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The Zambian Kwacha is on a rollercoaster, and the ride is making life expensive and unpredictable, warns the Zambia Institute for Policy Analysis and Research (ZIPAR).
Exchange rate swings, ZIPAR said, were more than numbers on a screen—they hit every household, every business and every plan.
“Managing currency swings is like herding cats,” said ZIPAR Interim Executive Director, Zali Chikuba, at the launch of a ground-breaking working paper on stabilising the Kwacha on Thursday in Lusaka.
Chikuba painted a stark picture of an economy at the mercy of the exchange rate.
Read more: Cross-border traders lament cost of doing business, say stable Kwacha yet to impact operations
“One day milk costs a little more, fuel spikes, fertiliser becomes unaffordable. For businesses, this volatility isn’t just inconvenient—it’s a threat to survival and confidence in the economy,” he said.
The paper identifies four key pillars—mining, manufacturing, agriculture, and energy—that could pull Zambia back from the brink.
“Without reliable power, productivity is a dream. Without productivity, exchange rate stability is a dream,” Chikuba warned.
Crusivia Hichikumba, Permanent Secretary for Investment and Industrialisation at the Ministry of Commerce, Trade and Industry, said Zambia was shifting toward an export-driven economy.
“We are building resilience in manufacturing, mining, and agriculture so Zambia can withstand internal and external shocks,” he said.
Underpinning this effort are new legal frameworks and fiscal incentives, including the Investment, Trade, and Business Development Act No. 18 of 2022, now amended to attract more investment.
To support local manufacturing, the government has suspended customs duty on imported raw materials not available locally.
“This isn’t just policy—it’s about creating jobs, lowering costs, and making Zambia productive,” Hichikumba said.
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