STATE OF THE NATION ADDRESS BY HIS EXCELLENCY THE PRESIDENT, CDE R.G. MUGABE, HOUSE OF ASSEMBLY, PARLIAMENT BUILDING, HARARE, 6TH DECEMBER 2005

Madame President of the Senate,

Mr. Speaker, Sir,

Senators,

Members of the House of Assembly,

Invited Guests,

Ladies and Gentlemen,

I present my State of the Nation Address today in the context, albeit at the end, of our Independence Silver Jubilee Celebrations.

Twenty-five years of Independence and Democracy are a significant milestone in the life of a Nation, which is why this year has been filled with a variety of commemorative events. Once again, congratulations Zimbabwe!

Key developments and achievements have added to the overall significance of the year. We successfully held Parliamentary elections in March this year, yielding the present House of Assembly. Through Constitutional Amendment No. 17, a bicameral legislative system was re­introduced with the Senate as the Upper Chamber and the House of Assembly as the Lower Chamber. The new constitutional dispensation necessitated another round of elections, which we held just over a week ago to fill the Upper House. As with the March Parliamentary elections, the senatorial elections were free, fair and peaceful. Through the President of the Senate, I congratulate all the senators, and in the same vein, remind them that while as their electors regard them as champions of their interests, they also view them as repositories of maturity, wisdom and experience. I have no doubt they will live up to that daunting expectation.

Madame President, Mr. Speaker Sir,

Constitutional Amendment No. 17 also gave finality to the process of land acquisition in respect of all resettlement land hitherto acquired by the State. Our settled farmers under both the A1 and A2 schemes can now go about their agricultural production business without the legally technical hitches that obstructed them in the past.

Madame President, Mr Speaker Sir,

During the past year, Government continued to implement the "Look East" policy. This effort received a boost from my State Visit to the People's Republic of China in July this year, and has been expanded by our ever-deepening relations with most countries in Asia and the Middle East. This region has stood by us in this our time of need and has created and offered new trade and investment opportunities. Already, a number of cooperation areas have been identified in mining and mineral processing, tobacco production and processing, water conservation, power generation, urban development, transport and communications. I wish to encourage the business community to seize the emerging opportunities by engaging and doing business with some players, that is, entrepreneurs, of the world's fastest growing economies.

Investment by the Industrial Development Corporation (IDC) saw the opening of two new factories in the Sunway City Industrial Park in Harare, one for animal and public health, and another for bleaching cotton and producing sanitary products for domestic and export markets. Both projects have incorporated expertise and inputs from the East, specifically from the People's Republic of China and Iran. Further, the IDC is implementing a multi-seed oil processing and feed­stock project in Chitungwiza, in partnership with Midex Overseas Limited of India. With a capacity to process 200 000 tonnes of soya beans and cotton seed per annum, the project is set to give a big boost to agricultural production.

The same policy is beginning to have a telling effect in mining where operations had been affected by poor prices and viability problems. Measures being taken include increased capacity utilization of industries. Already, the Zimbabwe Mining Development Corporation (ZMDC) has re-opened the Sabi Gold Mine in Zvishavane and Eureka Mine in Guruve.

Further, negotiations are currently underway with ZIMPLATS for the ZMDC to mine unutilized claims as well as other platinum claims on a joint venture basis with NORINCO Company of the Peoples Republic of China.Clearly Zimbabwe is very much looking East and there is no looking back!   

The performance of our economy experienced mixed fortunes this year. Starting on a promising note with the economy moving towards greater stability as inflation decelerated to 123 per cent in March from a peak of over 600 per cent the previous year, the trend suffered a reversal which has seen the inflation rise to the present figure of 400 per cent.

Government is concerned about the fast rising prices, especially of basic commodities and essential services, which are contributing significantly to the hyper-inflation. Regrettably, this is also immensely contributing to the rapid erosion of the people's standards of living. Government, however, continues to implement measures designed to turn around the economy so prices can stabilize in the context of a growing and expanding economy. A successful agricultural season this coming year will certainly have the effect of causing a decline of the inflationary trend.

