Ministry of Finance Permanent Secretary Felix Nkulukusa has dismissed fears that increased domestic borrowing by the government will limit the growth of the private sector in the country.Mr. Nkulukusa said the K13 billion domestic borrowing threshold will enable government to borrow within the law as opposed to the current status where domestic borrowing as of December last year reached K17 billion.
Mr. Nkulukusa said the legislation to increase the country’s domestic borrowing threshold has long been in existence and that what government has done is to merely legalize the threshold which was formulated by the previous Movement for Multiparty Democracy (MMD) government.
He said it is for this reason that fears that increased domestic borrowing will affect the private sector do not arise considering the fact that government borrowed beyond K13 billion last year.
The Private Sector Development Association (PSDA) expressed concern that the country’s increased domestic borrowing from 200 million kwacha to 13 billion kwacha will limit the growth of the private sector as banks in the country will be more motivated to lend to the government than the private sector.
The Ministry of Finance permanent Secretary was speaking in a telephone interview with Qfm news.