PRIVATE SECTOR NEEDS BOOST - EAZ

...especially in industries that have since independence been underutilized

ZAMBIA urgently needs private sector led productivity boost, especially with the economic hurdles the country is facing ranging from a weakening currency, spiralling inflation and Covid-19 related factors.

The growth needs an adrenaline boost in the private sector especially in industries that have since independence been underutilized, says Economics Association of Zambia (EAZ) National Secretary, Mutisunge Zulu.

Mr Zulu in an interview stressed that Zambia’s growth momentum would be highly dependent on the extent the private sector played their role.

He however quickly indicated that this was only possible if policy makers were able to sit around a table to understand the challenges faced by the private sector.

“We have the infrastructure and resources but struggle with implementation and mindset to drive radical shift in building capacity and that’s the reason our currency has been prone to external shocks.

“Boosting manufacturing will address foreign exchange earning capacity and increase tax revenues for the state and will help build reserves which have been a head ached for the central bank for the last decade,” he said.

Mr Zulu regretted that economic growth for Zambia currently entailed higher imports which required dollar funding.

He observed that because of the mismatch in dollar supply versus demand, the exchange rate was bearing the brunt through dollar shortages that are leading to supply chain disruptions manifesting in shortages as observed in the petroleum sector.

Mr Zulu observed that the Economic Recovery Plan (ERP) was a good document to the extent that operationalisation of the commitments was tied to specific deliverables across the energy, mining, agriculture and manufacturing sectors.

Agriculture programmes, he said, were good for food security.

He however mentioned that but if fertiliser importation would pressure the currency every fourth quarter of the year to first quarter of the following year, then there were structural issues to address such as how to start manufacturing fertiliser locally.

“Doing so would absorb some of the Agriculture related pressures in the foreign exchange market,” Mr Zulu said.