Finance Minister Bwalya Ng’andu has revised Zambia’s economic growth for 2020 to 2 percent.
He announced during a news briefing that because of Covid19, growth is now projected to be lower at around 2 percent despite the anticipated significant recovery in the agricultural sector.
Mr Ng’andu that the tourism, mining, manufacturing, construction as well as wholesale and retail trade sectors are projected to slow down on account of the pandemic.
He said in order to provide relief to Businesses, the government has announced it will suspend excise duty on imported ethanol for use in alcohol-based sanitizers and other medicine-related activities subject to guidelines to be issued the Zambia Revenue Authority.
Mr Ng’andu said in order to provide relief to Businesses in the wake of the COVID-19 outbreak in Zambia, the government will also remove provisions of SI 90 relating to claim of VAT on imported spare parts, lubricants, and stationery to ease pressure on companies.
Addressing a Media briefing in Lusaka today, Dr Ng’andu said Government will further suspend import duties on the importation of concentrates in the mining sector to ease pressure on the sector and also suspend export duty on precious metals and crocodile skin.
The Minister has projected a slowdown in the country’s economic growth and reductions in revenue collection due to the outbreak of the dreaded COVID-19 pandemic although inflation will remain between 6 and 8 percent.
And the Finance Minister said the lockdown in South Africa will largely affect imports as that country is a major trading partner of Zambia.
Meanwhile, Dr Ng’andu said the Zambian Government is in the process of making applications to multilateral partner organizations for COVID-19 support.
He said the International Monetary Fund is making available a total of 50 billion US dollars to affected countries via rapid disbursing emergency facilities while the World Bank Group has approved support of up to 14 billion US dollars under a fast track COVID-19 Facility.
Dr Ng’andu added that the Zambian Government will release K2.5 billion to reduce domestic arrears owed to domestic suppliers of goods and services, reduce outstanding arrears to pensioners under Public Service Pension Fund and retirees under Ministry of Justice and reduce outstanding third-party arrears and other employee related commitments.
Dr Ng’andu said in addition, K140 million will be released to pay local contractors in the road sector.