. Chanda

By REBECCA MUSHOTA  –
GOVERNMENT has released US$120 million on the market to arrest the depreciation of the Kwacha against major convertible currencies, a move that will see the Kwacha start rebounding by today.
President Edgar Lungu said the money has been released to offset Government bills in sectors like health, education and construction.
This is according to President Lungu’s Special Assistant for Press and Public Relations Amos Chanda, who briefed the Press at State House yesterday to announce measures Government had put up to arrest the rapid depreciation of the Kwacha and energy deficit.
President Lungu said the interventions to arrest the plummeting Kwacha include the release of the $120 million from part of the recently procured $1.2 billion Euro bond.
The money was released between Thursday and yesterday.
“The Kwacha will, starting today, show signs of recovery because of the money that is being released. Part of the reason that the Kwacha has been performing badly is because some sectors have slowed down due to non-payment,” he said.
President Lungu said the increased volatility of the Kwacha appeared to be reflecting market panic more than underlying fundamentals.
The President has therefore directed the Finance minister to work closely with the Central Bank to assess additional market intervention measures to address the volatility.
Mr Lungu urged the public and private sector to reduce on imports and increase exports as well as avoid activities that would lead to further demand for forex as a way to calm the Kwacha.
The Kwacha has been depreciating due to among other reasons, low price of copper, a commodity which is the country’s main forex earner.
In the energy sector, President Lungu has sanctioned remedial measures including power importation and transferring shares from the Ministry of Finance to the Industrial Development Corporation (IDC) which would allow the IDC source an initial $500 million to invest in the energy sector.
The President has instructed Zesco to operate more efficiently by being self sufficient, reliable and not rely on expensive measures like importing power.
Government has also signed a contract with an independent power supplier and was talking to another to supply power by January among other interventions.
The measures would see Zambia export power in less than two years.
He has thanked Zambians for putting up with inconveniences of power cuts which have affected both small and large businesses.
“This is what I think about every day. I want the nation to know that no one feels the anguish of these disruptions more than I do,” President Lungu said.
Meanwhile, President Lungu has said it is regrettable that some people have reduced the power and currency challenges to factors of political rhetoric.
He said Government was in control and citizens should not panic but instead work together to rise above the problems.
The President would announce major measures Government had taken on September 18, this year when he addresses Parliament.