By Alexander Nkosi
The steps are very clear:
1) STEP 1: Restructure debt
2) STEP 2: Restructured debt means we lose less dollars to foreign debt service. This coupled with increased capital inflow that will come with IMF programme will strengthen kwacha and allow us to import inputs and machinery needed by SMEs for small scale mining, agriculture production and manufacturing. This is a local solution!
3) STEP 3: Restructured debt will reduce pressure for domestic borrowing and allow SMEs to access credit at low interest rates. This is a local solution!
4) STEP 4: Restructured debt will free up resources for government to provide better agriculture extension, construct support infrastructure and provide other services needed for SMEs to flourish and drive economic growth. This is a local solution!
5) STEP 5: Once debt is restructured and we are on an IMF program, we will easily access concessional loans (very low interest rates to be repaid over a long period of time).
6) STEP 6: All these will be done while reviewing policies to ensure consistency and while engaging the private sector to ensure they are key players in this economic reconstruction agenda. This is a local solution!
Local solutions cannot be implemented in isolation, they cannot work if we don’t address macroeconomic fundamentals like debt, exchange rate and interest rates. So we are getting there friends!