BoZ governor talks about inconsistencies under PF, says there is no cordination

BoZ governor talks about inconsistencies under PF, says there is no cordination

Bwalya-Ng’andu-KalyalyaTukiya-624x401We wouldn’t be where we are as a country if we did things in a coordinated manner, Bank of Zambia governor Dr Denny Kalyalya told the parliamentary expanded committee on estimates this week.

The PF regime has been accused of policy inconsistencies where they change policies each time someone someone says something.
Responding to concerns raised by committee chairperson Highvie Hamududu on whether Zambia had not over-liberalised its economy to an extent that it lacked sovereignty, Dr Kalyalya said the concept of liberaliation should not let everything loose. He decided to speak generally but it is easy to see that he is not happy with the PF government’s inconsistencies.

“That’s the issue. A liberalised economy does not mean that there should be no regulation. Here [in Zambia] when we try to control, it’s seen in extreme, we frown upon it and it gets dramatised and political pressure comes in and we move away. Dr [Guy] Scott talked about the withdrawal of Statutory Instruments 33 and 55, all economies need regulation. You can’t have everybody doing what they please and we have to examine this carefully,” he said.

“Zambia is not a poor country but we have poor citizens. We have a lot of unemployed youths and this is a time bomb. The education levels have gone down such that even putting up an application letter is a problem…and we shouldn’t be where we are as a country. We need to do things in a coordinated manner. For the economy to move, fiscal and monetary policies must be coordinated. Now we have a situation.”

Dr Kalyalya noted that the government had a challenge to ensure that the fiscal consolidation it outlined in the 2016 budget was achieved.

“When we talk about a coherent macro-economic framework, we are referring to the need to ensure that fiscal, monetary and external sector policies are all consistent with the government’s growth and inflation objectives,” he said. “The monetary policy remains a powerful tool, but on its own, it’s limited in the achievement and maintenance of macro-economic stability.”

Dr Kalyalya explained that the BoZ believed that the current economic challenges were not insurmountable and that they might offer the country an opportunity to create an economy that emerges on a stronger footing when the global economy recovers.

“However, for this to happen, accompanying structural reforms will be required that remove bottlenecks to the effective diversification of the economy,” he said. “We are not adjusting as a country because we want comfort zones. Let’s not waste this [economic] crisis, as to every cloud, there is a silver lining. It’s a pity we are not seeing opportunities as a country. Let’s break the barriers. If we want to promote tourism or agriculture, let’s go there in a smooth way, not in a small way and just talking. We are celebrating when we produce two million tonnes of maize? Are we serious? We can do better.”

And Dr Kalyalya said the BoZ was engaging the government over possibilities to start borrowing money from the Bank of China.

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