• Stabilization of the exchange rate requires positive trade balance.
• There is need to produce more for exports and consumption.
• Export earnings will have minimum pressure on the exchange rate.

An Economist has called on government to create a positive trade balance in order to stabilize the exchange rate.
Speaking in an interview with Money FM News, Trevor Hambayi said there is need to increase export earnings by producing more goods for exports as well as consumption so as to reduce pressure on the exchange rate.
Mr. Hambayi explained that doing so will reduce pressure on the exchange rate with regards to demand for the US dollar.
He added that producing more than what the country is spending is the key aspect to stabilizing the exchange rate.
“Stabilizing the exchange rate is a long term strategy, the stabilization of the exchange rate requires us to be able to create positive trade balance where we more goods that we are producing for exports and the ones we are consuming.”
“We also need to increase our export earnings so that we have minimum pressure on the exchange rate in terms of the demand that we are producing more than spending and that is the key aspect,” Mr. Hambayi said.
And Mr. Hambayi stressed the need to invest back into the economy so as to have adequate liquidity to enable the private sector take part in economic activities.
“We need to invest back into the economy in terms of capitalization, we need liquidity for the private sector to invest into the economy, to ensure that we can have that increase in trade balance and that is what is going to stabilize the exchange rate,” he stated.
The Kwacha opened the market on Tuesday trading at K17.10 Ngwee and K17.Forty One after closing Monday’s trading session at K17.07 Ngwee and K17.40 on a bid and offer respectively.