By JAMES MUYANWA and JUDITH NAMUTOWE –

ECONOMIC experts and stakeholders have said the 2016 budget is an austerity one which is capable of enhancing confidence in the national economy among the international community and investors if fully adhered to.
The experts and stakeholders said yesterday that the major challenge for the government was resisting the various pressures and stick to the budgetary provision.
This was during the Zambia Institute for Policy Analysis and Research(ZIPAR)-Economic Association of Zambia (EAZ) national Budget analysis breakfast held at Lusaka’s Taj Pamodzi Hotel under the theme, “Fiscal Consolidation and Diversification: Going all the way.”
Speakers from EAZ, ZIPAR, Zambia Chamber of Commerce and Industry (ZACCI) and the International Monetary Fund (IMF) noted the government’s resolve to reduce the budget deficit to 3.8 per cent of the Gross Domestic Product (GDP) in 2016 from 6.9 per cent this year.
This is by increasing local revenue collection while cutting on unnecessary expenditures on the other hand.
They said to retain the full credibility, the 2016 budget should not be subjected to major adjustments after being passed by Parliament.
IMF country representative Tobias Rasmussen said the reduction of deficit from 6.9 per cent to 3.8 per cent was ambitious, but achievable and that a few countries globally have done it before.
“The deficit of 3.8 per cent of GDP is certainly ambitious, but it is not unachievable,” he said during his presentation.
He called for concerted efforts by the private sector and other stakeholders if the fiscal consolidation of the budget was to be achieved in the coming year.
Dr Rasmussen said reducing the budget deficits was more difficult in an economic downturn and that the international experience shows that that the magnitude of fiscal adjustments envisioned in the 2016 budget was large but not unprecedented.
He said the key was budget credibility by ensuring that the revenue measures were effectively implemented and expenditure ceilings strictly adhered to.
ZCCI vice-president Chabuka Kawesha said it was high time that the country actualised the industrialisation to grow the economy.
EAZ president Crispin Mphuka called for prior national planning to effectively manage the crisis that could come with the economic downturn.
ZIPAR research fellow Shebo Nalishebo observed that expenditure pressures would threaten the fiscal consolidation in 2016.
Mr Nalishebo said that personal emoluments would account for a bigger part of the budget at the expense of the social sector, which has suffered some significant reductions in the proposed budget.