Monday, April 15, 2024

There is urgent need for Government to overturn Zambia’s current widening negative trade balance-Sinkamba

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Green Party leader Peter Sinkamba
Green Party leader Peter Sinkamba

Green Party President Peter Sinkamba says there is urgent need for Government to come up with tangible economic strategies to overturn Zambia’s current widening negative trade balance.

Briefing the press in Kitwe this morning on the state of the economy, Mr. Sinkamba attributed rapid depletion of the reserves to persistent trade deficit. He said that unless Government quickly introduces high-value export chains in the economy to overturn the persistent negative trade balance, the reserves could be exhausted complete as early as November, 2020.

“You heard from Bank of Zambia Governor Dr. Kalyalya two days ago saying Zambia’s foreign currency reserves have deteriorated to $1.63 billion as at end September 2018 from $1.83 billion of import cover at the end of June 2018. This means the reserves are being depleted at rate US$70 million per month. At this rate, we will have zero reserves in the next 24 months, and that could be disastrous for the nation,” Mr. Sinkamba said.

“The only way Zambia could avert the looming crisis is to introduce high-value chains in the economy. With current export arrangements, it is impossible to overturn the trade deficit.

“Zambia exports are expected to be K7, 590.11 million by the end of this quarter. Looking forward, we estimate exports to stand at K7, 623.88 in 12 months’ time. In the long-term, the Zambia Exports are projected to trend around K7, 623.86 Million in 2020, according to our econometric models.

“These export figures are worrying because of the negative trade imbalance. The last trade deficit was K1, 730.00 million. Before that, we had a trade deficit of around K828.00 million. This shows serious widening gap of trade deficit. We do not think that such a gap can be remedied by monetary policies but high-value export chains,” he said.

7 COMMENTS

  1. This is where you stand out unparalleled, because while simple minds are busy addressing non issues ,you on the other hand exert you energy and devote your time to matters vital to the nation. Yes,a way should as matter of urgency be found to increase the reserves. Can’t be over emphasized

    • SINKAMBA IS THE BFD FOR ZAMBIAN POLITICS AND ECONOMY.
      Man where can I get your bio. Just so you know if you keep breathing, you got my future votes post 2021. Just stick in there and I hope ganja won’t wipe you off the face of this world. After the infrastructure possesed PF Government We shall need figures based Govt.
      You’re smarter than some opposing faces. Don’t wrap up like the likes of outa favor Gen GM turned surrogate.

    • Hopefully Maggie pays attention to this advise. This balance of payments deficit means we are importing more goods, services and capital than we are exporting our copper and all. So Maggie may have to borrow more from China not for infrastructure but to pay for its imports going into shopping mall. These mall are really silos mopping up all the little forex

  2. The issue is where are these high valued export chains going to come from already? Things don’t just happen in a vacuum. It takes strategic planning and visionary ledeship, long term that is. Agriculture should be our focal point at this juncture, mining has proved time and again that it can not be relied upon. What are we Zambians doing apart from working for some corporation, mines, government. NGOs etc? Very few Zambians have engaged themselves into productive activities like agriculture, poultry, fish farming, piggeries, etc. This is were we should concentrate and rally for value addition and export to countries like DRC, Angola etc. We are blessed with plenty of land and abundant natural resources, our tourism industry is still in its infancy were there is real potential. Lets work…

  3. continued and talk less. Only then will we see real change. And this issue of the government removing herself from engaging in business has not helped at all. If you look at others countries, the government retains a significant % in mining companies and others so that they also get a chunk of the profits. We have decided to sell everything and only concentrate to getting taxes which is retrogressive.

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