Consumer Unity Trust Society-CUTS says there is need for government to make the environment more enabling for businesses to thrive in order for the country to increase its Gross National Income (GNI) per capita and reclaim its lower middle-income status.
In July this year, the World Bank reclassified Zambia to low income status from lower middle income for the 2023 financial year because of the deterioration of Gross National Income per capita estimates recorded in 2021.
CUTS Assistant Programmes Officer Jane Zulu explained that the reclassification is because the GNI per capita has been reducing which means incomes of the citizens have been low and according to the World Bank, that is below approximately K15000 per person in a country.
Speaking in an interview with the Zambian Business Times-ZBT, Zulu noted that there is also need to encourage entrepreneurship but that is also largely dependent on the environment that people are trading in adding that an enabling environment encourages people to venture into entrepreneurship, which increases people’s incomes, and businesses come up.
Zulu mentioned that the Covid-19 pandemic that hit the country in 2020 led to the closure of many businesses because of the restrictions that came with the pandemic noting that Zambia being landlocked, there were no interactions with other countries, which led to many businesses shutting down hence reducing the country’s GNI per capita.
She added that other challenges that led to the country’s GNI per capita deteriorating is the debt burden that the country has which has not enabled or created a conducive environment for investors to invest in the country.
“The Ministry has noted that covid measures are now flexible, people can walk around with no masks. We are slowly picking up and the confidence that has come with the new dawn government, restructuring of debt and the IMF package agreed with for the next three years is a positive sign”, she said.
She mentioned that Finance and National Planning Minister Situmbeko Musokotwane said government is working to reverse the situation and they are taking steps in the right direction.
