By CASSEY KAYULA –
THE rise in export earnings and a slight import contraction resulted in 4.4 per cent drop in Zambia’s current accounts’ deficit to US$277.5 million as at September, 2018.
Bank of Zambia (BoZ) Governor Denny kalyalya said in September, 2018 preliminary data indicated that the current account deficit narrowed by 4.4 per cent to US$277.5 million, mainly on account of the increase in the surplus on the balance of goods.
Dr Kalyalya said higher earnings from Non-Traditional Exports (NTEs) contributed to favourable export earnings.
He was speaking at the 2018 dissemination workshop on foreign private investment and investor perceptions in Zambia, in Lusaka yesterday.
“In the third quarter of 2018, we saw some expansion in total domestic credit, which grew by 9.9 per cent driven by strong growth in lending to private enterprises and households and a pick-up in credit to government,” Dr Kalyalya said.
He said increased demand for working capital by private enterprises and lower interest rates on salary-backed loans to households partly accounted for growth in credit to these sectors.
Dr Kalyalya said the main finding of the Survey was that Zambia’s net foreign direct investment (FDI) inflows significantly improved, rising to US$1,179.6 million in 2017 from US$486.1 million in 2016.
This was mainly due to a reduction in FDI assets by US $72.1 million following repayment of debt by
non-resident parent companies owed to domestic enterprises.
Dr. Kalyalya however, said net FDI liabilities inflows rose by 67.1 per cent to $1,107.5 million.
“The other major findings of the survey is that Zambia’s private sector foreign liabilities inflows declined by 3.1 per cent in 2017 to $1,045.4 million from US $1,078.9 million recorded in 2016.
“Despite the decline, FDI liabilities inflows contributed the highest, following a growth of 67.1 per cent to $1,107.5 million from $662.8 million in 2016,” he said.