ZAMBIA’S economic growth expectations for 2016-2017 are more optimistic than the outlook for the Southern African region owing to improved governance and democratic processes, according to 2016 Deloitte Chief Financial Officer (CFO) survey for Sub-Saharan Africa.
The report says Zambia’s growth expectations are 3.9 percent in 2015, 4.1 percent in 2016 and 5.0 percent in 2017.
Zambia’s more positive outlook is mostly underpinned by improving governance and democratic processes as well as its status as a peaceful and stable country.
The report says fears around a volatile global market compelled many CFOs throughout Africa to adopt an agile strategy to improve company performance and creating shareholder value.
Part of the agile strategies is the deepening slowdown of China’s economy and the Eurozone’s socio-economic afflictions.
This is no different for CFOs in Zambia who are grappling with similar challenges including exchange rate volatility, rising inflation, rising interest rates and the increased cost of funding.
The threat of foreign currency invoicing being outlawed, power shortages and the general slowdown in economic activity due to the challenges experienced by the mining sector and reduced Foreign Direct Investment flows, given 2016 is an election year, are other challenges.
According to the report, given the diverse economic growth outlook, CFOs in Zambia are fairly measured in their outlook for 2015 through to 2017, with 4.6 percent GDP growth predicted for 2015, 5.4 percent for 2016 and 5.9 percent for 2017. The report shows that Zambia is more optimistic in its growth outlook than the rest of the Southern African region, but less optimistic than East and West Africa.
In East Africa, a regional economic expansion of 6 percent in 2015, 6.3 percent in 2016 and 6.5 percent in 2017 is predicted, while CFOs in West Africa have slightly lower expectations with 4.8 percent in 2015, 5.7 percent in 2016 and 6.4 percent in 2017.