Zambia
The macroeconomic prospects for Zambia remain robust despite a backdrop of global malaise and subsequent downside risk to base metals. Underpinning the robust performance is the continued development of the extractive sector and the strong fiscal spending programme geared towards addressing the country’s infrastructure shortfall.
Tight system liquidity, power rationing due to low lake levels, as well as exchange rate pass-through threaten to derail private sector consumption growth. Meanwhile, a more pronounced divergence between the fiscal deficit on cash and commitment basis reflects our concern that the government may fail to settle obligations, while a build-up in the stock of arrears may worsen liquidity challenges and further crowd out of private sector consumption and investment. We anticipate inflation to enter double-digit territory by end-Q3 as domestic pump price adjustments, exchange rate pass-through, and a disappointing harvest outweigh weak demand-side pressures and food price controls. Combined with weak investor sentiment, ongoing fiscal strain is forecast to yield a GDP growth outturn of a meagre 2.1% this year. (Source: Zambia Quarterly Update, September 2019.)
Macroeconomic Data
(2018)
|
Fiscal Balance (as a % of GDP) |
-8.3 |
|
Consumer Price Index (% change y-o-y, avg) |
7.5 |
|
Current Account Balance (as a % of GDP) |
-1.3 |
|
Real GDP (annual % change) |
3.7 |
|
GDP per Capita, US$ |
1,537.2 |
|
Import Cover (months) |
1.8 |
|
Population, million |
17.4 |
| Total External Debt (as a % of GDP) |
64.5 |