Mashudu Netsianda, Senior Business Reporter
GOVERNMENT has set aside $500 million for youth empowerment and announced a tax incentive for companies that employ young professionals as it steps up efforts to generate jobs in the country.
Presenting the 2020 National Budget Statement in Parliament yesterday, Finance and Economic Development Minister Professor Mthuli Ncube said the $500 million fund would provide affordable loans to young entrepreneurs including those engaged in production.
“Treasury, through the 2020 budget is committing $500 million for this fund. This marks the launch of the ‘Presidential Youth Entrepreneurship Programme’ to drive entrepreneurship among the youth,” he said.
“Jobs are the foundation of any economy and high levels of unemployment depict the economy’s structural weakness, which invariably promote poverty, inequality and social problems.”
Prof Ncube also said fiscal incentives dubbed “Youth Employment Tax Incentive” (YETI), were being introduced to support employers who generate jobs for the youths.
“Any additional job created will attract a percentage tax credit to the employer. This measure will reduce the employers’ cost of hiring young people through a cost-sharing mechanism with Government,” he said.
“In recognition of this, the 2020 National Budget prioritises job creation, which relies on formal employment opportunities and entrepreneurship, and in particular the youth are targeted in as much as they make an important contribution as productive workers, entrepreneurs, consumers, and agents of change.
“Taking advantage of this demographic dividend can also speed up the pace for economic development.”
To operationalise YETI, Prof Ncube said the Ministry of Finance and Economic Development would work closely with the Zimbabwe Revenue Authority (Zimra), Ministry of Justice, Legal and Parliamentary Affairs and the Ministry of Public Service, Labour and Social Welfare, Employers’ Confederation of Zimbabwe (Emcoz) and other relevant organisations to work out the respective legal and administrative framework.
“In order to increase economic opportunities and participation by Zimbabwean Youth in national development, the National Venture Capital Fund will be capitalised in both local and foreign currency, to incorporate financing start-up projects of our youth with preference being given to targeted areas in the context of the Local Content Strategy,” said Prof Ncube.
He said Government would also continue to play its role in capitalising various institutions, which support women, youth and medium and small-scale enterprises (MSMEs) besides facilitating access to markets, workspace, trade promotion and capacity building, among other functions. — @mashnets.