CONTINUED DEPRECIATION OF THE KWACHA
According to both Absa and Zanaco websites, slightly over K 18 is needed to purchase $ 1 as at today 29.12.2022.
Last month the Governor at Bank of Zambia ( BOZ ), informed the nation that the central Bank had spent $ 1.3 billion just to maintain a good exchange rate by flooding the market with dollars that had been earned through Mining Tax receipts.
In short, the exchange rate of Kwacha against the dollar has been artificial for almost one year now.
My prediction is that the next ERB announcement on the price of fuel will indicate another increment for diesel, petrol and kerosene since these are imported using dollars by the Oil Marketing Companies ( OMCs) run by private entities.
Here is what government is suppose to be doing ;
1. Identifying commodities that we are importing in huge quantities that we can actually start manufacturing locally such as agricultural inputs, wood and steel products and even medical drugs.
2. Provide appropriate incentives for companies that are ready to start manufacturing such commodities locally and in large quantities .
3. Ensure the right quality is achieved in the final product delivered to the local market so that Zambians support through procurement.
This is one strategy that will reduce the spending of excess dollars on the importation of certain goods aswell as services.
This will not be a short term activity but clearly one that requires immediate planning and implementation.
Lastly, I want to remind government that we need to get more FOREX from the Mining sector as nation ( I will get back to this topic on another day).
Christopher Kang’ombe
Kamfinsa MP &
PF National Youth Chairman
29.12.2022