Madame President, Mr Speaker Sir,

Indeed, the main thrust of the 2006 Budget presented last week is to reduce the high inflationary pressures that are currently threatening the socio-economic well-being of the people. In line with the economic turnaround strategy being pursued, Government is making concerted efforts to ensure more efficient use of the Nation's scarce resources. The recently adopted Results Based Budgeting requires all Government organs to account, through performance, for allocated resources in terms of agreed outputs and outcomes, as between Treasury and all implementing Ministries and Departments. The Results Based Budgeting will complement the Public Sector Financial Management System (PFMS) in reducing the budget deficit by encouraging fiscal discipline and re-prioritisation within Ministries.

Resuscitation of agriculture to ensure food security, generation of foreign currency, increased industrial productivity, infrastructure development and sustainable growth in energy supplies, remain the priorities of Government. A $1 trillion facility for inputs, targeting communal and A 1 farmers, is now in place and being disbursed through the Grain Marketing Board depot network.Financing for A2 farmers amounting to $7 trillion is also being disbursed through the Agricultural Sector Performance Enhancement Facility (ASPEF) at an interest rate of 20 per cent, to enable farmers to meet their needs for irrigation, horticulture, dairy farming, cropping and livestock rearing. I am also reliably informed that all the Nation's requirements for seed have now been met.

Madame President, Mr Speaker Sir,

Government recognises the impact of recurrent droughts, which have forced the country to divert scarce foreign exchange resources from production to financing food imports. To enhance agricultural production and meet national requirements of 1.8 million metric tonnes of cereals, targeted production has been introduced through OperationFood Security/Maguta/lnala by Government. The major objectives of the programme are to boost the country's food security and consolidate national strategic reserves. Further, Government's strategy to ensure food security and surplus for export is to have at least 300 000 hectares of maize put under irrigation. Rehabilitation of all irrigation schemes in Al and A2 areas is set to be complete this year and will thus greatly increase hectarage under irrigation by another 39 000 hectares.

The winter wheat season progressed satisfactorily despite an earlier menace of the quelea birds. A total of 270 000 metric tonnes of wheat are expected at our GMB depots this year. A shortfall of about 130 000 tonnes will be met through imports.

The tobacco season started rather slowly with the release of $150 billion for seedbed and land preparation. At present, available tobacco seedlings point to a crop of between 43 000 and 53 000 hectares. The irrigated crop is now established in some areas and it is anticipated that the dry-land crop will meet set targets.

Madame President, Mr Speaker Sir,

The full recovery of the livestock industry is of paramount  importance. Accordingly, during the past 12 months, Government availed a total of $2.06 trillion to support the industry through Agribank, the CSC Cattle Supply Scheme and the Agricultural Sector Performance Enhancement Facility. Continuous animal disease monitoring and control by Government ensures that minimised.

Madame President, Mr Speaker Sir,

Government is cognisant of the central role of exports in sustainable economic recovery. Hence, it has just concluded the National Export Strategy in close consultation with key stakeholders. The Strategy underpins the Industrial Development Policy that seeks to transform Zimbabwe from a producer and exporter of primary commodities to a major producer and exporter of competitively priced value-added goods. We have to inculcate an export culture based on value addition within the Zimbabwean enterprise.

Foreign currency leakages from mineral exports remain a major concern to Government. Consequently, tight monitoring measures of the whole mining sector have been put in place. Already, teams have been established in all mining districts to monitor this sector.

As part of efforts to promote tourism, the country hosted the 2005 International Travel Expo, attended by 166 international buyers, compared to 123 the previous year. Of this total, buyers from Asia increased by 61 per cent to 29,9 underlying the potential growth of tourism following implementation of the "Look East" policy. In addition, Government has gazetted tourism development zones this year and will encourage local, corporate and foreign investors to seize the opportunities created. These zones are Chiredzi, Gonarezhou and surroundings; Lake Mutirikwi and surroundings;and Beitbridge, Shashe-Limpopo surroundings .

Government is putting in place policy instruments such as the Empowerment Bill, National Empowerment Fund and the Empowerment Charter. The instruments seek to create a comprehensive institutional and ethical framework for indigenisation and empowerment programmes; facilitate financial assistance to further indigenise the economy, and forestall negative tendencies of the empowerment process that previously manifested themselves in the form of economic malpractices and corruption. Pursuant to the policy of indigenous empowerment, the small and medium scale enterprises sector is set to benefit from concessional funding which now stands at $7.9 billion.

