Patriots for Economic Progress (PEP) president says Zambia’s economic crisis can be resolved by increasing internal productivity which can be made possible by reducing load shedding.
PEP president Sean Tembo said load shedding has restricted economic output which has resulted in the failure to achieve maximum productivity as a nation.
Mr. Tembo added that the huge debt burden due to heavy borrowing by the Patriotic Front (PF) government has contributed to the downward trend of the economy.
He said this has also led to the massive depreciation of the kwacha to the US dollar.
As long as we don’t have internal productivity, our balance of payment position will always be negative because we will be importing more than we are exporting,”Mr. Tembo said.
Meanwhile, economic analyst Yusuf Dodia said the mining industry which represents 80 percent of export earnings and 14 percent of the GDP has not been supportive to the economy for the last 1 year.
Mr. Dodia has attributed the genesis of the current economic crisis to the 2019 budget which indicated that the mining industry will have to pay more in mineral royal taxes and shifting from value added tax to goods and services tax which is non-claimable.
He said that the mining sector has found these new taxes aggressive, thereby becoming impotent in the contribution of the economy.
Mr. Dodia added that last year, Konkola Copper Mines (KCM) was taken over by the government because of the challenges in their operations, and this year, Mopani Copper Mines (MCM) lay off operations and its staffs.
When the mining sector and the government are not supportive of each other, what tends to happen is that the availability of foreign currency starts to decline,”Mr. Dodia said.
Mr Dodia further attributed the depreciation of the Kwacha to the insufficient dollar in the market which mainly comes from the mining industry.
He has since advised the government to make resolution with the mining industry in order stabilize the economy.
5 months ago