China for years has been manipulating it’s currency strength for global trade positing as a strategic tactical approach as it expanded it’s industrial base.
China has been accused of undervaluing it’s currency so as to make it’s goods and services cheaper on the global market.
On the contrary a strong Kwacha makes Zambian goods and services expensive on the global and regional markets, this can lead to difficulties for Zambian export oriented companies to compete on the global market.
At the moment Zambia’s industrial base is still at rebuilding stage.
A strong Kwacha actually just stimulates the appetite for imports the action that costs the local growth of industries as well as job creation and or employment externalization.
The question that must be raised is that, is it prudent utilization of scarce resources for a government that has been seeking financing from the IMF to dedicate such colossal sums of dollars in currency manipulation activities? Can government quantify the benefits of such undertakings?
Francis Chipili
Business and Political Analyst
Disclaimer: The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy of Melo Media Zambia.
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