Once rebased, Kwacha will strengthen to 1964 levels, dreams minister Sichinga

Once rebased, Kwacha will strengthen to 1964 levels, dreams minister Sichinga

A Zambian bank note at the height of poverty and socialism in 1984

GOVERNMENT says it will proceed with plans to rebase the local currency to strengthen the value to 1964 levels despite calls by some quarters to defer it.
Meanwhile, Government says it will ban firms exporting raw copper as a way of encouraging value addition to the commodity.
Minister of Commerce, Trade and Industry Robert Sichinga said rebasing the Kwacha is necessary as it will lead to reduction in the cost of doing business; reduce inconvenience and risks associated with carrying large amounts of currency for transactional purposes.
Mr Sichinga said once the Kwacha is rebased, it is likely to become stronger against major convertible currencies, citing when the local unit traded at par with the British pound in 1960s.
“In 1964, our Kwacha and Malawian Kwacha were at par with a (British) pound. Exactly at K2 to a pound, this is because the currency was strong,” he said.
Mr Sichinga was speaking at the eighth National Dove Payroll and Human Resources 2011 conference under the theme “Operational Excellence,” at Lusaka’s Mulungushi International Conference Centre yesterday.
He, however, said currently the Kwacha’s value is weak trading in the K5,000 levels against the United States dollar while the Malawian Kwacha is trading at K167,000 against a dollar.
Mr Sichinga said rebasing the Kwacha will accrue huge benefits to everyone.
In January, Government approved the rebasing of the local unit and so far Bank of Zambia has commenced the process of procuring the rebased currency.
However, there have been calls by some stakeholders to suspend or hold the rebasing of the currency until next year due to uncertainties in the economy.
Some analysts have cited the rebasing of the Kwacha as partly causing the depreciation of the local currency, presently trading at K5,200 and K5,300 levels.
Commenting on the export of raw copper, Mr Sichinga said there is need for Government to promote value addition to copper, hence the move to stop the exportation of raw copper.
Mr Sichinga said Government is keen to meet one million tonnes of copper by 2015 with more jobs being created for the local people.
He said the country has abundant mineral resources such as emeralds, gold and cobalt and other semi-precious stones which require value addition and make meaningful contribution to the growth of the economy.

Daily Mail

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