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Foreign investment pledges rise to $3.2 billion

CHISANGA

PATSON PHIRI & KAPALA CHISUNKA, Lusaka
ZAMBIA registered a total of US$3.4 billion investment pledges last year in various sectors of the economy, beating the 2015 tally of US$3.3 billion.
However, the actualised foreign direct investment (FDI) for the period January to June 2016 was US$472.0 million and the estimate for 2016 stands at US$950.0 million, down from USD1.4 billion recorded in 2015.
Zambia Development Agency (ZDA) director-general Patrick Chisanga said the actual FDI for 2016 will only be known by end of September this year, after ZDA, in conjunction with BoZ and CSO, conducts the annual survey on foreign private investment and investor perceptions survey.
The estimated reduction in FDI inflows in 2016, relative to 2015, is mainly attributable to both electricity power deficits and investor hedging against political risk in an election year.
The increase shows the country’s resilience to economic shocks having shrugged off the effects of the 2016 Presidential and general elections.
Mr Chisanga said in Lusaka that the energy sector was the highest performing sector that recorded investment pledges totaling USD$878 million while construction recorded USD$297.6 million.
He said with the election period being over, ZDA expects a further upward trend in pledged investments and employment during the year 2017.
The manufacturing sector recorded the second highest with 22 percent of the total pledged investment, while the agriculture sector accounted for 15 percent.
The construction and real estate sectors accounted for 9 percent each, while the mining and tourism sectors accounted for 5 percent each.
The ICT and service sectors accounted for 3 percent each, the transport sector recorded 1 percent while the health and agro-processing sectors accounted for less than 1 percent of the total pledged investment.
Meanwhile, Mr Chisanga said the economic outlook for 2017 looks bullish and that the 4 percent GDP growth projection as projected by the World Bank is an indication of renewed confidence from over the year 2016 which was riddled with negative drought effects and intermittent electricity supply.
Meanwhile, an economist, Franklin Membe, has commended government for the single digit inflation as compared to the 18 percent last year.
Mr Membe, who said Zambia has done well in bringing its inflation down to a single digit, attributed the development to pronouncements by President Lungu last year. He, however, said inflation rates can drop further.
Mr Membe was speaking in Lusaka yesterday when he featured on Zambia National Broadcasting Corporation (ZNBC) television Kwacha Good Morning programme.
“Government has tried hard to control spending and that is what has caused the inflation to drop. There is a healthy relationship between government and the central bank, so the bank advises government on how to spend,” he said.

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