By Chishimba Kambwili
MAXIMIZING economic growth in Zambia has never been more paramount than now. Especially with the population explosion as more people need a share of the national cake.
As NDC we believe that growth alone without economic development cannot solve all the problems of unemployment, poverty or inequality, but accelerated economic growth is essential for creating sustainable jobs and as a precursor for economic development.
Zambia’s moderate growth rate for the past 10 – 15 years has not been sufficient to catch up to constant rise in the number of unemployed persons. As NDC we believe that for our country to achieve the levels of employment needed and to reduce poverty, the economy needs to grow at a minimum of 9% per annum.
The NDC does not advocate for a form of capitalist system associated with the absence of state involvement. State involvement should be minimal to the level of regulation through independent institutions that report to select committees in parliament.
In a bid to create a welfare state, we do not advocate for state interventions that unreasonably limit the growth potential of the private sector and entrepreneur growth to create jobs.
Raising capital in Zambia is very difficult for new entrants into the economy and we need to remedy this if we are to promote entrepreneurship. This is because agriculture and manufacturing have a higher job potential. In order to create a vibrant economy, the NDC when elected shall embark on the following:
Improving liquidity and lowering interest rates to policy rates of less than 4%, which is critical for the development and survival of small and medium size businesses and this as NDC shall be priority in the economic sector. High Interest rates are a challenge to the development of small and medium size business.
As NDC we shall motivate the SMEs and cooperatives sector and focus on developing them into large companies that can create jobs and effectively participate in stock exchange markets, especially for the women and youth.
As earlier mentioned, the introduction of a bank to be called “AGRICULTURAL INDUSTRIAL BANK”; SME BANK AND COOPERATIVE BANK shall give easier access to capital and loans to smaller businesses ventures that have cooperated to convert agricultural produce to finished products hence creating linkages between agricultural sector and industrial sector. Especially slicing, packaging, winery, canning, and dicing, production of juice, sauces, preservatives etc.
In addition, we shall also create a leasing organisation that shall not give finance but materials, equipment and machinery to do business operations. This organisation shall collaborate with the banks referred above for credit purposes.
We shall also Implement Fiscal and monetary policies that reduce financial outflows by ensuring that export proceeds are remitted back into Zambia’s circulation before being externalised.
Interlink the various sectors of the economy and bridge the gap between the formal sector and informal sector.
FOREIGN DIRECT INVESTMENTS
The NDC believes foreign direct investment (FDI) has not benefited Zambia positively. The FDI we shall attract as NDC government shall aim to achieve four things:
- create Real jobs:
real job are jobs that will enable, the labour force earns a decent pay that will enable them get mortgage loans, car loans, and other financial facilities. A decent job also entails that the jobs being created will be in the category of formal employment.
- increase tax revenue:
Government should be able to collect various taxes through pay roll and various taxes to provide service.
- Promote supply chain industries
Our FDI policies will enable the creation value chain addition to our final products. This should be a requirement for investors to illustrate on how their investment will promote other sectors of the economy
- Improve Balance of payments.
Our FDI will also improve the balance of payment and improve liquidity, reduce the cost of borrowing money and financial out flow, through companies that establish industries that produce the most goods and services that we import as a nation.
We shall revise the five-year tax rebate under Foreign Direct Investment Policy (FDI) and replace it with a tax rebate based on projected and actual cash flow or sales, and when the initial investment creates more 350 Real Jobs.
We shall reserve certain businesses strictly for Zambians or Zambian companies whose shareholding is 50% or more by Zambians. These may include businesses such as Broiler and Layers production, Brick making, etc.
Amend the Zambia Development Agency (ZDA) Act to ensure that FDIs partner with local private sectors and list their shares on Zambia’s securities and exchange market at an appropriate time.
We shall create capacity and business opportunities by putting in place a policy to compel government ministries, spending agencies and government Parastatals to strictly buy and contract not less than fifty per cent (50%) of its goods and services that are manufactured within the country from empowered groups.
We shall undertake national business trading reforms by opening domestic trading hours to 24 hours a day. We shall review archaic laws that were developed to keep black people away from the central business districts, by allowing transport and business to trade 24 hours a day and encourage for increased trading hours for all businesses and legislate for mandatory sectors and selected business to operate 24 hours.
Zambia has many unskilled learners and this has resulted into unemployed youths and an economy that is not knowledge-based. We shall radically improve our skills base through a variety of measures such as content specialization at early stages as outlined in the education sector of this manifesto, to have better educational outputs. The current skills shortages hampers growth.
As NDC, we will ensure that our country has more than, 5 months of import cover, an economy that is resilient to international crisis. This will make our nation borrow at lower prices than the current government because of investor confidence and the low risks associated with lending to our government.
This is critical because government needs to refrain from clouding out the economy from local investment if interest rates will be less than 4%.