The Zambia Association of Manufacturers (ZAM) has emphasized the importance of restoring stability in the macroeconomic environment to benefit the manufacturing sector.
ZAM’s Chief Executive Officer, Muntanga Lindunda, highlights key strategies for enhancing the sector’s contribution to GDP stating that bringing inflation within the 6-8% target band is crucial to address rising production costs.
The ZAM CEO further advocates for fostering a growth rate above 6%, aligning with the Vision 2030 baseline scenario.
Ms Lindunda called for enhancing economy-wide resilience to climate shocks through energy diversification and climate-resilient agriculture.
She said challenges faced by the sector include high corporate income tax (CIT) at 30% and value-added tax (VAT) at 16% adding that addressing delayed VAT refunds is also essential.
Ms Lindunda called for action on depreciating exchange rates and rising fuel costs.
She said high licensing costs negatively impact business operations, with manufacturers potentially facing up to 49 licenses.
Ms Lindunda said market challenges arise from porous borders that encourage smuggling, unfair competition, and price undercutting.
The ZAM CEO urges the government to address revenue losses due to tax evasion and quality/safety concerns.
She said excessive council levies hinder investment and negatively impact value chains.
This came to light during a National Budget Consultative Meeting in Lusaka organised by the Ministry of Finance.