The economic turnaround will undoubtedly benefit from our unity of purpose and goodwill between and among all sector players. In this regard, I want to applaud the resumption of the tripartite negotiations combining Government, Labour and Employers, trusting that they will meet more often and can begin to tackle challenges of the day in a spirit of trust and mutual empathy. There is no substitute for working together.

Madame President, Mr. Speaker Sir,

Considerable progress has been registered in the fight against the scourge of corruption and related economic crimes that have permeated all levels of our society. Of significance in this regard is the appointment of the nine member Anti­Corruption Commission to spearhead the anti-corruption crusade. It is expected that its joint efforts with the Zimbabwe Republic Police (ZRP), and all other security agencies, will significantly reduce corruption levels.

A well-developed road and rail network is essential for development. To improve the road network in the rural areas, ease congestion in urban areas and reduce accident rates in the trunk road system, $156, 6 billion was allocated in the current Budget to the Ministry of Transport and Communications. A Rural Capital Development Fund of $42 billion was allocated in the 2005 Budget to fund community-based infrastructural projects such as dams, access roads, dip tanks, water and sanitation programmes. To generally speed up the development of rural and urban physical infrastructure, Government launched the Infrastructure Development Bank of Zimbabwe (IDBZ) on 31^st August 2005.

Efforts by Government to provide decent accommodation to the people through the national housing programme received a major impetus following the implementation of the Operation GarikailHlalani Kuhle Programme. Government made a commitment of $1 trillion under phase I of the programme, in July 2005. The programme is expected to continue until the national housing backlog is significantly reduced.

In the power sector, the expanded rural electrification programme has completed 4 229 projects while 1 157 projects are at various stages of completion. The governments and people of China and India must be commended for their assistance through the provision of electrical equipment and operational vehicles.

Government is cognisant of the rising demand for electricity and fully supports all initiatives geared towards ensuring adequate power supplies to meet the country's requirements. To this end, efforts are underway to implement the Batoka power project jointly with Zambia. Government is also promoting programmes aimed at producing bio-diesel from jatropha, ethanol from sugar, and oil from coal.

In the communication sector, Net*One, managed to increase its rural base stations to thirty-five, while interventions were also made in the fixed network which saw the transmission link between Zimbabwe and Botswana replaced by digital radio. Plans are underway to upgrade the network to optic fibre. Furthermore, the Mazowe Earth Station was upgraded to boost the fixed service transmission. TelOne will also develop adequate microwave or equivalent capacity between Bulawayo and Harare to enable it carry all signals, including that for broadcasting. On the postal service side, significant progress has been made, especially in the expansion of the rural postal network. Apart from constructing twenty new rural post offices, Zimpost procured twenty additional mobile post offices in order to complement the on-going agrarian reform.

Madame President, Mr. Speaker Sir,

Government is concerned over the declining broadcast transmission capacity in the country. The number of communities living outside the reach of any signal from the national broadcaster continues to rise as a direct result of the rapid decline in transmission, partly related to ageing equipment and general under-investment in transmission. I want to pay tribute to the Iranian Government for helping us to complete the first phase of the digitalisation of Zimbabwe Broadcasting Holdings (ZBH). The second phase, which should cover all radio stations, outside broadcasting vans and studios in Bulawayo, should start next year.

In transport, provision of safe and reliable public transport to the commuting public is fundamental. In this regard, ZUPCO, through the $300 billion facility made available by the Reserve Bank of Zimbabwe combined with its own revenue acquired 135 new conventional buses and 41 minibuses, bringing the company's bus fleet to 394. This significantly improved public transport on both the urban and rural routes. As part of the re-capitalisation of the national airline, two MA60 aircraft were acquired from the People's Republic of China, bringing the Air Zimbabwe fleet to eight. Investing in the aircraft has presented opportunities for Air Zimbabwe to expand its domestic, regional and international route network. However, all these investments will come to naught if the airline is not underpinned by sound management and eradication of corrupt tendencies.

In the area of relief and welfare services, Government continues to support the welfare of its people by intensifying social protection mechanisms. To this end, $100 billion was allocated to this year's budget and an additional $150 billion as a supplementary budget to implement the drought relief programme. The Zimbabwe Millennium Development Goals (MDGs) Report was launched and presented to the United Nations at this year's Summit in September. Of the eight MDGs, Zimbabwe is prioritising Goal 1 (Eradicating Extreme Poverty and Hunger); Goal 3 (Promoting Gender Equality and Empowering Women); and Goal 6 (Combating HIV and AIDS, Malaria and Other Diseases).

