GOVT ACTS TO STABILISE EXCHANGE RATE

BUUMBA CHIMBULU

GOVERNMENT intends to ride on various provisions provided in the Public Procurement Act of 2020 to address revenue leakage, stabilise the exchange rate and ensure enough liquidity in the economy. The Act has provisions which enhances the participation of Zambian citizens in the procurement system, as a way of ensuring that money circulates in the economy.

It is also meant to address over pricing of goods and services procured by Government. On April 16, this year, Finance Minister Bwalya Ng’andu signed and issued a commencement order to bring into effect the Public Procurement Act of 2020 aimed at providing a more efficient, effective, transparent and accountable public procurement system in Zambia.

The Act repealed and replaced the Public Procurement Act No. 12 of 2008. According to Dr Ng’andu, Government was eager to ensure that the new Act was a Zambian centric piece of legislation. He was speaking recently during the ZNBC Sunday Interview programme.

 Dr Ng’andu explained that Government intended to use the Act in addressing the current situation of putting pressure on the exchange rate by awarding contracts to foreigners who immediately bought dollars once paid in Kwacha. “That puts pressure on the exchange rate. It also denies liquidity to go into the economy. So there are two bad things happening at the same time: you are putting pressure on the local currency, partly because of that, at the same time drying up liquidity in the economy. “When I pay you [local contractor you will go and invest in the economy.

It is not about appeasement, it is about running the economy properly. You cannot have your economy becoming a leaking bucket where every value generated somehow ends up going out of the country. We have to keep money among ourselves,” Dr Ng’andu said. He stressed that Zambia would not sub contract development to other people saying: “to give contracts to Zambians is not foreign phobic. It is a sensible thing to do.” Dr Ng’andu also said the Zambia Public Procurement Authority (ZPPA) would on a quarterly basis publish reference prices of various goods and services that Government procured from time to time.

That, he explained, that would form the benchmark for pricing goods and services. “The reason here is that we have been told that when Government is procuring somehow procured at higher price than anybody else, so that shows that something is not quite right,” Dr Ng’andu said. He therefore appealed to Zambians, particularly the private sector, to read and utilise the document to advance their business