economic policy, debt and budgeting process in zambia
TRANSCRIPT
P R E S E N TAT I O N T E M P L AT E
ECONOMIC POLICY, DEBT AND
BUDGETING PROCESS IN ZAMBIA
BUDGET PROCESS
Open Call Ministry of Finance Parliament Committee and
Approval
The budget is the most important economic policy tool for macroeconomic management and resource allocation for any government. It provides a comprehensive statement of the nation’s priorities. Over the years, the budget has evolved from being a simple accounting tool to a planning and governance document upon which the success or failure of government policy can be evaluated.
Budget Process
Auditing
Drafting
Legislative and Approval
Implementation
Achieve Real GDP growth of 5%
Attain domestic Revenue Mobilisation of at least 17.7% of GDP
Limit overall fiscal deficit to no ore than 6.1 % of GDP on cash basis
Maintain domestic borrowing to no more than 4% of GDP
Build Foreign exchange Reserves to atleast 3 months import cover
Maintain Inflation between 6-8%
Agriculture Industrialisation Tourism Mining
Macroeconomic Objectives
Seventh National Development Plan
Enhance Domestic Resource
Mobilization
Scale up Protection Programs
Raise levels of accountability
and transparency
Minimize Unplanned
Expenditures
Policy Consistency
Zambia Plus Economic Recovery Program
2018 National BudgetGovernment proposes to spend K71.6 billion in 2018
Government has accessed US$50 million for on lending to SMEs. This will create dynamic SMEs that will contribute to growth and jobs.
Energy
2016 2017 2018 2019 2020 2021 2022
Supply (GWh) 12,773 14,894 21,018 21,018 22,118 22,118 34,476
Demand (GWh) 16,764 18,314 19,117 19,944 20,721 21,185 22,021
Energy satiation to normalize after 2
good rainy seasons
New Energy from KGL, BGHES and LRB
0
5,000
10,000
15,000
20,000
25,000
30,000
35,000
40,000
Ener
gy (
GW
h)
Energy Load Forecast, 2016-2022
Supply Capacity
Power Demand
According to Zesco Energy satiation is projected to normalize after two good rain season. This
effectively means load shedding will end.
Energy
0
0.5
1
1.5
2
2.5
3
2010 2011 2012 2013 2014 2015
Bill
ion
s
Projected Fuel subsidy Actual Fuel subsidy
In the petroleum sub sector, fuel is still purchased by cargo shipments at spot price. Deals for
bilateral trade remain positive.
Agriculture
0
500
1000
1500
2000
2500
3000
2015 2016 2017
Agriculture Policy (K'million)
FISP
FRA
0
0.5
1
1.5
2
2.5
2010 2011 2012 2013 2014 2015 2016
Bill
ion
s
Projected FISP Actual FISP
In the petroleum sub sector, the Government will disengage from the procurement
of finished petroleum products with effect from1st March, 2017 to be undertaken
by the private sector.
In the petroleum sub sector, the Government will disengage from the procurement of
finished petroleum products with effect from1st March, 2017 to be undertaken by the
private sector.
Government will refrain from using export bans to regulate agricultural markets.
Tax: Zambia is one of the countries with high corporate taxes in Sub Saharan Africa.
15
25
22
25 25
28
30 30 30 30
32 32
30
35 35
0
5
10
15
20
25
30
35
40
Per
cen
tage
(%
)
Comparison of Corporate Tax Rates (2017)
Pension reform in Napsa deduction of K225
Honorable Minister of Finance, 2018 Budget address
BUDGET PROCESSEntry points
ApprovalCall for submissions Ministry of Finance Parliament
Minister of Finance
Budget presented in
parliament
Committee Review
Expanded budget review
committee
Youths can also submit
here
KEY ENTRY POINT
You can make tax and non-
tax submissions
Ministry Consultations
Budget submission compiled
Water and Sanitation
540.99
283.64
391.7
2015 2016 2017
Water Supply & Sanitation (K'million)
Water up to K564 million
Education
9433.33
9143.21
10641.93
2015 2016 2017
Education (K'million)
Education up K11.5 billion
Health
4464.09 4431.85
5762.03
2015 2016 2017
Health (K'million)
Health up to k6billion
Social Protection
1257.8 1273.76
2693.21
2015 2016 2017
Social Protection (K'million)
Social down to k2.3 billion
A LITTLE HISTORY OF MONEY
2020500BC 1700 1948 1971
World war Two
IMF is formed for global
monetary stability. Global
currency anchored in dollar
USA
US president Richard Nixon
Decoupled dollar from gold
Zambia
Proposing gold reserves
Romans
Romans used gold and
copper for coins
USA
United states backed the
dollar on one to one with
gold
Audit Report
Zambia loses revenue through unvouched for expenditure. This underscores the need for public finance reforms and the corresponding bills and acts to be legislated .
0
50
100
150
200
250
300
350
400
450
2013 2014 2015
Mill
ion
s
Auditors General Report 2015
Unaccounted for Revenue
Unaccounted for Funds
Misapplication of Funds
Unretired Accountable Imprest
Unvouched Expenditure
Unaccounted for Stores
Irregular Payments
Non Recovery of Advances and Loans
Failure to Follow Procurement Procedures
Undelivered Materials
Undelivered Materials
Non Submission of Expenditure Returns
Wasteful Expenditure
Overpayments
THANK YOU