As part of ongoing efforts to eradicate poverty, Government through the Ministry of Women Affairs, Gender and Community Development is implementing selected projects that are aimed at empowering communities to improve their livelihoods through food security and income generation. In this context, communities are being mobilized to grow new crops, such as cassava and pursue other agricultural activities as a way of contributing towards food security and poverty reduction programmes.

Despite the many challenges in the health sector, Government remains resolute in its drive to safeguard the health and quality of life of the population. Thus, Government remains gravely concerned with the escalating costs of health care. At the same time, the health demands have been intensified by the prevalence of the HIV and AIDS pandemic, malaria and other diseases continues to address this sector seriously. Government

Madame President, Mr Speaker Sir,

With a view to maintaining the high standard of education for which Zimbabwe is well renowned, Government will begin to implement the recommendations of the Nziramasanga Report. These include establishing at least one pre-school at every primary school; implementing the two path-way structure which channels students into technical/vocational, business, commercial and academic streams; phasing out hot sitting; and establishing permanent education infrastructure in newly resettled areas through the construction of new  schools and completion of outstanding structures.

In the expansion of higher and tertiary education system, a group of 14 pioneer students of Lupane State University started their lectures in September this year at NUST, where the university is temporarily housed. Meanwhile, construction of the university infrastructure is progressing well. To date, Government has established nine universities, all of which are national. Government remains committed to the general well being of its citizens by improving service delivery through technological advancement in line with global trends. To this end, Government has formulated a National Information and Communications (lCT) policy in consultation with various stakeholders. This Policy seeks to inter-alia integrate ICTs in Zimbabwe's development process and facilitate greater access to public information. In the process, this policy will complement the Presidential Computerisation Programme which by January will have benefited some 500 mainly rural secondary schools.

The Zimbabwe Defence Forces continued to implement various programmes, focusing on both the domestic and international arenas. Apart from participating in joint peacekeeping efforts, the defence forces also undertook activities that promoted the policy of Military Assistance to Civil Authorities. The defence forces played a key role in Operation GarikailHlalani Kuhle.

Madame President, Mr. Speaker Sir,

As 2005 draws to a close, a number of successes have been registered in the area of international relations. The just ended Afreximbank Annual General Meeting held in our country is a strong sign of returning confidence. This is a Bank that has stood by Zimbabwe throughout her difficult years.

At the sub-regional level Zimbabwe has continued to work closely with her SADC partners. This strong cooperation and solidarity has been demonstrated in the way SADC stood solidly behind Zimbabwe when our enemies sought to sow divisions within our ranks. It is Zimbabwe's commitment to SADC, which saw us, during our Silver Jubilee celebrations, honouring Frontline States leaders who contributed so much towards our liberation and to the formation of our sub­regional organisation. We recommit ourselves to work even more closely with our SADC partners as we express our gratitude to them as well as to the African Union for strongly supporting Zimbabwe against not only British but Anglo­Saxon imperialism, for Zimbabwe will never be a Colony again!

At the continental level, Zimbabwe shares the hope and resolve of the African Union to be fully represented in all decision-making organs of the United Nations, particularly in the Security Council, which is the principal decision-making organ of the UN in matters relating to international peace and security. To that end, Zimbabwe continues to champion the African position which in principle opposes the notion of veto power as undemocratic, but demands at least two permanent seats, with all the privileges of permanent membership, including the right of veto for as long as it lasts, as well as five non-permanent seats. We will play our full part in ensuring that Africa remains united in its quest for a meaningful reform of the UN and the Security Council.

In conclusion, Madame President, Mr Speaker Sir,

It is encouraging to note that Zimbabwe has made immense progress in the face of daunting challenges. We owe this to the unshakeable resolve of our people to shame our enemies and detractors and demonstrating that we are our own liberators. Let us go into the New Year with renewed vigour firstly to guarantee our Nation food self-sufficiency and a surplus for export, and secondly to work hard to grow our economy to commanding heights. We have the natural resources in abundance. Let our energies as indeed our virtues also be abundant and operate under the bond of UNITY!

I wish you a Merry Christmas and Prosperous New Year.

I thank you.