Kwacha stability more to do with shrunk economy than monetary and currency policy interventions – The Greens

35
638 views

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.

Peter Sinkamba
President
Green Party

35 COMMENTS

  1. +7
    -5
    vote

    “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.”

    1. I am now so happy that FNB and STANBIC introduced deposits on the ATM because their banking halls in the industrial area are always jam-packed, can Sinkamba tell me which bank has empty banking halls so I open an account today??
    2. It took me 30 minutes to buy milk in Shoprite yesterday because of queues, where does Sinkamba shop from???

    • vote

      3. I also need Sinkamba to show me which bars are not patronised because if you go to KCC Kabwata for example, you can’t even drink from there bcause you wont find a seat, people even drink from their cars these days, where is he talking about??
      IT SEEMS SINKAMBA IS SO NEGATIVE IT HURTS HIM WHEN OTHERS ARE DOING FINE. YOU WON’T GET VOTES BY SCARING YOUR VOTERS, PETER. ELYO, MU NASHEKO IBANGE YAMA!!!

    • +4
      0
      vote

      If you can be in line for 30 minutes just to buy milk, then there is problem. People do not waste that time in lines to purchase items. Is there only one store in Lusaka so that everybody shops there.

    • +1
      0
      vote

      Lmao,this guy ati Zambian citizen. You waste all that time to buy milk in shoprite coz its cheaper by about K2.00,all those pipo in the queues where there coz they can’t manage to spend any extra….,that shop is the cheapest and don’t forget the timing as well. You must have gone there after 17 coz most can only afford to buy for a meal at a time and not bulk buying.

  2. vote

    3. I also need Sinkamba to show me which bars are not patronised because if you go to KCC Kabwata for example, you can’t even drink from there because you wont find a seat, people even drink from their cars these days, where is he talking about??
    IT SEEMS SINKAMBA IS SO NEGATIVE IT HURTS HIM WHEN OTHERS ARE DOING FINE. YOU WON’T GET VOTES BY SCARING YOUR VOTERS, PETER. ELYO, MU NASHEKO I.B.A.NGE YAMA!!!

  3. +6
    -8
    vote

    It is very difficult to take Sinkamba serious on any matter. His entire constitution revolves on weed. One will wonder how much weed he has smoked before issuing any statement.

  4. +7
    -11
    vote

    Wait a minute and sit down ba Peter. Even a dull economist will educated you that the Zambian economy has been growing by an average 6% the past 5yrs, the last 2yrs Zambia has experienced the slowest growth, but growth non the less. To make it simple for you Zambian GDp has not shrunk buy grown.. If it had shrunk, we’d be in what we call a recession. Disapproving and trying to find negatives where they’re non only makes you lose the little respect and credibility you have.

    • +2
      0
      vote

      Iwe,what you saying is text book theory. On the ground its not the case,demand and supply plays a very crucial part not that story about GDP and slow growth for the past 2 years. Demand for goods is low,

    • vote

      True, the Zambian economy has not shrunk. It has however experienced a lower growth rate of about 3% per year for the last 3 years.

  5. +6
    0
    vote

    So what our “stoned” elder has failed to do in his article is to explain how a shrinking economy can be exhibiting factors that indicate rebounding performance…..the dollar rate is an indicate we cant ingore.. a low dollar rate against the kwacha to me is a stronger kwacha…..and reduction in mealie meal prices without government pronouncement…is a market response….

    What “hot-head” Peter is saying is that for you to quickly reach the furthest east point, you should head westwards….nonsense…
    Giving him a benefit of a doubt…Things are tough….could tougher or things could get better…for now tell-tell signs are positive…

  6. +3
    -1
    vote

    If the economy is shrinking, then the dollar must become expensive and rare. I receive money from relatives based abroad and I’ve not been told “sorry we have no money, come tomorrow “. Sinkamba is an environmentalist not an economic expert. Him and should not comment but just make hay while the sun shines.

  7. +1
    -2
    vote

    We lost some direction under Mr Alexander Chikwanda because he was still in 1964. Though it’s too early to say Mutati is turning things round I must point out that Felix served under the able leadership of Levy Mwanawasa and as commerce minister he worked very closely with our most outstanding finance ministers namely Ngandu Magande and Dr Musokotwane. Only dull person could have failed to learn from these prominent personalities.

