Economic analysts positive over Zambia’s growth By NELLA MUKALENGE

A GROUP of renowned economic research analysts say Zambia’s economy has grown by 6.8 percent this year and is expected to grow by 7 percent by 2013.
ABSA Capital Principal Ridle Markus of South Africa says the growth was underpinned largely by agriculture, manufacturing, construction and the transport sectors.
Mr Markus said the other major driver of Zambia’s economic growth lies in the mining sector adding that copper production increased by 2 percent last year and is expected to expand in the years to come as Governments’ targets to attain a million tonnes.
He said this in a presentation on 2012 Local Macro Perspective during the Barclays Bank Zambia research road show held in Lusaka yesterday.
The Barclays Bank Zambia research road show was designed to give insight on global, regional and local economic trends.
Mr Markus said along with the mining sector, investments in infrastructure and low inflation environment will boost economic growth.
“Although economic growth softened somewhat from 2010(7.6percent),it remained efficient at 66 percent year in year out in 2011 as growth was underpinned largely by agriculture, manufacturing ,construction  ,and transport sector,” he said.
He said Zambia will positively benefit from the $700 million Eurobond which will be used for infrastructure development.
Meanwhile, foreign exchange and rates strategist Mike Keenan said the Kwacha has become more competitive with the currency expected to strengthen in the fourth quarter compared to the United States Dollar (US$).
“The Kwacha is expected to remain strong over the fourth quarter due to high copper prices, Foreign Direct Investments (FDI) and other positive macroeconomic fundamentals,”he said.
Mr Keenan said with the current Policy Rate set by Bank of Zambia (BoZ), the inflation is likely to remain within the target of 7 percent this year.
“We expect inflation to average 6.6 percent in 2012 and expect the policy rate to remain unchanged,” he said.
At the same function, Barclays Bank Zambia managing director Saviour Chibiya said  economic research is vital for the undertaking of sound economic policies and business investments that boost sustainable economic growth.
Mr Chibiya said prospects for Zambian’s economy are good but faced with challenges and risks which need to be addressed.

Kampamba Shula view:
I can only but concur with the sentiments echoed by these economic analysts ,some of the fundamental data seems to support their assertions but I think its too early in the year to pinpoint where inflation will be at the end of year,it could undermine growth.
Mining sector growth cannot be understated in its influence in driving Zambia's growth...period.
The $700 million bond issue will definitely help build a base for strong growth in infrastructure.I am betting La farge will be set to benefit nicely from this one.