The International Monetary Fund (IMF) says Zambia ‘s revenue collection base is this year expected to exceed the 2011 budget projections due to increased taxes from the mining sector.
In its statement obtained by ZANIS today at the end of its staff mission’s visit in Zambia, the IMF observed that there will be an increased revenue from taxes from the mining sector.
The monetary fund explains in the statement that this is because there has been controversy over government’s refusal to introduce a windfall tax of the mining sector which is dependent on profits resulting from high mineral prices.
The IMF team observed that the performance of the Zambian economy continued to be good with real gross domestic product (GDP) growth in 2010 adjusted upwards to 7.6 per cent, boosted by the record maize harvest, a continued increase in copper and construction output and a rebound in tourism.
The team further observed that inflation declined in line with expectations in 2010, but has increased slightly since the beginning of 2011 (up to 9.0 per cent in February).
“Non-food price inflation remains in the low double digits. Net domestic financing of the government was 0.3 per cent of GDP higher than targeted at end-2010 primarily as a result of higher interest payments and additional expenditures on the census and voter registration.
” The balance of payments for 2010 experienced a record-high current account surplus of about US$600 million (3.8 per cent of GDP), with international reserves increasing to US$1.9 billion as of end-February 2011. Private sector credit has returned to pre-crisis levels in nominal terms, despite an increase in nonperforming loans and still high real lending rates,” the team reported.
The team led by George Tsibouris, said revenue collections were expected to exceed the projections in the 2011 budget, due in large part to increased taxes from the mining sector, which should provide room for additional infrastructure and pro-poor expenditures.
The team said drawing on the experience in 2010, the government will need to ensure that its maize marketing role does not hamper private sector incentives and minimizes budgetary costs.
ZANIS
Ba IMF tatulekana ama projections yenu, but it is accountability thats what matters
well done Dr Musokotwane. At least you have shamed your predecessor with his politics of of know it all and condemn everything govt is doing.
Thats what this Government is all about. Continue good works RB
Good.Now lets close the shameful gap with the other zambia.Our country is almost a carbon copy of Chile yet so behind.Chile’s econ is made up of mining,agriculture & tourism.They have heavy involment in mining by foreign companies just like us.They’re 38th largest in area we’re 39th & populations almost equal.The only difference is their larger services sector.So keep the growth & surpluses going coz there’s no reason we should not be like Chile yet we’ve got the same type economies yet ours has very low per capita income.
4 Enka Rasha,
Chile doesn’t give all it’s tax revenues away, so it can invest money in other economic sectors.
This is good news Lusaka Times. Sure we have potential to do achieve high economic performance than this. Let us just put our priorities properly, the sky is the limit. Jealous down, it indicates sound economic management to achieve such economic growth. On this one I salute you RB.
#5 MrK, after your recent shameful lies on Chilean mining taxes, you have proved to be a liar, an ignorant liar. Zambia is on the right track. The economy will change for the betterment of all Zambians, not the “change” that you want to propagate.
Rather than exposing your ignorance on economic matters, maybe instead you should debate Chilufya’s latest gaffe – the homos – maybe you can add something useful there.
MrK, check the following: “The team led by George Tsibouris, said revenue collections were expected to exceed the projections in the 2011 budget, due in large part to INCREASED TAXES FROM THE MINING SECTOR, which should provide room for additional infrastructure and pro-poor expenditures.”
Guys like you would like to give the impression that Dr Musokotwane does not collect any taxes from the mines when he has explained that instead of Windfall tax, his government has Variable Profit Tax. The minister has explained that VPT will build Zambia’s copper industry to the level where Chile is. Chile’s status as the world’s leading copper producer did not come about by accident, it is because of progressive tax policies which encouraged private and public investment in the mining sector.
As much as I appreciate these statistics on our improving economy a key fundamental change needs to be affected asap. The civil service is way too bloated. No doubt a huge chunk of gov. revenue is going to retaining these (largely unproductive) civil servants. Lets find a way of getting them into the private sector.
H.H. Sata,
‘Guys like you’ don’t understand that the mining boom only comes from the record high copper prices, not because Zambia is such a great country to invest in or even because the MMD is giving everything away.
At $10,000 per tonne or more, the mining industry cannot be ‘scared away’ by taxes.
On the other hand, as soon as copper prices are back at $2500 per tonne, they will be gone forever anyway.
H.H. Sata, ” #5 MrK, after your recent shameful lies on Chilean mining taxes, you have proved to be a liar, an ignorant liar. ”
You’re nothing but a useless MMD cadre, who will say anything if the price is right. I’m sure that’s not the only thing you have for sale? Hmmmm….?
Now, get back to me when the human development index starts to pick up. Until then, it doesn’t matter what GDP say.
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