PMRC CALLS FOR EXPENDITURE ALIGNMENT UNDER AGRICULTURE
GOVERNMENT should quickly align spending in the agriculture industry to support key drivers of growth in the sec tor following the increase in essential commodity prices which will affect ex penditure performance.
This is according to the Policy Moni toring and Research Centre (PMRC) act ing Executive Director, Sydney Mwamba.
The expenditure should include ex pansion of exports in the horticulture in dustry, extension services, research and development, livestock management and production, disease control and ir rigation infrastructure.
Mr Mwamba observed that the in crease in essential commodity prices would affect expenditure performance, as the projected targets were likely to be exceeded for the remaining three quar ters of 2022.
“This scenario, coupled with the shrinking fiscal space would likely result in the Government taking a path of ex penditure rationalisation between meet ing its local and foreign debt obligations
and funding for economic and social sectors.
He said by directly constraining agri cultural production through increased fertiliser prices, limited economic activ ity and increased fuel prices, the conflict would further weaken the purchasing power of local populations, consequent ly leading to increases in food insecurity and malnutrition in Zambia.
This development, Mr Mwamba said, therefore called for multi-sectoral policy options to ensure that the country did not experience another recession as well as increased poverty levels countrywide.
He also urged Government to work around the clock to get the Internation al Monetary Fund (IMF) package and its accompanying debt restructuring pro gramme given the projected reduced economic growth and a further reduc tion in foreign financing.
Mr Mwamba stressed that the success of this programme and package would free up a significant amount of millions of dollars for foreign debt repayment.
He said this coupled with the in creased capital inflow from the US$1.4 billion IMF package would result in the appreciation of the Kwacha and allow for imports of required fertiliser and ma chinery for agricultural production and manufacturing sectors.
“Therefore the IMF and debt restruc turing program is essential to ensure that Government securities do not increase sharply from the current K201.16 billion as at end of March 2022,” Mr Mwamba said.