Implement diversification programmes, says BoZ

BANK of Zambia Governor Denny Kalyalya during the press briefing yesterday.

BANK of Zambia governor Denny Kalyalya has advised against the tendency to relax on implementing economic diversification programmes once the price of copper starts to rise on the international markets.
And European Centre for Development Policy Management (ECDPM) deputy head of programmes for economic transformation and trade Isabelle Ramdoo has advised African commodity producing countries such as Zambia to start thinking beyond the resource boom and quickly embrace economic diversification to survive through the current global downturn.
The price of copper, which has been trading below US$4,600 per tonne for over a year, has started rising and last Friday, the price was at US$5,856 per tonne on the London Metal Exchange.
Dr Kalyalya said there is need for all economic players in the country to engage more in activities that will bring foreign exchange.
“We would like to see all sectors playing a key role in supplying of foreign exchange, and this can only happen if we diversify the economy. We need to start paying less for services abroad and increase exports to sustain the growth. This way; we shall have the much-needed foreign exchange from many sectors.
“But we tend to relax on economic diversification programmes whenever we see a rise in copper prices, but this should stop so that all sectors can start to make meaningful contribution to the economic growth rate,” he said in an interview last week.
And in a posting on her blog titled ‘Thinking beyond the resource boom: African countries must avoid procrastination’, Ms Ramdoo said the resource sector has entered into a new phase with prolonged downswings in commodity prices, fuelled by the double effect of slower demand from emerging markets like China, and excess supply resulting from massive investments during boom years.
“While posing severe challenges, the current situation is also a unique opportunity to move away from the current economic structures and to create more resilient economic structures.
“Furthermore, the future prospects of the African continent, underpinned by a rising middle class that is expected to drive the future demand for consumables, and by the need to address the deficits in infrastructure, energy and construction, will no doubt create opportunities to channel part of the demand for certain commodities closer to home,” Ms Ramdoo said.

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