THE WAY KWACHA IS APPRECIATING EVERYDAY IS NOT GOOD FOR OUR ECONOMY – LAWYER FRED NAMAKANDO M’MEMBE SAYS
He wrote below:
ZAMBIAN KWACHA GAINS
We take note of the continued appreciation of the Kwacha, which is a welcome news for Zambia. However, it is true that too strong a Kwacha is not good and two weak a Kwacha is not good either.
So where do we stand? The economy has two segments, exporters and importers. Exporters lose out in Kwacha terms when the Kwacha becomes too strong, whilst importers gain when the Kwacha becomes too strong. The opposite is also true. Therefore, we need to surgically analyse our economy and ensure that a balance is struck, which benefits both exporters and importers. This balance is critical to ensure both exporters and importers are in equilibrium with regard to the exchange rate..
The critical path for exporters whose revenue is in Dollars and costs are in Kwacha is that Kwacha gain should not significantly erode their profit margin.
As regards imports, the Kwacha gain is welcome because it reduces the cost of imports. However, this same gain can undermine locally manufactured goods once it becomes cheaper to import than produce locally. It’s worth noting that the cost of production in Zambia is sub optimal. If not well managed factories can close and instead import cheaper goods.
On a final note, we are also curious to understand the key drivers that are driving the gain. If we isolate the high copper price, what else is contributing to this rapid gain. Is there any intervention from the Central Bank, or is it purely economic fundamentals that have shifted positively? It is critical that Zambians clearly understand what economic fundamentals have induced this gain.
Fred M’membe
President of the Socialist Party and 2026 People’s Pact Presidential Candidate
What does this ka ancestor really want? It seems he has now outlived his usefulness. The kwacha depreciates, he has something negative to say. When it appreciates, he has something negative to say. Just imagine how carelessly he has exposed his hurtful behaviour.
What and where is your point here? Are you not just exhibiting your dullness? Where do want the Kwacha to be because we know that whether i
the Kwacha gains or depreciates, you will still complain. Do you want the government to start controlling money markets? Where did you learn your economics? Maybe you need to go back. In Africa, Tunisia has the strongest currency against the USA dollar, are they not importing and exporting like us and all other countries? When Bally was promising the Zambian people, you scoffed at him saying that he lied to the Zambians. Hakainde being a visionary leader, he saw it coming, actually had it not been the inherited abnormal debt and the drought, things could have been much better. Mr. M’membe we can’t even make a mistake of putting you in power because doing so will be to undo all these great achievements HH and UPND government have done.