By Staff Reporter
GOVERNMENT’S economic blueprint, Transitional Stabilisation Programme (TSP) missed its targets in terms of its intended objectives of steering the troubled country towards development, a local economic think tank said.
Speaking during a media roundtable discussion held in Mutare last week, Labour and Economic Development Research Institute (LIDREZ) economist Prosper Chitambara said there was no effective consultation and dialogue with key stakeholders to reach a consensus and achieve buy in.
Chitambara said one of the major reasons for policy failure was lack of effective participation among key stakeholders and citizens in policy formulation.
The TSP was launched on October 5, 2018 and is set to round off its tenure this December 2020.
The focal area of TSP includes stabilising the country’s macro economy and financial sector, introducing necessary policy, institutional reforms, to transform to private sector led economy and launching quick wins to stimulate growth.
Said Chitambara, “Development is not a top down approach but rather a bottom up approach. This is key to ensure that no one is left behind.”
He said TSP was based on shock therapy, a ‘big bang’ structural adjustment like approach which was not desirable for economies like that of Zimbabwe.
“Such an approach may, however, not be desirable for a country like Zimbabwe that has serious capacity constraints in a number of areas. Developmental welfare states adopt a sequential and gradualist approach that focus on attacking the most binding constraints simultaneously.
“Development success requires not a big bang approach but, rather, a selective, sequential, and often unorthodox approach that accounts for country specific circumstances,” said Chitambara.
TSP is underpinned by the vision ‘Towards an Upper Middle Class Country by 2030’, but Chitambara said attaining an upper middle class income status and attaining a pro poor, decent work, rich and sustainable development are not the same thing.
“In other words, attaining upper middle-income country status is necessary but not sufficient to ensure the attainment of pro poor, decent work rich and sustainable development,” he said.
The economist revealed the country can indeed attain upper middle-class income status by 2030 but without necessarily reducing poverty and creating full and productive employment opportunities.
“The growth experiences of a number of countries have shown that countries can actually attain stellar economic growth without creating jobs, a phenomena known as jobless growth or without reducing poverty,” said Chitambara.
The economist said while TSP has clear economic growth targets, there are no explicit targets on employment creation and poverty reduction.
“The TSP is therefore not based on a holistic approach to sustainable development that integrates economic, social and environmental imperatives and considerations.
“It is rather predicated on the underlying convectional macroeconomics assumptions of trickle down that once economic growth is attained that will automatically result in employment creation and poverty reduction,” he said.
Also given that future economic growth is projected to be underpinned by natural resources sectors in particular mining, he foresees less employment opportunities being created owing to high capital intensity.
“Such a projected growth pattern will also likely see many people being left behind and out of the growth dynamic,” said Chitambara.
According to LIDREZ, overall real Gross Domestic Product (GDP) growth targets for 2018 and 2019 were missed.
“In 2018, the economy only grew by 3, 4% against TSP target of 6.3 percent, while in 2019, the economy declined by -6, 5 percent against TSP target of 9 percent,” said Chitambara.
The target for 2020 will be missed with the World Bank projecting economic decline of -10 percent against the TSP target of 9.7 percent owing to Covid-19 pandemic among other factors.