By PRISCA LUMINGU
PRESIDENT Hakainde Hichilema has directed the Bank of Zambia (BoZ) and the Ministry of Finance to come up with a mechanism that will further reduce cash transactions following the continued shortage of cash on the market.
Mr Hichilema said this will serve two purposes such as protecting people from being robbed of cash and avoiding illicit money flows that were being reported by the Financial Intelligence Centre.
He said the new dawn government would not tolerate corruption, money laundering and other illicit financial transactions.
President Hichilema said this through a post on his Facebook page yesterday.
Recently, the country experienced a shortage of banknotes and the central bank attributed the shortage to high demand.
The Economic Association of Zambia said the high demand for cash was amplified by the announcements that various government intelligence wings were monitoring movements of cash as the situation brings anxiety in an economy dominated by a huge informal sector and a black market.
EAZ president Lubinda Haabazoka said Zambia had a huge presence of cross border traders with markets at Kasumbalesa which are very developed and result in cautious behaviour from such traders when the narrative was that of tightening economic intelligence.
Dr Haabazoka said this was normal behaviour because businesses and households prefer to concentrate their savings in offshore banking zones as opposed to countries with conventional banking centres.
Meanwhile, the Bankers Association of Zambia (BAZ) said the cash inflow had stabilised on the market.
BAZ Executive Director Leonard Mwanza however said that some selected areas were still experiencing a shortage of cash.