The Bank of Zambia has projected that the country my end the year with a Gross Domestic Product (GDP) growth below 2% if current trends continue.
Bank Of Zambia Governor Dr. Denny Kalyalya says there is a need to figure out what can be done differently in order to drive growth, without which, the country’s economic challenges will persist.
Dr. Kalyalya says the major drivers in the decline of GDP growth this year include contracted mining output, and challenges in construction, transport and Storage.
The Final Estimate for Zambia’s 2018 GDP was revised to 4% from an initial estimate of 3.7% and real GDP declined from 3.9% in 2019 to 2.3% in 2019. Current estimates for 2019 have declined from 2.3% to 2% and is expected to decline further.
Meanwhile, The Central Bank has increased the Monetary Policy Rate by 125 basis points to 11.5 percent from the previous 10.25.
Governor Dr.Kalyalya says the decision was made as a result of the tough economic conditions in an effort to keep the inflation rate under control.
He says the increased rate will immediately start to bring inflation towards the 6 to 8 percent target range.