11 December 2012

Zambia: 'Zambia's Economy to Grow At 7.3 Per Cent. in 201'

ZAMBIA will record an economic growth rate of 7.3 per cent this year, slightly higher than the 2011 growth rate of 6.8 per cent, the World Bank has projected.

The Foreign Direct Investments (FDIs) have increased from US$350million 2009 to US$991 million this year.

This is according to the first Zambia's Economic Brief by the World Bank which was launched in Lusaka yesterday.

The brief which would be published twice a year highlights the recent economic developments and the state of Basic Human Opportunities for Children in the country.

It notes that Zambia's expected growth rate of 7.3 per cent puts the copper-rich country among the fastest-growing economies in Sub-Saharan Africa (SSA).

The 7.3 per cent growth rate is in line with the Zambian Government's target of real Gross Domestic Product (GDP) growth of above seven per cent for the year.

Zambia's economy has seen robust growth this year in construction, transport and communication, manufacturing and agriculture, even as the mining sector is expected to contract slightly.

In October, the bank said approximately one third of SSA countries would exceed growth rates of six per cent, but that the region as a whole would grow by 4.8 per cent in 2012.

"Capital inflows to Zambia have remained resilient despite global slowdown, with net FDI and portfolio investments growing steadily, from US$350 million in 2009 to an estimated $991 million in 2012.

"Gross international reserves are at a level of about three months of prospective imports. The Government aims, rightly, to increase reserve coverage mainly to guard against terms of trade shocks," partly reads the report.

It indicates that the recent fiscal policy has been expansionary, making it sustainable in terms of debt repayment.

With a high growth rate, the public revenues have also grown allowing the Government to raise public investments in roads and energy which if implemented efficiently could propel the country's growth further.

World Bank Country Director for Zambia Kundhavi Kadiresan said at the launch of the brief that the medium-term economic prospects for Zambia remained good though dependent upon continued high mineral prices.

The Bank said construction growth in the recent years had accelerated in response to demand coming from rising urban incomes and a marked pick-up in investment in mining and roads.

Speaking at the same function, Finance Minister Alexander Chikwanda said the brief provided an avenue for the country to tap into the World Bank's experience from its global reach and vast intellectual resources.

"The findings of the World Bank from their analysis of the thematic topic for this brief, 'the basic human opportunities for children in Zambia,' have significant policy implications," said Mr Chikwanda in a speech read for him by his Deputy Minister Miles Sampa.

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