Bank of Zambia (BoZ) Governor Caleb Fundanga says there is need for government to improve road infrastructure to realize the full business potential in Eastern province.
Dr. Fundanga said the deplorable state of most roads made it difficult for the transportation of goods and services within and out of the province.
“Some parts of the Great East road, Chipata-Lundazi and the Chipata-Mambwe roads are all in a bad state though they are supposed to provide a means of transport for agricultural produce, which is the main economic activity in at the province,” he said.
Dr. Fundanga was speaking at a business dinner that was organized by Eastern Province Chamber of Commerce at Pineview Guest House in Chipata yesterday.
Meanwhile, Dr. Fundanga has called on the business community to diversify their business in anticipation of trade growth that will be brought after the completion of the Mchinji railway line.
He stated that the railway would provide business opportunities in the clearance and forwarding sector among the three countries, Malawi, Mozambique and Zambia, in the growth triangle.
He urged them to rise to the opportunity of the growth triangle and engage in the gemstone mining and tourism sectors that have not been fully explored.
“There is potential which requires to be explored in tourism and gemstone mining and this can only be enhanced with improved road network,” he said.
He stated that though agriculture provided a good business platform for people in the province, there is need to diversify into other sectors especially now when the country is experiencing the effects of climate change.
“Floods have impacted negatively on the agriculture sector hence the need for you to rise to the challenge and diversify into other sectors such as gemstone mining and tourism,” he said.
At the same function, The Bank of Zambia (BOZ) says the country needs more export ventures in terms of products and markets.
He said with more export ventures Zambia’s economy will significantly grow.
Dr Fundanga told the EPCCI members led by the organisation chairman George Chambwera and other concerned individuals that this development would be enhanced through traditional exports.
He said in November 2007, Zambia’s non traditional exports had increased by 25.6 percent to US$845.1 million from US$672.7 million recorded in 2006.
The bank’s statististics indicate that tobacco and cotton contributed significantly to the non traditional exports figures in 2005 and 2006.
“The figures will be lower after farmers opted to plant maize given the lower prices offered for their tobacco and cotton products,” Dr Funfdanga said.
He urged the business community to diversify and explore market potentials in neighbouring Malawi and Mozambique where there is reported increased trade activities among the three nighbouring countries including Zambia.
The Central Bank Governor called for production of finished local products and services to add value to exports of non traditional exports to the neighbouring countries and beyond.
He urged the business community to consider using non cash transactions that would help financial players to keep track of the level of economic activities in the province.
He therefore asked commercial banks to design products and services whose cost structures would be sustainable to the region.
” Financial institutions in general need to offer structured financing that best suits the Zambian economic climate, ” he said.
And speaking earlier, Mr Chabwera said government was a very important business partner in the the economic develoipment of the nation.
Mr Chabwera said government has over the years played a key role in the economic developmernt of the country and this was seen by the appointment of one of Zambia’s key ecomomic player, Dr Caleb Fundanga as BOZ governor six years ago.
He noted that during Dr Fundanga’s reign as Central Bank governor the country has made major economic strides such as achieving a single digit inflation, among others.
And Mr Fundanga has said it was not the central bank’s plan to remove some zeros from the kwacha notes following Zambia’s achievement of a single digit inflation.
Speaking during a question and answere session with the business community, Dr Fundanga said it was not in his immidiate plans to remove some zeros as being rumoured in some quarters.
He said BOZ would only focus at achieving its mission statement of formulating and implimenting monetary and supervisory policies that will ensure price and financial system stability in the country.
On government’s recent increase on mine tax, Dr Fundanga said the move by President Mwanawasa was in correspondence to a popular call by stakeholders to increase mineral royalty tax.
He explained that the mining consessions enjoyed by new mine owners was because most mines operated at a loss at the time of privatisation but now this has changed as most of the mines had continued to record high profits annually, which was only well for government to revise the agreements.
Dr. Fundanga was invited to the region by ECCP to familiarize himself with the economic activities in the province.
