Govt avails over $1 billion for Covid-19 response
Harare (New Ziana) – Government has been able to meet increased funding requirements brought on by the Covid-19 pandemic by utilising budget surpluses carried over from last year, a Cabinet Minister has said.
Unlike other countries, Zimbabwe has been denied access to Covid-19 emergency funding being availed by institutions such as the International Monetary Fund and the World Bank.
As such, it has had to rely on public and private domestic resources, while foreign financial and material aid from countries including China, the United Arab Emirates and Japan has also been received.
In the absence of emergency bailouts from Internationals Financial Institutions, which other countries are getting, Zimbabwe’s Covid-19
response was made even harder.
But despite the odds, the country has held its own, even unveiling an $18 billion economic stimulus and rescue package to keep the economy running.
Finance and Economic Development Minister Professor Mthuli Ncube said months of sustained fiscal discipline which resulted in budget surpluses had helped the government to readily avail Covid-19 funding.
He said government expenditure in response to Covid-19 had exceeded $1.2 billion as of 31st of May.
The Ministry of Health and Child Care, he said, had received the highest disbursement of $640.2 million as the frontline ministry in the Covid-19 fight, while the Ministry of Higher and Tertiary Education had received $44 million for the production of personal protective equipment and hand sanitiser by local universities.
The Ministry of Labour and Social Welfare, which is providing cushioning allowances to vulnerable members of society affected by the Covid-19 lockdown, had received $144.5 million while the Zimbabwe Republic Police which is enforcing lockdown regulations has received $37 million.
“Support was primarily directed towards procurement of PPE’s and that is why you see health has received the bulk of the financial releases. We have also provided funding for screening equipment, testing equipment and to capacitate isolation centres, the idea was to strengthen health intervention efforts and enforcement of the lockdown restrictions,” he said.
“Financial resources were also extended to institutions of higher learning for the production of PPE and sanitisers as well. Disbursements were also made towards social protection targeting at least 1 million vulnerable households affected by the lockdown, that is the target, we are not quite there yet we are pushing towards the target as we identify more vulnerable people. We are also targeting the homeless who have been placed in various shelters around the country and in quarantine centres. But basically the resources are within the Parliament approved 2020 national budget.”
He said although government expenditure had increased, it was still within the set budget.
Ncube said government could even afford to recruit an additional 4 000 nurses and 200 medical staff in March, increasing employment costs from $1.2 billion in February to an average of 1.7 billion per month in March and April.
“While there was an increase in expenditure, for some heads, overall spending was contained within the target as Ministries, departments and agencies re-directed spending within their approved budgets. Resultantly government recorded a surplus amounting to $77 million as of April,” he said.
Ncube said treasury was in the market to raise $1 billion for emergency Covid-19 funding.
“Obviously we are targeting banks, pension funds and so forth. We will raise additional funding through our borrowing programme. To date $500 million has been mobilised through treasury bills issued under the auction system and also private placement. Government is targeting to mobilise the outstanding $500 million from the insurance and pension funds.”
He said government funding had been complemented by domestic cash donations which stood at US$85 000 and $14.8 million in local currency.
Zimbabwe’s development partners had also chipped in with US$184.35 million.
Weighing in, Finance and Economic Development Permanent Secretary George Guvamatanga said; “We have actually managed to provide this funding without any access to the RBZ overdraft window or any funding support from the RBZ. We are very pleased that we have been able to achieve these increased funding requirements without recourse to inflationary funding methods.”
“The question will come, how have we achieved it? I think we have been able to achieve it because in the 2019 financial year we were able to carry over a surplus in real terms which then allowed us to be able to meet some of the increasing demand from Covdi-19,” he said.