Mon, 08 Jan 2018 13:43:57 +0000
By BUUMBA CHIMBULU
THE economic performance in 2017 was relatively stable owing to steady macroeconomic fundamentals, says an economist, Noel Nkhoma.
The economist has however advised Government to tone down on infrastructure development in 2018.
Mr. Nkhoma said the relative stability was anchored on Government’s efforts to contain fiscal deficit and ensuring that inflation was a single digit.
“The year 2017 can be described a year of stability, looking at where we are coming from 2015, 2016, the economy was in turmoil, it was stressed, the country’s macroeconomic performance was stable,
“I think what we saw in 2017 was a year of relative stability and I think it was anchored to contain fiscal deficit which I think under difficult circumstances Government tried to contain excessive expenditure, and went on to stabilise the exchange rate which is very good for business,” he said.
Mr. Nkhoma, also BetterNow Finance Limited chief executive officer, however said much as there was stable macroeconomic fundamentals, there was contraction in the economy.
In an interview, Mr Nkhoma said the financial sector during the year under review suffered from the highest Non-Performing Loans (NPLs) at 19 percent against the standard of 10 percent, a development he said was not good for an economy.
He said this led to credit crunch, thereby affecting credit access by the private sector.
Going into 2018, Mr. Nkhoma observed the need for Government to continue with fiscal consolidation and discipline while toning down on infrastructure development.
“Government should at all times maintain fiscal discipline, the rule is simple, and you cannot spend what you do not have so Government should strictly adhere to very strong governance more especially on fiscal discipline,
“Infrastructure is very important in any economy but I think we invested much in this sector which in turn has not been able to begin to pay back, that tells you that the investment was managed haphazardly. We did not look at the priority sectors which impact of economy expansion,” he said.
Mr. Nkhoma emphasised that “Rome was not built in a day.”
