ZANACO has further indicated an expected slowdown in economic growth to 3.0 per cent in 2019, 2.8 per cent in 2020 and 2021.
This is contained in the bank’s Economic insights mid-year report, where it notes low aggregate demand for goods and services due tight liquidity conditions.
The bank’s Head of Economic Research Patrick Chileshe explained during a discussion on the insights report in Lusaka that the country’s economic growth is under strain.
He said inflation was expected to rise above target range in 2019 due tax induced reasons and food shortages.
He further said there is a serious slowdown in the economy, causing credit growth to be subdued as cash flows tighten for many businesses and that high interest rates will make it difficult for firms to borrow.
Dr Chileshe, however, said economic growth will remain positive although recovery may take another two to three years.