Cablegate: 2004 Budget: Quick Readout

This record is a partial extract of the original cable. The full text of the original cable is not available.

210823Z Nov 03

UNCLAS HARARE 002268

SIPDIS

STATE FOR AF/S
NSC FOR SENIOR AFRICA DIRECTOR JFRAZER
USDOC FOR 2037 DIEMOND
TREASURY FOR OREN WYCHE-SHAW
PASS USTR FLORIZELLE LISER
STATE PASS USAID FOR MARJORIE COPSON

E. O. 12958: N/A
TAGS: ECON EFIN EINV PGOV ZI
SUBJECT: 2004 budget: Quick Readout

Yesterday's 2004 budget announcement is more remarkable
for what it omits than includes. On almost every
significant issue - particularly devaluation and anti-
inflation measures - Finance Minister Herbert Murerwa
punts the ball to incoming Reserve Bank Governor Gideon
Gono, who will issue his own policy statement in mid-
December. Murerwa said the GOZ "will rigorously
implement fiscal and monetary stabilization measures,"
but did not spell any out in the 139-paragraph prepared
text. The GOZ did not even venture an inflation
projection, only that it would "dissipate . . . in
response to [unspoken] monetary and fiscal measures to be
implemented in 2004." Murerwa did forecast negative 2004
growth of 8.5 percent, down from 13.2 percent this year,
and raise the tax threshold to account for bracket creep
- a no-brainer given the current inflation rate. We will
provide a more detailed budget analysis next week.

Sullivan

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