Zambia trade deficit at $200m in first half 2009 – minister
Zambia recorded a trade deficit of $200 million in the first six months of 2009 compared to a surplus of $140 million in the same period last year, a minister said on Saturday.
Commerce Minister Felix Mutati told Reuters Zambia also missed its revenue collection target for the first half of the year by about 25 percent due mainly to cut-backs at mines in Africa’s largest copper producer.
Mutati said the trade deficit was due to a decline in copper prices produced by global economic slowdown.
However, the outlook for the second half looked brighter following the rise in the price of copper by almost 40 percent since July, he said.
“With the improved copper prices the mines have started implementing their development expenditure. We see a revival in the second half of the year mainly driven by the improved copper prices,” he said.
Mutati said the decline in government revenue was mainly due to lower collection of trade taxes because of reduced mining activity and the depreciation of Zambia’s kwacha currency, which made imports more expensive.
Mutati said other industries were also not importing as much as forecast.
“Our estimation is that we will be down in revenue collection by about 25 percent mainly because the volume of imports came down,” he said. “Our major importers are the mines and when they had problems they were not importing as much as they should.”
In its 2009 budget, Zambia forecast domestic tax collection of just over $1 billion and a similar sum from import duties in the first half of this year.