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Copperbelt-based business consultant, Augustine Mubanga, doubts if the announced Zambia’s official creditor committee Memorandum of Understanding (MoU) would result in economic improvement.
Mubanga said in an interview in Kitwe on Saturday that given the current economic instability, it would be difficult to predict economic improvement.
“Key economic drivers such as fuel will continue to drive upward prices and inflation too and the foreign exchange will still be under pressure especially that exports from copper have dwindled and the incentives given to the mines are not helping,” he observed.
Mubanga, the former Association of Mine Suppliers and Contractors (AMSC) lead, noted that the tight liquidity in Konkola Copper Mine (KCM) was very serious adding that it would continue impacting on a lot of businesses to a point of extinction.
“The slow approach in resolving Mopani Copper Mine (MCM) and the financial woes it has found itself in is also worrying,” he said, adding that in the short to medium term the economic outlook was not inspiring.
In the long term, Mubanga stated: “it will depend on the foundational key economic positive trajectory which is not looking good, and the food crisis will worsen due to price elevation.”
Read more : Debt Crisis: Zambia formalizes June agreement with Official Creditors Committee
On Saturday, Finance Minister and National Planning, Situmbeko Musokotwane announced in a statement shared with Zambia Monitor that an MoU had been agreed with its Official Creditor Committee (OCC) on the comprehensive debt treatment agreed in June 2023.
Zambia’s OCC was co-chaired by China and France, and Vice-Chaired by South Africa and that MoU formalises the agreement reached in June with official creditors and represents an important milestone in Zambia achieving long-term debt sustainability.
“Each official creditor will now begin their internal process to sign the MoU. Following the signing of the MoU, the terms will be implemented through bilateral agreements with each member of the OCC,” Musokotwane stated.
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