Domestic debt has reduced liquidity in economy – CSPR

The Civil Society for Poverty Reduction (CSPR) has observed that the increase in domestic debt from K12.7 billion in n2017 to K13.9 billion has contributed to the reduction in liquidity in the economy.

CSPR Executive Director Patrick Nshindano says the increase in domestic debt is mainly driven by arrears owed to contractors more especially in the road construction sector.

Mr Nshindano notes that the reduction in the level of liquidity in the economy pushes up interest rates due to the high rate of non-performing loans.

He further notes that government expenditure has continued to be higher than projected revenue due to debt repayment with external debt standing at US$9.3 billion from the US$8.7 billion recorded last year.

Mr Nshindano has however, observed that Zambia’s economy in the first half of 2018 has remained relatively stable but with stagnated growth.