Zambia Says Clock Is Ticking as Reforms Face Vote Deadlineby
Zambian Finance Minister Felix Mutati said the newly re-elected government only has a couple of years to get the economy out of its rut, before the start of a new election cycle makes reforms harder to carry out.
Zambia is suffering an economic slowdown due to the drop in price of its key export, copper, and a lack of rainfall, which has curbed output from hydropower plants. Against that backdrop, President Edgar Lungu won a tightly-fought election in August, running on a pledge to make the economy more resilient.
The next year or two offers a window for the government to take “hard decisions,” Mutati said at a press briefing in Washington on Saturday during the International Monetary Fund annual meeting. During the second half of the government’s five-year term “we tend to be more careful,” he said.
The government must capitalize on its post-election “political capital,” Mutati said. “If we don’t do it now we aren’t going to be able to change the economy,” he said.
Growth is forecast at 3.2 percent in 2016, compared with an average 7 percent pace in recent years, he said. The government has outlined plans to stabilize the economy through spending controls and debt management, but a full-fledged recovery will also require fixing power generation and transportation infrastructure, he said.
An IMF team is due to visit Zambia, Africa’s second-biggest copper producer, later in October to discuss a fund-supported economic stabilization program, the finance ministry said this week.