UPND GOVT ELATED OVER 5.2 BILLION DOLLARS IN FOREIGN RESERVES – WHAT HAS THAT TO DO WITH THE MAJORITY POOR?- Kellys Kaunda

By Kellys Kaunda

UPND GOVT ELATED OVER 5.2 BILLION DOLLARS IN FOREIGN RESERVES – WHAT HAS THAT TO DO WITH THE MAJORITY POOR?

A lot actually. Every single individual in Zambia is a beneficiary of foreign reserves.

Every item used or consumed every day is affected by foreign reserves.

The cloths on your back, the vehicle transporting you, the road on which you are traveling, the fuel in the vehicle, the drink in your favorite club, the drugs in the hospital, the materials your house is made out of, the school fees you are paying a foreign country, etc, etc, all demand foreign currency.

Being heavily reliant on imports, Zambia needs huge amounts of foreign currency.

This is one among other reasons you need foreign reserves.

This account is indispensable to the survival of this country and its economy.

Mess it up, and life as we know it will suddenly turn into hell.

Our neighbors in Zimbabwe experienced this. We did during the final years of the UNIP era.

The next question is: where is this money coming from?

Well, we export copper, precious stones, electricity, maize, etc.

We also borrow in dollars, receive development funds from the ADB, the World Bank, the IMF, donor countries, etc.

How sustainable is the foreign reserves account?

It would be fragile if the source is largely the borrowed funds.

The good news though is that copper production is on the increase and so are receipts thereof.

We are also building gold reserves which should provide a sense of comfort.

Now, be that as it may, foreign reserves are but just one of the aspects of this country’s economic story.

The rate at which this country’s economy continues to grow is way too slow to catch up with the pace at which other pressing problems are growing.

For instance, the rate of growth in employment opportunities is nothing in comparison with the rate at which unemployment continues to grow.

The same can be said about growth in other sectors such as infrastructure.

The needs far outweigh the pace of growth in this sector.

This is why development in Zambia is largely seen on television than felt in one’s life.

This is why in Zambia government has to invest in massive public relations strategies just so that somebody somewhere gets to know that something is happening.

Whatever public goods and services government is producing currently, important though they may be, are too few and far between to make any serious dent in the country’s poverty levels.