Zambia closer to $1.3bn IMF deal
ZAMBIA’S recent sharp economic activities and adjustments indicate that the country might be closer to getting the US$1.3 billion International Monetary Programme (IMF) deal, says Barclays Group head of Africa macro research Jeff Gable.
Discussions around the IMF supported programme are underway between Government and the Fund.
Mr Gable observed that recent economic adjustments and fundamentals indicated that Zambia’s outlook was up-beat, therefore getting ready for an IMF programme.
He was speaking recently at the bank’s economic breakfast meeting in Lusaka to discuss the current global eco-nomic trends.
“I have been coming to Zambia now for more than a decade but I would not say these discussions have been longer than that but certainly these discussions have been there for some time about the IMF for this country.
“Maybe we are closer to not just the agreement itself but also to the thoughts of adjustments that an agreement would imply and they suggest they would be right reasons,” he said.
Mr Gable said Zambia’s economic outlook remained upbeat despite tagging below the longterm average as it was being supported by the primary sector.
He indicated that Zambia’s interest rates in the market had been more comfortable, thereby providing an opportuni-ty for the private sector to be robust.
He said credit growth had started to recover and that interest rates were improving, becoming more comfortable than before.
Mr Gable also said the mining sector continued to grow faster than the overall economy this year with copper pric-es expected to boom.
“After economic growth slipping in 2015 barely more than two percent with agriculture sector shrinking significant-ly, at least as we sit now believe that 2018 is going to be better than 2017 and 2016 and 2019 maybe a little bit better again.
“People might be excited that copper prices are doing pretty well and the country itself is growing very rapidly and therefore looks like a sharper economic opportunity,” he said.
He, however, said Zambia’s trade balance remained under pressure despite copper prices improving.
Meanwhile, Barclays Bank Zambia managing director, Mizinga Melu, said her institution had continued to lower interest rates following developments in the financial market which had eased liquidity.
Ms Melu said Barcleys had continued to lend funds to the productive sectors such as agriculture and the Small and Medium Enterprises.
“It is very interesting that the central bank has continued to ease the monetary policy, inflation has continued to ease and statutory reserves have been at the lowest at 5 per cent, it is actually one of the lowest in the region.
“This simply means there is a lot of liquidity in the market for us as commercial banks to be able to lend to the productive sector. So as Barclays that is what we have continued to do to reduce our interest rates,” she said.