In Zambia’s quest to restore fiscal fitness for sustained inclusive growth and development, President Edgar Lungu has affirmed that the time to act is now, adding that, “we will therefore, need to be bold and decisive.”
Reflecting on developments in the last decade in the forward of the recently disseminated Economic Stabilisation and Growth Programme 2017-2019, Zambia Plus, President Lungu observed that there has been turbulence in our development agenda, as a consequence of which, “this made it difficult to implement long-term policies for sustained economic stability and higher growth.”
Mr. Lungu said the mandate that the Zambian people have given his administration provides ample time to achieve set goals and objectives in stabilizing and growing the economy.
“The government is committed to the achievement of a fiscal balance as it is a critical step in getting the economy back towards a growth trajectory that is more sustainable and inclusive,” he said, further stating that, “the team work exhibited by all well-meaning Zambians in coming up with this home-grown programme is a true testimony of our commitment to restore fiscal fitness and stimulate sustainable economic growth and development, ” he said.
Mr. Lungu said the government would ensure that development reforms that could not previously be undertaken were also implemented.
“We are all agreed that the task of restoring stability and accelerating growth comes with its own challenges,” said the President, adding that, “turning the economy around and improving the lives of our people requires that we make hard choices and implement appropriate reforms.
“The time to act is now and we will therefore, need to be bold and decisive,” said President Lungu.
The economic environment in which the 2017 budget has been executed and the subsequent Government budgets will be implemented is expected to be challenging. This is on account of anticipated continuation of subdued growth in the global economy and domestic shocks which may constrain production and general economic activities.
“ This reality means that we have to act decisively to address the challenges we face in order to restore economic stability,” further guiding that, “only unity and hard work will help us overcome these challenges for shared prosperity.
“It is in this regard that Government has developed this Economic Stabilisation and Growth Programme (ESGP) for the period 2017 to 2019 dubbed Zambia Plus,” he said.
The ESGP is a home-grown programme and a product of wide consultations with various stakeholders. This Programme is a medium-term document that sets out concrete actions that are required to restore fiscal fitness, so as to reinvigorate the economy after a few years of sluggish growth. This is embodied in the theme of the document, “Restoring Fiscal Fitness for Sustained Inclusive Growth and Development”.
The document also serves as the Medium Term Expenditure Framework (MTEF) for the period 2017-2019. The ESGP which is an anchor to the Seventh National Development Plan (7NDP), 2017-2021, has five key pillars. These are:
1) Restoring credibility of the budget by minimising unplanned expenditures and halting the accumulation of arrears;
2) Enhancing domestic resource mobilisation and refocusing of public spending on core public sector mandates;
3) Improving our economic and fiscal governance by raising the levels of accountability and transparency in the allocation and use of public finances;
4) Ensuring greater economic stability, growth and job creation through policy consistency to raise confidence for sustained private sector investment; and,
5) Scaling-up Government’s social protection programmes to shield the most vulnerable in our society from negative effects of the programme.
The President has also observed that the successful attainment of the above pillars will require concerted efforts, and commitment of all stakeholders to shared prosperity.
“We are alive to the fact that the hard choices we are making have consequences, therefore, we commit to scale-up our social safety net programmes in order to mitigate the impact on the poor,” said Mr. Lungu, adding that, “the government’s commitment is that resources over the programme period are allocated to promote equitable development across the country.”
He emphasized that Cooperating Partners will play a significant role in complementing the implementation of Zambia Plus.
“I wish to re-echo that, the time to act is now, for sustained, inclusive growth and development,” he said.
In the foreword of the 2017-2019 Economic Stabilisation and Growth Programme, President Lungu listed the key success factors for the programme as:
1) Strong governance and political will;
2) Ensuring policy consistency;
3) Strict implementation of structural reforms;
4) Adherence to fiscal discipline; sustainable debt management; and,
5) Provision of quality and timely statistics.
And Mr. Mutai explains that the ESGP, 2017-2019, is Government’s response to the current economic challenges.
“ Given the scale of the challenges we are facing, we need a coordinated approach based on domestic solutions that will be supported by our cooperating partners. The focus of the Programme is restoring fiscal fitness for sustained inclusive growth and development. This will be done through curbing unproductive expenditure while raising domestically generated revenues, ‘ he said.
Monetary policy will be re-aligned to Government’s fiscal consolidation measures without compromising inflation and growth objectives. To unlock economic activity, Government will work towards dismantling arrears owed to suppliers of goods and services, as well as contractors, he said.
“ Government will at the same time ensure that the country remains within sustainable debt levels. Further, Government will pursue necessary structural reforms while implementing an effective social safety net to lessen the impact of stabilisation measures on the most vulnerable. These principles will be key to laying a foundation for the successful implementation of the Seventh National Development Plan (7NDP), 2017 – 2021, “ he added.
Consistent with the 7NDP, the ESGP puts particular emphasis on agriculture, tourism, energy, mining, as the basis for diversification. Access to markets, ICT and infrastructure development are emphasized as key growth enablers.
Meanwhile Mr. Mutati is expected to present the 2018 National Budget to Parliament on Friday, 29th September, 2017.
This is contained in a statement issued by Chileshe Kandeta, the ministry of finance senior public relations officer.