5. Zambian government presentation on the PRSP
Government informed the CG that the Zambian PRSP has two key objectives. The first objective is to attain strong sustained economic growth of between 5 and 8 pr cent per annum in the medium term so that per capita income can start to rise again. Secondly,
the PRSP pays attention to investment in people through investment in health, water and sanitation and education. In addition to basic social services, sound safety nets would be put in place for people in need but without financial means. Governance would have to be strengthened further in order to achieve the social-economic aspirations outlined in the PRSP.
ECONOMIC GROWTH
Macroeconomic Issues
According to the PRSP, the main macroeconomic challenge for poverty reduction is to achieve strong and sustained economic growth led by rising exports. Therefore in the key economic sectors of mining, agriculture, tourism and manufacturing, priority would be on boosting exports.
Zambia would attract quality foreign investors particularly those with ready cash to invest in large projects that could generate substantial spin offs so as to complement domestic investors in expanding exports. To encourage domestic investments, the macroeconomic environment would have to improve further. Interest rates and inflation should decline to low levels in a sustainable fashion while exchange rates would also be stabilized. Fiscal consolidation including accessing debt relief and containing Government expenditure would be paramount in meeting this objective.
Tourism
The PRSP outline a plan for the tourism sector which envisages two broad interventions, national and zonal. National interventions include rehabilitation of roads in tourist areas, rehabilitation of museums, tourist marketing, wildlife management, and human resource development. Zonal development emphasizes development work in specific tourist areas to make them attractive to tourist investment. Formulas have been designed to benefit local people in the tourism expansion.
Agriculture and Rural Development
With the PRSP, emphasis in agriculture would shift towards producing for exports, to escape the limited domestic market that becomes inevitable when agricultural surpluses are produced. Both large and small-scale production would be encouraged. For subsistence farmers, the emphasis would be on meeting their food security needs while encouraging them to grow cash crops on the side.
To establish large estates, commercial farms and smallholder out grower schemes in traditionally owned land, new farming blocks under longer tenure would be needed. In establishing these blocks, sufficient land would be reserved for local communities in order to meet current and future requirements. Additionally, incentives such as revenue sharing with rural communities would be agreed upon for these communities to let land.
Industry
The strategies on industry focuses on promoting industries that have the best chances of export success taking into account comparative and existing trade opportunities. These industries are likely to be processors of primary goods like agricultural and forest products.
Mining
On mining, Government bemoaned the pull out by Anglo American Plc from Konkola Copper Mines (KCM) and pointed out that the pull out posed a strong risk to poverty reduction efforts and economic growth prospects. However, Government mentioned that it stood ready to put up infrastructure, in the medium to long term, to facilitate the opening up of new large mining projects in prospective areas and sought assistance for the promotion of small-scale mining.
Infrastructure
One of the key priorities under infrastructure is to rehabilitate and regularly maintain the key trunk and district roads to secure them from disintegrating. New roads would only be constructed where there is economic justification while rural feeder roads would also be rehabilitated and maintained regularly. Zambia railways would be concessioned to private operators.
On electrical energy infrastructure, Government said that plans were underway to rehabilitate the Kariba, Kafue and Victoria falls, which had not been rehabilitated since inception. New infrastructure would be constructed on Kafue River by private investors to raise power generation to meet the expected rise in domestic demand and for export while rural electrification would be accelerated. For majority of Zambians depending on wood fuel, the objective would be to develop more efficient wood energy utilization in order to reduce on demand on this type of fuel thereby reducing de-forestation.
On water, Government disclosed that dams and delivery canals would be constructed on rivers by either the private sector or the Government to generate irrigation water for sale in farming blocks producing high value export crops.
SOCIAL INVESTMENT
Education and Training
Education in the PRSP focuses on improving the base by continuing the Basic Education Investment Program (BESSIP) while expanding it to grades eight and nine in a phased fashion. Pre-requisites for this like infrastructure development, teacher development and deployment, teacher compensation, materials production, procurement and distribution of learning and teaching material will be enhanced and continued. Others are equity and gender, school health and nutrition, upper basic school curriculum development, capacity building, decentralization and HIV/AIDS.
Health and HIV/AIDS
The highest priority in the health would be to institute the basic health care package to drastically reduce both the morbidity and mortality rate and contribute to poverty reduction followed by mechanisms to protect the poor.
Other measures would include continuation of Public welfare Assistance with improved management; working out new approaches by allocating resources to districts with high poverty levels; restructure the procurement system to ensure that purchasing of drugs is done more efficiently and on a needs basis; and strengthen the Community Health Innovation Fund to facilitate flexible action by communities on specific needs.
On the HIV/AIDS pandemic Government explained that the key goals would be to mobilize a multi sectoral response, reduction of high risk sexual behavior, increase and improve STD prevention, control and de-stigmatization of HIV/AIDS, among others.
RESOURCE REQUIREMENT
Government explained that a total of US$1.1 billion (from US$4 billion initially costed) was available for spending of which 67 per cent would come from external sources with the remainder coming from domestic resources.
IMPLEMENTATION MECHANISMS
Government disclosed that the annual budget would be the primary instrument for effecting expenditures for PRSP priorities during its program cycle. In this vain, the PRSP, MTEF, and PIP would all be synchronized to roll over very three years in view of their inter-linkage. All PRSP programs would therefore be translated into the national budget and no line ministry would be allowed to submit budget proposals without the due consideration of the PRSP programs.
Institutional Framework
The overall coordination of the implementation of the PRSP would rest with the Ministry of Finance and National Planning (MoFNP) with full participation of line ministries, other government institutions, civil society and international cooperating partners. The Planning and Economic Management Department (PEMD) in the MoFNP would be the focal point for PRSP coordination, monitoring and evaluation. The coordination aspect would also include harmonization of external financing for PRSP programs and other technical assistance. Appropriate mechanisms would be put in place to link the provincial administration system and line ministries with regard to planning, implementation, monitoring and evaluation of PRSP programs.
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