LUSAKA, Nov. 26 (Xinhua) The Bank of China Zambia Ltd. celebrated its 25 years of banking services in Zambia as a bridge facilitating the ever-growing econom
By Billy Katongo Litana
Being a professional in finance and economics, the current problems faced by our economy and kwacha are as a result of underlying defects that need serious attention to improve economic productivity and arrest the Kwacha decline. I believe the following needs to be looked into,
The financial services sector needs to be supported by our government
We need to rebuild investor confidence
Other sectors of the economy need to be productive
We need to end corruption
The Financial services Sector and its role in the economy
Before I start, I must explain one important principle of how the financial sector creates money. The Money multiplier multiple states that, for every deposit into a bank account, the increase in money circulation will be the amount of Money deposited in the bank multiplied by money multiplier. The Money multiplier is calculated as 1 divided by the reserve requirement. In Zambia the reserve requirement currently stands at 9% thus giving a