2019 budget is sufficient to secure an IMF bailout – Kalumba

Former Finance Minister Katele Kalumba says Zambia’s 2019 national budget has laid a foundation sufficient to secure a financial bailout from the International Monetary Fund (IMF).

Dr. Kalumba says the Country’s national budget could not have come up with a quiet appreciation and understanding from either the IMF or the World Bank if it was not sufficient.

He thinks that either the IMF or the World Bank could have criticized the budget by now if the Zambian government was not doing the right thing in restoring fiscal stability and growing the economy.

In an interview with QTV News by telephone Dr. Kalumba who was Cabinet Minister in the Frederick Chiluba MMD led government states that Zambia’s 2019 budget is therefore a strong financial plan.

Dr. Kalumba says he has particularly take note that external financing for this budget is a smaller percent compared to past budgets, an indication, he says, shows that Zambia can do it within its own means.

He states that the Country however needs to be fiscally prudent by reducing excess government expenditure as well as rethink the decentralization policy.

Dr. Kalumba is on the other hand confident that the targets made in 2019 national budget of growing the Zambian economy by 4 percent, sustaining inflation and deficits in single digit can be attained.

He says this is for as long as government maintains both fiscal and political stability.

And Dr. Kalumba has described as a very shrewd move the abolishing and replacing of the Value Added Tax (VAT) with the Sales Tax as announced in the 2019 national budget.

Dr. Kalumba says unlike with the VAT which cannot be varied at any time during the year if circumstance change, the Sales Tax accords some degree of variability in response to economic fundamentals.

He says this is why he finds the decision by the Minister of Finance to abolish and replace VAT with Sales Tax to be a clever move.