Minister for Finance Mthuli Ncube has delivered the 2021 National Budget which will be running under the recently launched economic recovery plan NDS1. The theme for the 2021 budget is “Building Resilience and Sustainable Economic Development”.
Here are some of the highlights from the document:
- Economy estimated to contract by -4.1% in 2020, reflecting weak demand due to necessary lockdown.
- This suppressed output, productivity and capacity utilisation.
- COVID-19 pandemic hit an economy already dealing with devastating impacts of climatic shocks of drought, Cyclone Idai and Cyclone Kenneth.
- Mining, manufacturing, tourism, construction, distribution and other service sectors faced the full negative impact of containment measures.
- Agriculture was less affected as the summer cropping season was almost over when the pandemic hit.
- Government reprioritised budget allocations and announced $18.2 billion Stimulus Package to save lives and livelihoods.
- Economy expected to rebound by 7.4% in 2021 from consecutive 2-year downturn.
- Government’s response aimed at ensuring strong economic recovery building on the milestones from the Transitional Stabilisation Programme (TSP) and targeting additional support measures to cushion vulnerable households.
- 150 000 formal jobs are expected to be recovered after having been lost due to COVID-19 pandemic.
- Prices are expected to remain stable as fiscal and monetary measures complement in containing inflation.
- Foreign Currency Auction market system is central in bringing stability to foreign exchange market.
- Year on year inflation is projected to reach 9% by the end of 2021.
The full highlights and Nation Budget documents are in the links below: