$ 187 million FROM IMF NOT ADEQUATE- SO LETS TAX THE MINES A BIT MORE
In each quarter of 2022, government spent an average of $ 300 million , bringing total annual expenditure to $ 1.2 billion as part of the Bank of Zambia role to offload dollars into the financial market. The kwacha still depreciated coming into the current financial year.
The $ 187 million, second installment announced by IMF yersterday will not provide adequate indirect benefits to increase liquidity in the forex market because it has other specific programmes to fund.
The initial $ 188 million from IMF for the month of July, 2023 did not lead to the kwacha performing better because the demand for dollars kept increasing and the money had commitments attached.
In short, we need to do more as a country to raise our own productivity levels in the economy. The aggregate demand must increase.
Last month, Dr. Denny Kalyalya, the BOZ governer, bemoaned the lack of dollars to defend the kwacha so we may need the mining companies to contribute a bit more in taxes to ZRA. The current mining receipts are not adequate and therefore calls for some upward reviews in taxes paid.
The school of thought that we simply get more mines operating to earn more dollars is appreciated but the benefits will only come in the long run. Setting up a mine starts with undertaking exploration, then mobilising capital and labour, before the actual production starts.
Compliments of the season .
& PF National Youth Chairman