SPEND WITHIN BUD­GET, STATE WARNED

Daily Nation Newspaper - - KOPALA NEWS -

By BUUMBA CHIMBULU GOV­ERN­MENT must spend within the bud­get as not do­ing so may cause the In­ter­na­tional Mon­e­tary Fund (IMF) to lose con­fi­dence and not as­sist Zam­bia with the eco­nomic bailout. warns the Zam­bia In­sti­tute and Pol­icy Anal­y­sis (ZIPAR).

ZIPAR also says the weak­en­ing of the Kwacha would re­sult in ex­pen­sive im­ports.

ZIPAR re­search fel­low, Cae­sar Cheelo, ob­served that ne­go­ti­a­tions be­tween Gov­ern­ment and the IMF for an eco­nomic bailout had been tough which called for pru­dent use of re­sources to con­vince the fund as­sist the pro­gramme.

“There has been a chal­lenge in Zam­bia in that fis­cal dis­ci­pline has been dif­fi­cult to achieve in that peo­ple who would have been there to help you such as the IMF start to lose con­fi­dence. They start to think you are spend­ing a lit­tle bit reck­lessly be­cause you are spend­ing on things which were not planned in the bud­get,

“So as th­ese new debts start to ap­pear on your books, the IMF starts to ask wait a minute, where did this money you are spend­ing come from and if you can­not ex­plain your­self then they hold back their money,” he said.

Mr. Cheelo warned that un­til Gov­ern­ment fixed its ex­pen­di­ture to the level that the IMF was com­fort­able, the fund would con­tinue with the ne­go­ti­a­tions.

“I think there is some level of lim­ited in­for­ma­tion re­gard­ing what is go­ing to hap­pen with the IMF. I think the ne­go­ti­a­tion has been tough, you just need to read be­tween the lines to see that it has been tough,

“Af­ter the spring meet­ings (World Bank and IMF) of April 2017, the min­is­ter (Felix Mu­tati) as­sured the na­tion that in Au­gust when the IMF board sits, they will make a de­ci­sion, mean­ing that be­tween April and Au­gust, Gov­ern­ment was sup­posed to sub­mit a for­mal re­quest for the IMF sup­port.

Mean­while, Mr Cheelo said the in­creased ap­petite for the dol­lar had in­creased lead­ing to the Kwacha to lose.

Mr. Cheelo ex­plained that this de­vel­op­ment meant that it be­come a lit­tle more ex­pen­sive to im­port.

Fi­nance Min­is­ter Felix Mu­tati (l)

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