The World Bank has observed that Zambia’s economy is likely to be affected if demand for copper by China remains weak.
This is because Zambia largely depends on copper as its main traditional export and China currently accounts for 45 per cent of total copper demand.
World Bank chief economist for the Africa Region, Francisco Ferreira, has called on the Zambian government to increase investments in rural areas as a means of closing the gap between development in rural and urban areas.
Speaking during a video conference to launch the bank’s Pulse Africa semi-annual analysis of Africa’s economic prospects Monday, he said infrastructure development such as huge airports in cities were meaningless if Africans in rural areas had no access to development.
“The government should invest more in roads to open up smallholder farmers to markets,” he said.
Ferreira also noted that currency depreciation in countries like Zambia had led to pressure on prices of goods.
However, the bank has projected economic growth for sub-Saharan Africa to be at 5.2 per cent in 2014 from last year’s 4.7 per cent.
Ferreira attributes this to rising investments in natural resources and infrastructure, and strong household spending.
World Bank lead economist for Africa Region Punam Chuhan-Pole stressed the need for the continent to consider looking at the services industry as an avenue for investments.
Early this year, Zambian President Michael Sata said the government would continue to foster a stable macro-economic environment which would be reflected in low and stable inflation, a competitive exchange rate and prudent fiscal management.