Treasury forecasts $80m lockdown loss

Tendai Mugabe Senior Reporter

Government will incur an estimated loss of $80 million during the 21-day lockdown, but is not worried about the cost as its focus is on rescuing citizens who have lost production time, Finance and Economic Development Minister Professor Mthuli Ncube has said.

The lockdown enters day four and people in the informal sector are not going to work as Government implements the lockdown, which seeks to curb the spread of Covid-19.

Fielding questions from the media during a post-Cabinet meeting in Harare on Tuesday, Prof Ncube said a rescue package  was a priority.

“Right now we worry about how we are going to use what we collect,” he said. “That’s is the issue.

“Our initial estimate is $80 million (loss), but we are not concerned about that.

“We are concerned about how we use whatever we collect to rescue our citizens through cash transfers — the SMEs and the funding that we are crafting towards the Ministry of Health and other ministries to support the fund against coronavirus.”

Some of the loss that the Government will incur emanates from the transactional charges that would be paid to mobile networks and banks to ensure that people got full value of the rescue package.

The data of the beneficiaries of the rescue package is with the Department of Social Welfare, but would be updated to cater for new beneficiaries.

Turning to the use of free funds for local transactions, Prof Ncube said there was no policy shift.

“On the use of US dollar, we are very clear that this is the use of free funds in your pockets,” said Prof Ncube.

“We are saying feel free to use those free funds in the shops as well. What that does is that it gives you the flexibility that is so desired given this tough episode where we have cash shortages and that is relief again, it’s not a policy shift.”