Govt settlement of local debts good but more needs to be done —Policy group

Payments of funds by Government from this year’s national budget towards dismantling of domestic arrears will unlock liquidity in the local economy.

The private sector therefore must play a critical role in the growth agenda for 2023, according to the Policy Monitoring and Research Centre (PMRC) acting Executive Director, Sydney Mwamba.

Mwamba however mentioned that expectations were that the legal and macro-economic environment must be conducive for the private sector to thrive.

“It is worth noting that already in 2023 government has started disbursing funds towards dismantling of domestic arrears, this path must be promoted to ensure liquidity in the local economy.

“In addition, the PPP Act must be enacted together with its operational framework as to attract meaningful contribution from the private sector,” he said recently in Lusaka at the 2022 economic performance and 2023 outlook town hall meeting.

Read more: Zambia, seven other African countries to grapple with debt in 2023

Mwamba observed that the success of 2023 annual budget growth projections was based on the sectors enshrined in the eighth National development plan (8th NDP) such as agriculture, mining and manufacturing.

He explained that these would be supported by growth in the electricity generation and success in debt restructuring.

“2023 has begun on a negative trajectory in terms of electricity generation that supports growth in the prescribed sectors,” Mwamba said.

He also said the slow pace in debt restructuring is further posing a risk to the implementation of planned programmes in the 8th national development plan.

Therefore, Mwamba said, there was need for efforts towards ensuring the country was self-sufficient through attracting right investments.

Meanwhile, Mwamba said Constituency Development Fund (CDF) programme in local authorities was expected to improve the utilisation of the funds

“With the delegation powers to provincial local government officers to approve CDF applications at the provincial level and delegation of the powers of the Secretary to the Treasury to the Principal Local Authorities Officers for variations of estimates of expenditure and disbursed funds, within the CDF programme in local authorities is expected to improve the utilisation of CDF,” he said.