BUUMBA CHIMBULU writes
THE recently announced austerity measures need effective implementation to remove pressure on the economy, says Bank of Zambia (BoZ) Governor Denny Kalyalya.
Dr Kalyalya said yesterday in Lusaka at a media briefing that the austerity measures the ministry of finance recently announced were putting pressure on the economy as they had not yet started yielding positive results.
He said this could be witnessed by continued pressure on economic fundamentals
The measures, he said, could yield positive results if they were effectively implemented.
“I think the verdict is still out there anyway. If they were working well, we would not have the kind of challenges that we are having. So I think there is an issue of effective implementation of measures to be so we and I think that is why we keep coming to this,
“Effective implementation still remains an issue that we need. We need to take that bitter medicine so that we can get well so the short answer is that they have not and that is why we are still talking about them and we want them to be fully implemented,” Dr Kalyalya said.
He also called for implementation of fiscal consolidation measures to address higher than programmed fiscal deficits, elevated debt and debt service levels challenges which remained critical for overall macroeconomic stability and sustainable growth.
Dr Kalyalya also said BoZ would continue to buy foreign currency to ensure that the current reserves of US$1.4 billion, representing 1.7 months of import cover did not continue dwindling.
For the first half of the year, he said, net foreign exchange purchases amounted to US$243.0 million and mineral royalty receipts stood at US$172.6 million.
“Net Bank of Zambia purchases of foreign exchange from the market and mineral royalty tax receipts amounting to US$140.0 million and US$93.5 million, respectively, accounted for this outturn,” Dr Kalyalya said.
