The Bank of Zambia has called on countries in the African region to come up with sustainable Long-Term Finance (LTF) for financing productive medium- and long-term investments.
Bank of Zambia Governor, Denny Kalyalya, has observed that this is because LTM has proved to be key in growing and building countries’ gross fixed capital formation and long-term investments which are vital to social economic sectors.
Dr. Kalyalya noted that LTF promotes the growth of companies and results in proper allocation of funds to right sectors such as accommodation to support the urbanisation drive in Africa.
He said this in a speech ready for him by BoZ Director for Bank Supervision, Gladys Mposha, during the official opening of a three-day regional workshop on LTF scoreboard in Lusaka yesterday.
He explained that this is why the availability of LTF is important to foster productivity growth for sustainable structural transformation in the region.
Dr. Kalyalya however expressed concern that the financing of Africa’s transformation has been affected by increased focus on climate change and other increasing global uncertainties.
He has meanwhile thanked the Common Market for Eastern and Southern Africa (COMESA) Secretariat and the African Development Bank (AfDB) for signing an agreement aimed at capacity building targeting 37 African development fund eligible countries.
He added that countries in the sub Saharan African will need to raise between 30 to 50 billion United States dollars in additional funds per year in order to adapt to climate change.
The BoZ Governor noted that hence green bonds are becoming an avenue for mobilising financial resources to finance long term investments.
He further said the effects of Covid-19 on the world economies helped to emphasise the importance of mobilising LTF, noting that geopolitical unrests and recent inflationary pressure have also worsened economic uncertainty globally thereby limiting fiscal space for African nations.
Dr. Kalyalya however expressed optimism that the three-day regional workshop on LTF scoreboard will provide participants a chance to dialogue with governments and financial sector stakeholders on the importance of long- term finance in a challenging global context and outcomes being delivered by the initiative.
And AfDB Country Manager, Raubil Durowoju, has called for concerted efforts from all countries in financing the infrastructure finance gap of up to US$108 per year.
Mr. Durowoju stated that such high-level exchanges are vital and more relevant as the continent’s infrastructure financing needs continue to grow from the estimated US$130 to us$170 billion while the region is facing three major challenges of Covid-19 aftermath, climate change and conflict.
He explained that it is against this background that LTF for climate resilient infrastructure through initiatives like green bonds is critical in bridging the long-term finance gap and foster sustainable development of Africa during this challenging time.
And Mr. Durowoju has commended the participating central banks for responding positively during the data collection process for the LTF data platform, saying their contribution was key to capturing accurate data for LTF in Africa.
He further called for more dialogues among governments, policymakers and financial stakeholders to create a synergy that will provide solutions to the current financing deficit and consequently support African financial sectors and economies.
Kalyalya how are you going to pay for long term financing when the kwacha keeps depreciating thereby making financing unaffordable. You found the kwacha at K15 when you took over and today it’s over K17 and still climbing.
A formerly fired governor yapping nonsense