THE implementation of the single Treasury account which was kick-started on January 4 is expected to improve fiscal management and create more efficient implementation of monetary policy, Bank of Zambia (BoZ) governor Dr Denny Kalyalya has said.
Dr Kalyalya said the single Treasury account was alsoexpected to contribute to improving fiscal management and more efficient implementation of monetary policy.
“The implementation of the Treasury single account is expected to contribute to improved fiscal management and more efficient implementation of monetary policy.
“In the past what used to happen is that Government balances would rely on banks for that money to come into Treasury accounts but with this measure we are able to get that money at the end of the day and its available for Government use,” he said.
He was speaking during the presentation of the monetary policy rate meeting for the first quarter of 2016.
He said through this development Government operations would be joined and help in cash management.
Dr Kalyalya said this was among several measures Government implemented in trying to address fiscal policy and that it was already beneficial to Government as it improved fiscal management.
He also said preliminary data indicated that fiscal deficit at 2.1 percent of the Gross Domestic Product (GDP) widened marginally in the fourth quarter. Dr Kalyalya said revenue Government collected could not much that of subsidies, hence adding pressure on the expenditure side. “Preliminary data indicate that fiscal deficit at 2.1% of GDP widened marginally in the fourth quarter. This reflects higher expenditures on account of the depreciation of the exchange rate and higher subsidy payments.
“This is another area which we are closely looking at because it has implications on the economy just like the current account deficit,” he said.