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Zambia: Poverty levels worry State

By NANCY MWAPE

GOVERNMENT is concerned with the high poverty levels in Zambia and low per capita incomes despite significant strides made in growing the economy over the last decade.

Situmbeko

Minister of Finance and National Planning Situmbeko Musokotwane said in the past few years, the economy has been transformed with the private sector playing a significant role, gross domestic product growth being high and sustained at above five percent since 2003.

Dr Musokotwane said Government has managed to contain fiscal deficit to sustainable levels while inflation has reduced to single digits.
The minister said this in a speech read on his behalf by Finance and National Planning permanent secretary Anthony Undi at a Public Expenditure Review workshop organised by the World Bank in partnership with the Economics Association of Zambia and Caritas Zambia.

Dr Musokotwane said Government focus is to improve the living conditions of the majority Zambians, especially those living in rural areas.

“Government recognises that despite the achievements that have been scored, challenges remain. Although poverty is now lower than it was a decade ago, it is still high. Rural poverty has not receded with many of the rural communities living in extreme poverty,” he said.

He said Government has stepped up efforts to accelerate investments in infrastructure and social sectors such as roads, schools, hospitals, clinics, agriculture, energy and water.

Dr Musokotwane said despite all the positive developments, it is legitimate to ask whether the country has maximised benefits out of the available resources and whether public spending has resulted in improved quality of services especially for the majority rural poor.

Speaking at the same function, World Bank senior economist Julio Revilla said Zambia has made strides in macro economics based on adequate economic policies and not just copper mining.
Mr Revilla said structure reforms as well as fiscal monetary and exchange policies have resulted in a stable macroeconomic environment of low inflation.
He, however, noted that Zambia remains too dependent on copper exports and increasing revenue remains a challenge.

“Despite fast growth, Government spending remains constrained by resources. It will be difficult to increase revenues in the next five years and this remains a challenge,” he said.

Mr Revilla said budget execution has improved with spending directed towards education, roads, health and agriculture but poverty and inequality has not reduced.

“Poverty reduction is a difficult goal to achieve through budgets on an annual basis but Government must identify programmes that have an impact on reducing poverty,” he said.

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