In as far as economic management is concerned, it cannot be denied that the current Government has performed to the highest expectations.Within a period of seven months, Zambia’s inflation rate has reverted to single digit.
In fact for much of 2006, Zambia had maintained single digit inflation until inflation levels broke into the double digit brackets in February this year. Lending rates have been at one of their lowest ebb for a long time and the Kwacha has stabilised to the extent where confidence in the currency has been restored. In addition, the Government has put into gear far-reaching investment incentives that have increased the country’s profile as an investment destination. This commendable performance by the Government has been acknowledged by even the International Monetary Fund (IMF).
The IMF has projected a rosy picture for the Zambian economy under which growth would be above six per cent and would be maintained for the medium term considerations. For such an intricate and highly sensitive phenomenon as an economy, which is susceptible to the most miniscule interventions from even non-strictly economic factors, this indeed constitutes no mean feat for the Government.
Zambia can realistically sustain the current high wave on which she is riding economically for the seeable future. All the positive showing that the economy has registered so far, aside from the Government’s creation of a conducive atmosphere, has been through the participation and support of all players in the economy. This is crucial, especially now that Zambia’s growth should easily surpass the current levels.The input and effort of each and every player, regardless of their positioning in the economy, their activities and line of business is important to the overall positive performance of the economy. Take agriculture for instance. As the inflation statistics revealed yesterday, non food inflation has played a big role in the overall reduction of the inflation rate for September. Going by the standard economic rule of supply and demand, it is obvious that the healthy supply position for food right now has had a huge knockdown effect on food price levels.
At the same time, the opposite is actually true. Abundant and relatively cheaper food supply is an important contributing factor to the lowering of inflation. Each season when Zambia has had to import maize to cover the deficit has turned out to be a difficult one for the price level and inflation has been difficulty to pin down. A concerted goal for agriculture in the 2007/2008 season therefore, should be increased production. The doubling of efforts will also be expected in other sectors including manufacturing, particularly for export.
The financial sector should also gird up to ensure that capital for growth in the various sectors of the economy is readily accessible.
Times of Zambia
