Reuters reports that Bank of Zambia Governor Caleb Fundanga has said today that Zambia’s inflation should stay in single digits this year helped by a good maize crop, and interest rates in Zambia are expected to decline further.
Zambia’s inflation ticked up to 9.0 percent year-on-year in June and the central bank has said higher oil prices are the main risk to the outlook, while easing food prices are expected to offset that.
“Inflation is expected to remain in single digits owing to prudent macroeconomic policies and the bumper harvest recorded during the 2010/2011 harvest season,” Fundanga said in a speech on Wednesday.
Food has the biggest weighting in the inflation basket and the central bank’s target is for inflation of 7.0 percent by the end of the year.
Zambia does not have a benchmark repo rate but rates on its 5-year bond are currently at 11.8 percent, after peaking above 20 percent in late 2009.
Fundanga also said medium to long-term economic prospects were bright and Zambia’s strong growth trajectory was expected to be maintained due to expansion in mining and other sectors of the economy.
“The robust GDP growth momentum is expected to be maintained premised on favourable growth performance in mining, agriculture, construction, tourism, manufacturing amongst other sectors.”
“This will be supported by favourable commodity prices on the international market, government’s investments in infrastructure and an expected increase in foreign direct investments,” he added.
In May, Finance Minister Situmbeko Musokotwane said the economy was likely to grow by more than 7.0 percent this year, which is higher than the International Monetary Fund forecast of 6.8 percent.
The growth forecast should be revised by August.
The economy in Zambia has been heavily reliant on copper mining but is becoming more diversified, Fundanga said.
“In the past, we had growth which was just mostly concentrated on mining sector (but) today we see growth particularly strong in agriculture where the majority of our poor people live,” Fundanga said.
[Reuters]
Well done good Dr F you are doing a great job son of our land.
What about the death of over 40 passangers on the Great East Road this morning? Lt please we need a report on this!
Dr Fundanga
Dr Musokotwane
Gentlemen we salute you…. sons of our land doing a great job
The youth need employment and not the unending rhetoric. Rhetoric won’t earn you our votes. Too late bamumbwe. PF has a roadmap for job creation and we challenge ZNBC to call for live debate on this critical matter. Viva Sata viva PF
I hope these are just political games to enable MMD sail through elections!
What have we done for inflation to remain constant whilst the global economy is shrinking?
Guys you are educated enough not to be drawn into political banking.
Ya,all those bottles of manzi.I think i should also be drinking alot of manzi in light of the coming
summer season.Just as recommended by Dr.Manda.or why not look at selling manzi to fans at
ndola stadium in october when Zambia will play Libya.
And the percent of Zambians living in poverty will remain double digit haaaaaaahaaaaaaaaaa
In this country, everything is political! We can’t talk about other issues without ever being political. The economic statistics are only indicators of what is happening in the economy. I don’t think the Governor here is raising any compaign issues as insinuated by some bloggers. Just sell your parties and your candidates, they just maybe voted for by some disgruntled electorates. Twanaka naimwe! Elections are just around the corner and we shall all exercise our right to vote in or out the political buffoons who shall themselvesfor the elections.
No 5 Produced enough maize to reduce food inflation… am sure thats above your thinking.
I am waiting for the usual ‘how does this help my grandmother in Shang’ombo’ or ‘you cant eat inflation’ hogwash from the paltry faculties (pf) nincompoops.
Imwe BANTU mudabwisana. What is bumper harvest? The price for mealie meal has never dropped for the past 3 to 4 years. The poor will remain poooooorwerrrerrrreerreerr. Lets give chance to some 1 to rule zambia. Not MMD & RB.
Registered voter et al,
This is not rhetoric. It is news, just news. Dr. Fundanga is an award winning central bank manager that deserves respect for what he has achieved for our country.
Granted, more jobs for the youth are a MUST and there is, albeit slow progress.
My point? Learn to appreciate. Apart from the question of jobs what point are you trying to put across?
By the way what sort of job are you looking for? You may not realise it, but you could get a job through this network. Tell everyone what you are able to do. What’s your trade?
If you do not have one look at retraining. Don’t just complain about on subject least understand and that has no bearing on your job prospects.
The Bank of Zambia and central statistics office inflation rate is very misleading. Currently the price of fuel is at US$1.60 per litre at current exchange rates and mealie meal price is at US$10. This is a country with approximately 70% of the population living on US$1 per day. The statistics are just are measure of monetary policy dsicipline and an indicator that though we have elections, the government has restrained itself from printing money. Therefore, it is a good sign from BOZ, but it is not life applicable to most poor people. Most poor Zambians would really love to see the prices of fuel and mealie meal go down by atleast 20% reducing their cost of living. They would love to have at least 80% of eligible population employed and earning something. VIVA PF, VIVA MCS!
why not vote for RB,WHY NOT MAINTAIN THE MMD GOVT CHWE CHWE CHWE
I wonder why the opposition is completely mute on what they would do differently from RB. All I hear is…RB this RB that….nothing of substance. To the less knowledgeable, statistical figures/benchmarks do not make sence at all. It takes those with an open eye to understand what is being talked about, let alone understand.
Bwana Governor – it would help if this translates in lower banking interest rates so that businesses and individuals can borrow affordably. This could boost investment and create more jobs. It would also help if the Kwacha is stabilised at around K5000 to US $ 1 in order to ensure no speculative forex trading. This helps financial planning. Please don’t get me wrong – it is good that end-of-year inflation is expected to be 7%. It just needs to mean more than that …
Oh please..who do these PF chaps thinks they are..fyonse kutalika..na Single digit inflation ni problem..dont cheat people with ur 90 day theory..MCS had so many 90 days between 1991 and 2000..he never implemented anything..come…please give us a brake
Just Jargon, utter Jargon from these Bean counters…they will complicate everything with their pointless language…”Inflation is expected to remain in single digits owing to prudent macroeconomic policies and the bumper harvest recorded…”
I detest Economists..give a Businessman this and he will tell how, not this stealth campaigning for the Ruling Party…utter B.S!!!
The problem in Zambia is that once you see titles to someone’s name like Dr. PHD etc …or IMF , World Bank or BOZ you think they know everything that comes out of their pie holes, is the truth no other way hence are afraid to question them…there is nothing in that article or statement just forecasts and B.S..typical economist’s B.S. This is why I like businessmen they tell as it is!!
Only the usual Party sympathisers will start jumping up and down like circus chimps without reading between the lines!!
” “In the past, we had growth which was just mostly concentrated on mining sector (but) today we see growth particularly strong in agriculture where the majority of our poor people live,” Fundanga said. ”
What kind of agriculture – cash crops or food agriculture? It’s the same as with mining. They claim ‘economic growth’ because foreign mining companies are exporting more Zambian copper, irregardless of whether it actually benefits the Zambian economy through tax revenues, shared profits, or high wages. Of course they ignore the destruction of the environment and labour conditions. In ‘Neoliberal World’, growth is growth.
we know how you cook figures. because thats not a true reflection of things . countries with a single digit inflation can not be compared to zambia.