World Bank will not grow Zambia’s economy-US


THE Zambian Government must develop better policies that are business friendly to both local and foreign companies for economic development instead of depending on the World Bank, says United States Ambassador to Zambia Eric Schultz.

Mr Schultz said if Zambia continued to look at World Bank as an easy way of doing business, then it was “certainly going in the wrong direction”.

“It is important that the  Zambian Government develops policies that will enable business to grow but if you continue to look at the World Bank as an easier way of doing business,  then Zambia is actually going in a wrong direction,” said Mr Schultz

Speaking in an interview, the ambassador said the latest ranking of  the Zambian economy on 111 from 70 by the World Bank showed that Zambia was facing real challenges that needed a sense of urgency.

“You used to be in the 70s now you are 111 so you know this is not anything scientific but it shows that it’s not easy to start up a company and get it going from scratch in Zambia,” he said.

Mr Schultz  further  observed that policies currently in place by the Zambian Government were not business friendly to both local and foreign companies for better economic performance.

He said the 25 percent domestic interest rate Zambia charged on borrowers was very high and put many companies including young entrepreneurs in a difficult situation to start any business.

“I personally think that the single biggest problem that you have that inhibits young entrepreneurs in particular to establish businesses is the domestic interest rate which, at 25 per cent, is very, very high.

“So if are going to borrow at 25 percent, you are going to have an extremely high rate of return in order to make the business profitable,” he said.

Meanwhile, Mr Schultz noted that trade between Zambia and the United States had been slowly increasingly between 15 and 20 percent every year on.

The trade relations had been moving at a low pace due to the unstable Zambian economy.

“Trade has been increasing quite a bit year on year, between 15 and 25 percent. The fact is that it is coming from a very low pace which is one of the things we are trying to do increase trade between the two countries,” he said.

Ambassador Schultz noted that the US has put up many projects in order to help Zambian companies understand better how to market their products in the United States.

“We are helping Zambia through many US projects like AGOA and through sort of helping Zambian companies understand better to market their products in the United States,

“Frankly, the most important way is just by helping the Zambian Government develop better policies that are open to all companies both Zambian and foreign and that would include America,” he said.

He said although the Zambian economy was still strong, there was need to implement policies that would help the country boost its economy because currently the country was heading into wrong direction.

“Zambian economy is still strong but not as strong as it has been, I have tonnes of ideas on how it can be improved.”

Asked whether or not change of Zambian leadership had affected trade between  the twocountries, he said “it’s too early it’s the Government that I actually think has a pro-business agenda, “I have been here seven months and they probably have been in Government office for only three years, so I think we need to give them a little bit of time to sort of get things in motion.