  8. +1
    0
    vote

    Ba Sinkamba nabo.I wasted time reading the whole article thinking i will find some sensible analysis. Do you know that most transactions are being done online now and you can actually deposit at the ATM instead of queuing inside the bank?

  9. vote

    BaSinkamba pantu ifyamba ngafyabakola balafilwa ukwikalafye!
    Chibolyanomics iyi!
    Which Zambian economy shrunk? A simple click on the imf website would have saved him from all this diarrhea here on this good page.
    Iwe Sinkamba, uf the economy shrunk that much, Bank of Zambia would have to import a shredder to destroy truckloads of kwacha notes just to maintain a stable exchange rate with the dollar, never mind to actually make the kwacha stronger. Which economic theories are you being fed?

  10. vote

    Sinkamba too much fwaka,Boz has been mopping up excess liquidity to curb inflation hence the little appreciation

  11. +1
    0
    vote

    THIS IS THE ANALYSIS BY ONE WHO IS HIGH ON KA FWAKA.
    KA FWAKA KA LA BOMBA I CAN ASSURE YOU.
    THAT IS WHY THEIR PARTY IS CALLED THE GREEN

  12. +2
    0
    vote

    LETS GIVE CREDIT WHERE IT IS DUE. IT IS NOT A CRIME TO SAY THAT THE ECONOMY HAS SHOWN SIGNS OF REBOUNDING UNDER ECL AND MUTATI AT THE MOMENT. YES WE KNOW HOW UNSTABLE OUR ECONOMY CAN BE, MAYBE TOMORROW THE KWACHA MAY BE SOMETHING ELSE TO THE DOLLA. BUT FOR NOW LETS BE GLAD AND ENCOURAGE MUTATI AND ECL TO DO MORE TO MAKE THIS SITUATION EVEN BETTER. AFTER ALL THERE IS NO OTHER PLACE UNDER THE SON WHICH WE CAN CALL HOME. ZAMBIA IS OUR HOME. WHETHER IT IS STINKING OR NOT, IT IS OUR HOME. AND LETS HAVE GOOD WILL FOR OUR NATION. STAND AND SING OF ZAMBIA VERY PROUDLY AND FREE.

    • vote

      Our economy has never been unstable. Actually it has always been very stable even when there was a World recession, Zambia was not affected. This is not to say that our economy has always been good no.

  13. vote

    Simple supply and demand. If you look at the price of copper per pound last five years and the Zambian Kwacha the last 5 years, you will notice an inverse relationship. When copper prices increase, there’s more foreign currency in the system, resulting in a stable Kwacha. Copper prices started stabilizing mid 2016 and saw an increase late 2016 into 2017. The Green Party should fire the author of this article for incompetence.

  14. +1
    -2
    vote

    Currency stability is good news and a positive economic indicator. We get the propaganda of irresponsible opposition; if it’s good news put a negative spin on it.

    Citizens are tired of constant politicking by opposition and a One Party State model should be part of reintroducing law and order in Zambia. We need strong gov’t and stupendous Legal enforcers in place. As we tighten our belts we need to also work in harmony.

  15. +1
    -1
    vote

    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.
    What kind of economics is that?. If that were to be the case Zimbabwe would have had a very strong Zimdollar since its economy has shrunk and shrunk and shrunk

  16. vote

    I know that Green Sinkamba has not reached Donkey levels yet, you have to have a totally damaged and useless brain to reach that level. His problem so far is still the green fwaka syndrome.

  17. +1
    0
    vote

    Where are those United Dunderheads wanka like lilo, bucket brains, skeleton brains and co who where predicting that the Kwacha would drop to over 100 to the USD??? We told them our currency would withstand the global economic slump, we predicted a stronger result but still it improved from K15 at one point to its current 9 which is an excellent result. I predicted it would drop to K6 however a variance of K3 is still an excellent prediction at a time when the sa.tanic United Dunderhead doomsayers were praying it would freefall! God is Great Amen!!!

  18. vote

    Typical of cannabis smokers they raise issues in an inverted manner. You cant have a party whose ideology is based on Cannabis cultivation and smoking.

  19. vote

    Sinkamba’s Cannabisonomics.

    Nice serious title but rubbish analysis, its basis and structure. Sobber-up and revisit without a joint.
    Sinkamba must envious of the current PF economic successes in the region. Zambia is doing fine economically and in the absence of HH, probably the Catholic Fathers have better understanding on this important issue from their continuous economic monthly reports.

LEAVE A REPLY

Please enter your comment!
Please enter your name here