Stabilization of the Kwacha at K9 per dollar is more to do with the sharp shrinking of the economy than the Bank of Zambia monetary and currency policy interventions. Zambia’s Gross Domestic Product (GDP) shrunk by about US$9 billion in three years from US$28.05 billion in 2013 to US$19.55 billion in 2016. It is projected to even shrink further to US$17 billion in 2017 due to diminishing economic opportunities and the recently declared state of threatened emergency.
Business opportunities, especially for SMEs have sharply diminished. Disposal income for workers is sharply diminishing by the day. This is clearly evident from empty banking halls, traditional shopping centres and poor patronage in clubs, bars and restaurants. Workers are now foregoing decent lunch for nsolo and groundnuts.
As the Green Party, we are extremely alarmed by this development. At this rate, Zambia will soon get into a default mode for external debt repayments, just like is the case with the domestic debt.
We appeal to Government consider abandoning this monster called “state of threatened emergency” because it will worsen the already bad state of the economy. Not long from now, the economy will surely slip into gone into Intensive Care Unit (ICU) mode.
Further, the Minister of Finance should consider abandoning the so-called “Zambia-Plus” economic model because the model is proving more of rhetoric and a misadventure. It has failed to kick-start an iota of economic opportunities and activities almost one year on.