• Government has continued to pursue a tighter monetary policy.
• This has also seen interest rates being high, in trying to control inflation rate.
• There hasn’t been much activity in terms of the private sector participation.

An Economist has observed that the country did not maximize in terms of growth in the first half of 2023 due to the contractionary policy that government has been pursuing.
Speaking in an interview with Money FM News, Emmanuel Zulu noted that government has continued to pursue a tighter monetary policy that has also seen interest rates being high, in trying to control inflation rate that has kept liquidity levels a bit low.
Mr. Zulu said in view of these interventions, there was less activity with regards to private sector participation in the economy during the period under review.
“In the first half we noted that when you look at key economic fundamentals especially inflation rate, it has been maintained on an average of a single digit, and if you look at the interest rates, I think the government has continued to pursue a tighter policy that has also seen the interest rates being high as well as in trying to control the inflation rate that has kept liquidity levels a bit low.”
“However, I should say there hasn’t been much activity in terms of the private sector activity because of those interventions, the contractionary policy that government has been pursuing,” Mr. Zulu noted.
He observed that the country could have achieved more than what was accomplished in the last six months if government had relaxed the monetary policy although growth was a bit positive.
“But with a tighter monetary policy, we see that growth has been positive but with some kind of shrinking to some extent. So I think we haven’t really maximized in terms of growth.”
“Ultimately what has affected this is the fact that there was a lot of anxiety around the debt restructuring deal because it was characterized by high uncertainty levels that also affected investment flows into the country,” he observed.