Vol. 3, Issue 4 (2016)
Zambian current economic challenges: Can growth strategies, turnaround strategies and alternative strategies rescue the economy
Author(s): William Phiri
Abstract: Zambia’s economic performance over a past decade is such an interesting case study worthy evaluating. For instance, at independence, Zambia inherited a very strong economy from the colonial master (Britain). As observed by Mwewa (2011), this is especially true in view of the first decade after independence. The relative prosperity of the 1960s is construed by many as evidence that Zambia was reaping favourably from the economic genius of its former colonial masters. A few years down the line, the economic outlook deteriorated due to a number of reasons such as the world recession, oil crisis, lack of qualified human personnel, dwindling copper prices and over dependency on World Bank and International Monetary Fund. The implication is that the Zambians lacked economic prowess to manage their own affairs as evidenced by the economic struggles of the 1970s and 1980s. However, there seems to be a dialectical economic tension that tantalizes many of those who analyze the Zambian economy. Despite such a gloomy economic picture, the economy rebound later due to citizen’s virtues of determination, hard work, honesty, personal integrity, patriotism and passion for mother Zambia. By 2006 to be specific, the nation’s economy attained a single digit inflation rate of 8.2% which was the lowest over a period of 30 years (Chibamba, 2010). The country was equally privileged to have had its national foreign debt reduced to US $635 million from US $7, 200 million, thereby reducing its annual debt service to US $33.9 million from US $374.8 million. Further the copper hit the historical high prices of US $3.05 per pound, a record harvest of 1.4 million tonnes of maize and the completion of the vision 2030. The overall economy grew by 5.8. This is a clear indication that Zambian economy by then provided opportunities for Zambians to liberate themselves from extreme poverty as observed by Magande in Chibamba (2010). However, ten years down the line, the Zambian economy significantly dwindled again. Financial analysts have further predicted that Zambia’s 2016 economic outlook is expected to continue to deteriorate even further as the global down turn persists. With the 7% percent growth target reduced to 4.6% in 2015, government is showing optimism by projecting GDP at 5% in 2016 but analysts at the World Bank and IMF expect slower growth at about 3.7% (Sichinga, 2016) . What has gone wrong? Are there lessons that we can learn from our past economic path that we undertook? What growth strategies, turnaround strategies and alternative strategies would be viable to help revitalise the economy again? These and many more concerns will be addressed in this paper.