The analysis is based primarily on the budget estimates presented by the Minister of Finance as part of the 2017 budget process.
It has been another tough year for Zambia’s economy, with sluggish global growth, low copper prices and ongoing power shortages continuing to weigh on economic prospects.
In addition, a weak Kwacha has compounded Government’s burgeoning debt obligations which, combined with increased Government spending, has prompted the fiscal deficit to balloon to an estimated 10% of GDP in 2016. This compares to Government’s target of 3.8% announced in the last budget.
The new Minister of Finance, the Honorable Felix Mutati, faces a difficult balancing act ahead if he is to navigate the tightrope between fiscal prudence and the expenditure needed to transform Zambia into a middle income country by 2030.