The Ministry of Finance has noted that government’s presence on the financial Markets is to help fund the 800 million Kwacha deficit in the National Budget and to pay for Maturities.
Minister in Charge Margaret Mwanakatwe tells Money FM news that this is despite government being aware that their presence on the markets crowds out the private sector.
This comes as the country’s administration says it is working to ensure that Zambia’s economy is driven by the private sector to realise the much needed economic growth.
According to Experts, the dominant presence of the government on the financial markets is what is hindering the private sector from driving the economy as there is not enough financial strength to drive the sector.
Mrs. Mwanakatwe notes that financial institutions prefer lending to the government as it is risk free as compared to the private sector.