Maravi

Zambia’s economic growth causing inequality

Zambia’s economic growth causing inequality
By Chiwoyu Sinyangwe
Thu 13 Jan. 2011, 04:00 CAT

A key development and economic analyst says Zambia’s position among the top ten fastest growing economies in the world is only helping to grow inequalities between the rich foreign multinationals and indigenous people.

According to International Monetary Fund (IMF)’s forecast for 2011 to 2015 as quoted in The Economist magazine, Zambia is among the list of best performing economies being topped by China. Zambia is lying ninth on the ladder with its economic growth projected to average 6.9 per cent in the next five years beginning this year.

But Dr Fred Mutesa contended that Zambia’s impressive growth forecast is only good on paper as it does little to help the Zambians at the bottom of the ladder who continue to wallow in abject poverty estimated at 78 per cent in rural areas.

He said the variance between inequality of income and wealth of the country was vast and widening, driven largely by the lack of significant local participation in the country’s economy.

“That good standing is nothing to be proud of,” said Dr Mutesa who is also Zambians for Empowerment and Development (ZED) president.

“The growth we are seeing in Zambia is due to more copper being dug out of Zambia because of the current high copper prices. And given this government’s position on the current tax regime, without windfall tax, the people won’t benefit from this growth.”

He said foreign domination of the local economy was also worsened by the quality of jobs among Zambians working for foreign firms, which he said had continued to deteriorate.

“So, at macroeconomic level the economy is growing fast but the question is ‘who is benefiting?’ Things that make good standing of Zambia are nothing to be proud of because it is benefiting the foreigners who own the mining sector and foreign investors coming into the country,” said Dr Mtesa.

Other African countries in the top ten include Ethiopia, Mozambique, Tanzania, Congo, Ghana and Nigeria.

Labels: FDI, FRED MUTESA, GDP, POVERTY

posted by MrK @ 8:35 AM