Q FM Africa's Modern Radio
The International Monetary Fund (IMF) says there is an urgent need for Zambia to contain the fiscal deficit in order to alleviate financing pressures that are keeping interest rates high and crowding out lending to private sector.
And the Fund has welcomed President Edgar Lungu’s directive calling for a review of the mining tax regime that came into effect this year, saying it has had negative impact on the mining sector.
Briefing journalists in Lusaka this morning at the end of an IMF Consultation Mission to Zambia, IMF Mission Chief Tsidi Tsikata hopes that resolution of the impasse between government and m
ines will result in a transparent system applicable to all mines.
Mr. Tsikata says the mission also welcomes the recent easing of documentation requirements for VAT Refund claims of exports and urges the authorities to resolve the large stock outstanding claims.
Mr. Tsikata notes that while pressures on the economy have grown, the ch
allenges are not insurmountable.
He says resolute actions to contain the budget deficit, resolve the mining tax disputes, and foster policy coherence and stability would go a long way toward boosting investor confidence and unlocking the country’s high growth potential.
Speaking at the same briefing, Secretary to the Treasury Fredson Yamba says the challenges the country is facing are arising from both domestic and external factors.
Mr. Yamba says on the external side, the falling of kwacha prices and the strengthening of the US Dollar have led to challenges for mining operations and volatility in the exchange rate.
He has assured that government will ensure that fiscal and monetary policy are in tandem so as to enshrine macroeconomic stability.
The Secretary to the Treasury has disclosed that as directed by President Lungu, the ministry of Finance has engaged in dialogue with the affected stakeholders in the mining sector so that they arrive at a resolution that will ensure continued operations.