BOZ Launches K5 Billion Resilience Fund to Support Agriculture and Energy Sectors
The Bank of Zambia (BOZ) has unveiled a K5 billion Stability and Resilience Facility (SRF) aimed at bolstering agricultural and energy sectors.
Economic expert Mr. Kelvin Chisanga highlights that this initiative is crucial at a time when Zambia’s economy faces unique challenges.
The SRF seeks to stabilize production costs and anchor consumption within predictable limits, mirroring the K10 billion COVID-19 stimulus package.
However, Chisanga warns that while the SRF includes some new features, its scope is narrower, focusing mainly on agriculture and energy.
He stresses the importance of avoiding the missteps of previous stimulus packages, urging systemic models of resilience to ensure effective implementation.
Moreover, the interest rate adjustments linked to the Monetary Policy Rate (MPR) are a vital factor in the success of this fund, particularly with the 300 basis point reduction for green-related projects.
The expert concludes that the SRF will only be effective if managed carefully and aligned with the central bank’s inflation control strategy. The balance of interest rates and targeted sector interventions will determine the success of this critical initiative.
