A summary of the Finance Minister's State of the Economy address for your reading pleasure. #HappyFriday
Firstly, let's understand that we live in an intertwined global spider web which exposes us to colds and flus whenever a significant member of the global community sneezes.
Thus, we're not spared from the effects of the Russia-Ukraine crisis for example, particularly, the disruption in oil supplies which has pushed global oil prices up
The damage changing international oil prices can do to growth prospects of small economies like ours are not new. The 1972 global oil price shocks bear witness to this
On the bright side, Copper prices have remained high, around US$10,725 per mt. Depending on our production levels and OTHER factors, we stand to benefit.
GDP numbers for Q1 of 2022 not presented (these normally come a quarter late) so we cannot tell if the economy grew. However, there has been tangible recovery with the economy growing from -2.8% in 2020 to 3.6% in 2021. Good job!
Budget performance was positive for Q1, with total revenues and grants amounting to K23.8 billion against a projection of K23.4 billion, representing a 1.5%. Good job!
Expenditure performance was within what was targeted. Put another way, we evidently spent as planned. Different from a few years back. Good signs of fiscal discipline which assures restoration of fiscal fitness. Good job!
Debt performance: Q1 external debt numbers are not ready but will be published later says the report. However, stock of Govt securities rose by 4.3%. We're still borrowing from the local market, obviously crowding out private sector.
Debt restructuring: discussions are on-going with creditors and Govt remains optimistic we will get the IMF package by mid year.
8th National Development Plan: the plan will be finalised. It will be launched by the head of state once approved by parliament. I personally could've loved to see a stocktaking of what we did with the 7NDP.
Measures to enhance the economy:
Three sectors have been highlighted: agriculture, tourism and mining. For mining it is expansion of existing ones and starting new ones. It could have been good to hear about value addition plans in mining
Three sectors have been highlighted: agriculture, tourism and mining. For mining it is expansion of existing ones and starting new ones. It could have been good to hear about value addition plans in mining
Govt has approved the Lusaka-Ndola dual-carriage way to be developed as a PPP, cheaper than earlier approach. Other pipeline PPPs are the Kazungula-Sesheke Road, the Maamba-Batoka Road, the Chingola-Kasumbalesa Road and the Mufulira-Mukambo Road.
The Minister concluded that best way to utilise limited resources is spend on the least poor. There won't be fuel subsidies as a result. But free education will continue to benefit the least poor. I agree. But we need resilience to survive immediate impact of rising fuel prices
most poor*
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