The newly inaugurated president of Zambia Hakainde Hichilema has promised the country with 10% growth per year during his five-year term in power as discussions with the International Monetary Fund (IMF) over provision of financial support continue.
A lot needs to be done when it comes to the Zambian economy particularly the inflation rate, debt situation, investment policies and the likes.
According to the consultant manager of Bridges Limited Chibamba Kanyama, Zambia has the right environment for investment opportunities especially to foreign investors as political risks have been reduced.
“So, the first thing is to assure everybody that the environment is good, including the foreign investors, that the environment is good is right for investment in Zambia. So politically, the risks have been reduced and that is the first focus of this new government.
“The second thing is to spell out the new course of action in terms of achieving macroeconomic stability. They need a change, of course, a policy realignment, practical actions by the government to induce sustainable growth, bringing self-sustainability in terms of debt,” Kanyama said.
Change in initiatives that act as a way to attain macroeconomic stability, sustainable growth, self-sustainability in terms of debt within the country include policy realignment as well as practical actions that need to be taken by the government.
Kanyama also highlighted that the current government is continuing with a discussion about allowing clear taxes without double taxation that was agreed on in May but was not yet made into a policy.
“The first action which began with the previous regime and this is hard to avoid ambiguities in taxation. Allow for clear taxes without double taxation so that the agreement was made except it was not yet put into policy.
“So this new government is taking over a discussion that was agreed in May awaiting consolidation, agreement on the policy, and a very, very sure that they will see the benefit of doing away with policies, fiscal policy that hindered investment in the mining sector,” he said.
During the previous government’s rule, political interferences, state policies and interest rates hindered potential investment as they were said to be unfavourable.
“The minister of finance has already indicated that within the next three, four years we should see the production level which comes from 850,000 metric tons per year to close to 2 million metric tons per year,” Kanyama added.
The consultant manager further reviewed that that the country is currently chocked up by high external debts and that debt servicing has narrowed space in terms government having extra cash to spend on social services.
It is said last year in 2020 Zambia was the only country in African that had its debt on default, but in this year the situation appeared to be on the point of fading away.
The country hopes to negotiate with multiple creditors on its alleged external debt of about $12 billion consisting of $3 billion in Eurobonds, $3.5 billion bilateral debt, $2.1 billion is owed to multilateral organisations, and $2.9 billion being owed to commercial banks.