Bank of Zambia governor BOZ, Dr. Caleb Fundanga has assured Zambians that the country is on track in meeting the eight percent inflation target that government has set for end of this year.
Dr. Fundanga revealed that with the maize marketing just commencing, possibilities that Zambia will be able to meet the 8 percent inflation target are much alive.
The Bank governor indicated the bumper maize production that the nation has recorded this year is one of the most effective factors that would contribute to the attainment of the eight percent inflation rate target.
He said attaining low inflation rate should be encourage because it plays a critical role in national development and benefits everyone because of its cross cutting effects.
Dr Fundanga noted that he is hopeful that the rate will remain static at its current 9.1% till to the end of the year and at least drop to the eight percent as the year comes to a close.
He challenged Zambians to remain optimistic for a brighter future and a stronger economic status.
[ QFM ]
Better achievement, hope we sustain even the 9% and never two digit.
I will comment on this 6 months from now.
The only realistic step for government to take to curb inflation is to play a more central role in the economy. N.C.Z needs to be funded heavily so that it can provide the much needed fertilizer @ an affordable price to our farmers. Further manufacturing industry needs to be revived, government should not wait for investor’s to do this but rather they should create public sector units in partnership with private sectors. All the major developing countries like china,India and Brazil are using this strategy! Most of the strategic enterprises are controlled to a large extent by government. That is the only way to develop the economy and reduce inflation. NO FOREIGN INVESTOR WILL DEVELOP ZAMBIA, LET US KEEP THAT IN MIND!!!!
Mr Caleb, what of the fact that the kwacha seems to be devaluing every single day? 9 days ago the £ was selling at K7414 today it is K7711. Next week Friday this will be K8000. I can see the kwacha becoming the next zim dollar. As in two months time, at this rate, we will be buying a single £ for K10,000. So what are you talking about? I am lost.
Sometimes one wonders how these figures actually affect the majority of Zambians. Businesses and those fortunate enough to be in formal employment are protected from the ravages of inflation. But for the rest, there is no change. There is need for African economists to devise more relevant measures of economic performance which take into account the informal sector and the majority of Zambians who exist on the periphery of the formal economy.
#4 I think the Kwacha is too strong. It encourages consumerism and frustrates exporters. The number of luxury goods being brought into the country by Zambians cannot be good for the country. We need to encourage manufacturing and sourcing of local materials. The value of the Kwacha is bouyed up artificially by the mining sector.
So the big bursts and booms in Zambia are seasonal and are pegged to the sector that is in its infancy?
I like all the comments made above. But #3, don’t say “that is the ONLY way…” Because inflation is not the only principal in economic development.
I would like to know WHAT actions the government takes to implement fiscal policy. I would also like to know how BOZ executes it monitory policy. How do the two institutions interact synergistically to lower unemployment and inflation?
haha even the 8% targeted inflation is to high.THE govt should also try reducing interest rates so as a way to encourage investment which might in turn lead to some job effect and hopefullyt have a significant multiplier effect on the economy.
9.1% inflation rate sounds good but we want to see more happening in the economy. Supply-side shocks (especially NCZ) should be minimized. We also want to see an inflation rate that will be incorporated into contracts, pricing practices, and collective bargaining agreements. Furthermore with the bumper harvest acting as a short term supply side relief we want BOZ to adopt an inflation policy that is not harmful to long-run growth coming about as a result of high transaction costs and uncertainty about the future.