World Bank advises govt to refocus economy

World Bank advises govt to refocus economy
Written by Florence Bupe
Sunday, February 08, 2009 8:05:56 PM

WORLD Bank Group vice president Obiageli Ezekwesili has advised Zambia to refocus its economy to other viable sectors for the country to effectively counter the impact of the global financial crisis.

Responding to questions during a teleconference on Tuesday, Ezekwesili said it was imperative for the country to invest in infrastructure development and build an economy based on other viable sectors than copper production.

“We are trying to renew our partnership with Zambia in various support areas, and we are trying to see ways of helping the country restructure its economic sector,” Ezekwesili said.

“For instance, what’s the strategy for a Zambia without copper?”

Ezekwesili on Monday met with President Rupiah Banda during the 12th Ordinary Session of the African Union in Addis Ababa, and disclosed that the two had discussions on Zambia’s democratic and economic status and strategy.

She emphasised that a country’s political status played a critical role in determining its economic standing.

Ezekwesili urged the government to partner with the mines in finding solutions to the challenges facing the mining industry.

“We have observed that government is focusing on the challenges facing the mining sector and is determined to find solutions to these problems. It is important that there is some form of partnership between the mines and government in seeking solutions to these challenges,” she said.

Ezekwesili said as part of its efforts to help developing countries’ economies counter the effects of the global economic recession, the World Bank had decided to increase lending to third world countries.

“As a bank, we have not been affected by the credit crunch, so we are not reducing our lending, instead we’re increasing our aid allocation,” Ezekwesili said. “This year, we are allocating US $42 billion to countries in the IDA (International Development Association).”

Zambia falls under the IDA category.

And Ezekwesili advised developing nations to revamp the private sector but cautioned governments against abandoning their regulatory role.

“There is need for developing economies to have a more functional private sector, but governments should not completely abandon their regulatory duties. Governments also need to redeem the public sector to enhance competence especially where you have public procurement systems,” said Ezekwesili.