By Arnel Chitundu
THE Government’s failure to provide the status of the Export Proceeds Tracking Framework has the potential to undermine the growth of the economy, Economist Yusuf Dodia has said.
Speaking to The Scoop, Mr. Dodia said the Government, through the Ministry of Finance, had introduced the export proceeds tracking framework. It was expected that between January 1st and March 30th, changes would be seen in the amount of foreign currency coming into the country.
“Our expectation is that by April 1, 2024, we should be seeing close to $20 million to $30 million coming in every day as export earnings. That would impact the value of the Kwacha, making it stronger,” Mr. Dodia said.
He expressed concern because the export tracking framework gives exporters 90 days to bring their export earnings into the Zambian economy. He added that all companies exporting from January 1st would have had a deadline of March 31st to bring in their export earnings.
Mr. Dodia explained that it was unfortunate that from March 31 until now, no revenues from export earnings have been seen coming in.
He said this was worrying to the general public because it may indicate that the export proceeds tracking framework has been abandoned by the Government or is facing implementation problems that have not been shared with the public, specifically by the Bank of Zambia.
“By now, in April, we should have seen the Kwacha around K20 to a dollar, and by the end of April, it should be dropping as more Forex keeps coming into the country from export earnings,” he said.
Mr. Dodia reiterated that it was unfortunate what was currently prevailing, stating that the Bank of Zambia was quiet and could not explain why the export proceeds tracking framework was not bringing in the foreign currency needed to stabilize the Kwacha.
He emphasized that the export proceeds tracking framework would help the currency appreciate in value, leading to a decrease in the inflation rate and Monetary Policy Rate. This, in turn, would lower the cost of borrowing from the banking sector for many Zambian businesses.
He added that above all, Zambian businesses would have access to borrowing foreign currency from different banks to grow their businesses, import machinery, import raw materials, and expand the economy.
Earlier this year, Finance Minister Dr. Situmbeko Musokotwane explained that before exporting, one must have a Tax Identification Number connected to the Zambia Revenue Authority (ZRA) and then convert exports into Bank of Zambia to ensure all export invoices are paid into a Zambian account. This was referred to as a brilliant idea called Proceeds Tracking Framework (EPTF).
He said this would ensure the monitoring of all exports, considering Zambia has a lot of minerals that leave the country without records.
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