, loan financing $497,8 billion, development partner support $19,8 billion and statutory funds $134,4 billion.

According to the National Development Strategy 1, infrastructure development is critical for the attainment of Vision 2030 of an upper middle-income status.

Prof Ncube said the distribution of the infrastructure funding outlay under the various sectors will see energy getting the biggest chunk at $429 billion followed by transport and devolution $195 billion each and agriculture $63 billion.

He said the Government was concerned about malpractices in the costing of projects and programmes, where in some instances, companies have been overpricing, a development that has negatively affected macroeconomic fundamentals.

“The thrust by the Government is clear that all fiscal outlays on projects and programmes must, of necessity, add value to communities and thus, contribute to the overall economic growth and development of the country.

“In this regard, the Government will monitor every step of the project life cycle for all major infrastructure projects, to ensure that due process is followed, and where necessary, remedial action is taken,” he said.

Prof Ncube said institutions undertaking projects and managing infrastructure assets will be required to strengthen their operations and maintenance programmes. “In order to achieve the set targets and ensure that citizens benefit from investments made, implementing agencies should concurrently develop monitoring and evaluation frameworks for their targeted projects including integrating the monitoring and evaluation issues before project execution,” he said.

Of the overall support towards the transport sector next year amounting to $194,8 billion, a massive $177,4 billion is earmarked for roads, with $13,4 billion and $4 billion being channelled towards rehabilitation and upgrading of airports and rail systems.

“In this regard, support has mainly been targeted at the upgrading of the Harare-Masvingo-Beitbridge road and rehabilitation of other trunk roads linking border posts and major centres as well as those being implemented under the Emergency Road Rehabilitation Programme II,” said Prof Ncube.

Lack of routine maintenance for extended periods has invariably led to the deterioration of the road network, which is a cost to the economy in the form of long travelling hours, high vehicle operating costs and road carnage.

Admittedly, due to underperformance of the rail sector, heavy vehicles now transport more than 90 percent of cargo in and out of Zimbabwe thus, putting pressure on the road network resulting in damages, as well as causing congestion.

“Going forward, policy measures are being pursued to ensure road authorities adequately maintain the network, including recently upgraded and rehabilitated road assets by leveraging resources being mobilised through the Road Fund,” said Prof Ncube.

In the absence of external support, the Government will continue to use domestic resources to construct and rehabilitate roads.

To make meaningful progress, this will require concerted efforts for domestic resource mobilisation to support the desired economic transformation.

Prof Ncube said implementation of the targeted works on the Harare-Beitbridge highway was progressing well, with 355km having been opened to traffic while the remaining section was targeted for completion next year.

To ensure completion of the entire Harare-Beitbridge highway by next year, $43 billion has been set aside for the project.

Economist Professor Gift Mugano, who has been vocal about the need to use alternative funding sources other than the Budget, said the various Government funding options would be buttressed by the US$100 million bond that would be floated.

“This will provide long-term financing that is required for infrastructure projects,” he said.

The Government’s focus has also been on dam construction, rehabilitation and upgrading of water supply schemes, as well as borehole drilling and rehabilitation.

In 2023, the Government will upscale investment in water infrastructure and a budget of $30,4 billion has been availed to improve service access by communities as well as open opportunities in other sectors such as energy, agriculture, manufacturing, tourism and industry, that will positively drive the country’s economic transformation.

“While priority will be accorded to key interventions that will mitigate the effects of climate change to ensure adaptation and resilience, the 2023 Budget will specifically focus on key intervention areas such as sustaining ongoing dam construction projects, supporting the development of a master plan for all dams, implementing a clear programme to progressively utilise capacity of already existing water bodies for industrial and domestic and irrigation purposes,” he said.

In addition, said Prof Ncube, an amount of $11,4 billion was expended on Lake Gwayi-Shangani, which is now 69 percent complete and scheduled for completion next year.

Construction of Lake Gwayi-Shangani is being prioritised as its completion would be a significant milestone in the implementation of the National Matabeleland Zambezi Water Project which was first conceived in 1912.

Upon completion, Lake Gwayi-Shangani will significantly address the water situation in Matabeleland North and the City of Bulawayo.

“In this regard, an amount of $6,3 billion is being proposed to sustain ongoing works and ensure completion of the project during 2023,” said Prof Ncube.

The Government will also facilitate ongoing works at other dam construction projects such as Kunzvi, Tuli-Manyange, Semwa, Ziminya and Vungu, with an overall allocation of $15,4 billion.

An amount of $42,5 billion has been set aside towards development of irrigation infrastructure, fisheries and water conveyancing systems, among other interventions, as the Second Republic led by President Mnangagwa moves to ensure food security while at the same time ensuring nutrition.

Development analyst Mr Clemence Machadu said the Government’s continued commitment to infrastructural development is going to help strengthen the foundations of economic growth.

“These infrastructural projects contribute to reducing the cost of doing business in Zimbabwe and also enhance competitiveness, efficiency and timeliness in the production of goods and services; and aid in promoting and attracting investment into the country,” he said.

The road infrastructure would contribute to sustainable economic growth as it connects the country’s supply chains while allowing for merchandise to be moved efficiently within and across borders.

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