The recently announced increase in the Monetary Policy Rate by the Bank of Zambia indicates that Zambia’s economic performance has continued to deteriorate on account of fiscal pressures limiting monetary policy interventions, a Trade and Policy Think Tank has said.

Bright Chizonde, a Researcher at the Center for Trade Policy and Development says Zambia’s inflation is expected to increase while exchange rate depreciation will further increase debt service payments with economic growth projected to showdown.

Mr. Chizonde said Zambians are therefore expected to continue facing hard economic times, with poverty levels escalating if fiscal corrective measures are not urgently implemented.

The Bank of Zambia last week raised the Monetary Policy Rate to 10.25 percentage from 9.75 percent in a bid to stabilize the deteriorating currency and support macroeconomic stability.

He noted that in the absence of corrective measures on the part of the Ministry of Finance, as indicated by the ever-widening fiscal deficit now at 7.6% of GDP instead of the targeted of 6.1%, which reflects higher than programmed spending on capital projects and debt servicing on external and domestic loans, Zambia continues to register reduced investor confidence and negative market sentiments.

Mr. Chizonde said this has increased pressure on monetary policy as indicated by an increase of yield rate on government securities.

“During the first quarter of 2019, Treasury bill yield rate increased to 22.6% from 21.4% due to negative market sentiments associated with Zambia’s sovereign credit rating downgrade in February 2019. Demand for government securities at auctions remained weak during the first quarter of 2019”, He said.

He has since recommended for urgent and effective implementation of fiscal adjustment measures in order to put fiscal deficits, debt levels and debt service payments on a sustainable path.

Mr. Chizonde said this is the only way to restore both domestic and international investor confidence adding that government should engage in extensive consultations with technocrats, private sector players, international Institutions such as the IMF and indeed local and international civil society organizations in order to find remedial and long-term solutions to the current economic situation.

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20 COMMENTS

  1. We are in trouble……….Mr. Bright Chizonde, are you not a technocrat yourself working aa a Researcher at the Center for Trade Policy and Development.
    Do not just talk and infiltrate fear in ordinary citzens, implement solutions as well!!!!!!!!!!!! We are getting fade up with educated fools who are in search of better jobs…………………

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    • @Musa
      Leave Mr Vizonde alone! What could the poor guy do when idyots, citizens, like you foolishly voted for a visionless president of a know party of thieves! You were told and warned about all this but you went on dancing to Dununa Reverse. The fact is that that the Real Dununa Reverse is here and you should just keep dancing to it for another 15 years.
      Fixing the economy is not like treating Kaswende where the pain stops when you take antibiotics! Economic misery will take 15 to 20 years to correct and by that time, you will have sold your house let alone having allowed your wife to do part time buchende to eke a living!
      Meanwhile, that old fossil Chikwanda that stole the money will be enjoying tuma wine twalekanalekana! Guys, dont just point fingers at Lungu as the thief; the…

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    • Solutions are only suggested to people who will listen. Lungu and his PF are advice proof and the first solution is to get rid of the PF.

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    • There is no point for “some of us” to read such articles did we not tell you in 2012 when you were running about with that boy silly Sampa listing EUROBONDS and then again for Chink loans? Today most of the money is going to debt servicing at the expense of health ad education. They are even closing universities to save money surely what form of creations are these?

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    • It is way past alarmist stage now…look again or are you also drinking senseless with your sugar mummy Aunty Maggie Dizzy?

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    • Kudos you are mentally ill if you spouse cheats on you today are you going to blame the devil so why should we blame this man and not PF

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  2. Look, do we really need to be told the obvious. it only follows that if you lack financial discipline and are prone to theft of public funds, one way or the other the citizens will have to pay for it. A country like zambia which has abundant natural resources is now failing to give its citizens basic needs of rights. A clear case study of mismanagement at the top level. The issue of corruption is inprinted in us at a very young age. When a zambian baby cries, it is not uncommon for the parents to induce that child by promising him or her a sweet or to threaten the child with lies that there is a ghost that will come for them, should they not stop crying. This upbringing is then taken up as a kid grows and the same kids become leaders who then go ahead to cheat the people that voted them…

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  3. It is like Chizondwe has just been woken up by PF to say the obvious which HH, Magande, Musokotwane, Saasa, and even the IMF have been telling the clueless PF monkeys to no avail!
    Running a country is not like dancing Dununa Reverse where you stop dancing when the music stops! It is too late now, the damage has been done and it will take 15 to 20 years to get the economy back on track even in the unlikely event that monkeys in the Lungu Administration put up proper economic measures today!
    There are consequences to recklessness in running the economy and people are reaping the consequences of voting for a visionless PF party let alone a visionless President, ati he is humble! Keep dancing, this is the real Dununa Reverse Live, courtesy of Gay man Jonathan Katembula from Edgar Kameno…

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    • Really laughable…Lazy Lungu can not lead even Goats in a village would rather have a Shepherd boy lead them to the drinking hole than Edgar…they know that he would sell them all for meat at the nearest Tavern.

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  4. It’s a crime to tell the truth in Zambia! Try to advise on reality and they will say you are unpatriotic!
    Only time will tell!
    Let the SH1T hit the ceiling fan first then we’ll all be in SH1T!

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  5. You are talking about suffering in the future when that suffering has already started and happening in the present. This article therefore has been overtaken by the exchange rate of K14 to $1.

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  6. Lungu fuc*ed all Zambians and today we are crying, WTF.
    Who did you vote for… Lungu,
    who did you support…. Lungu,
    who did you fight and kill for….. Lungu

    Dont cry now when YOU are keeping PF in power, stop complaining Zambia this is what you voted for so enjoy your life and suffer more

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    • Benzu Zulu..you must be one of the thieves in Lungu’s gang of thieves. Obviously the ramifications of Lungu’s visionless, clueless leadership doesn’t affect you. You unpatriotic foo1.

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