Fiscal deficit will reduce, says think-tank
ZAMBIA'S fiscal deficit for this year is expected to be moderated on account of improved revenue generation by the Zambia Revenue Authority (ZRA).
ZRA has so far collected over K59 billion this year, exceeding annual target for 2021 four months before close of the year.
Based on this revenue generation, Zambia's fiscal deficit is expected to moderate this year, according to the Centre for Trade Policy and Development (CTPD) Researcher Mataa Wakumelo.
"During the second half of this year, global economic growth prospects are expected to support the domestic growth closer to the 1.8 percent target growth of 2021.
"The country's fiscal deficit is also expected to be moderated to a certain extent based on the performance of the ZRA," Mr Wakumelo said yesterday in Lusaka during the launch of the CTPD Mid-Year State of the Economic Brief.
Fiscal deficit was expected to be higher than 9.3 percent of GDP envisaged in the 2021 national budget.
Mr Wakumelo indicated that increased public and investor confidence so far observed would potentially support a speed economic recovery.
He stated that CTPD expected reduced leakages to the domestic resource envelope in the second half of the year, banking on positive sentiments coming from Government to fight corruption.
"One thing we have observed from the new administration is this somewhat strengthened emphasis in terms of fighting corruption and other related illicit vices that drain us in terms of budget resources.
"So we expect that as these pronouncements are being implemented, there will be a reduction in leakages if domestic envelope coupled with performance from ZRA, we expect that we can do much better in terms of revenue generation getting into 2022," Mr Wakumelo.
He however stressed that all this was dependant on how policies and programmes would be aligned.
CTPD Board Chairperson, Isaac Mundia, said the aim of the paper was to help the nation keep track and reflect on the work collectively involved in trying to build a better economy.
Mr Mundia said the think tank hopes the paper will go a long way to steer public conservation and debate on the state of the economy.
"I must be quick to mention that the days ahead will not be easy ,there will be need to work extra hard in rebuilding our country ,there will be need for collective effort from all key players in the country and no one should be left behind, “he said.