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ZIPAR URGES GOVT TO ISSUE INFRASTRUCTURE BONDS TO REAL ESTATES

THE Zambia Institute for Policy Analysis and Research (ZIPAR) says government should consider issuing infrastructure bonds to real estate investors in a bid to raise money to support the construction agenda.

ZIPAAR Associate Researcher – Public Finance Mbewe Kalikeka says infrastructure is one of the government’s expenditure items with a budget variation of up to 19 percent last year.

Kalikeka has told the Zambia Daily Mail that there is need for Zambia to scout for various options that can help fund infrastructure projects to provide relief to the treasury

“Government needs to look at numerous alternatives to fund infrastructure development like the public-private partnerships, which offer a low-hanging option for improving the efficiency of delivering road infrastructure projects,” he says.

Kalikeka has since called on government to consider buying part of the Eurobond as the price of Zambia’s bonds has dropped on the secondary international market.

“Investors currently perceive that a default is imminent and, as such, the value of that first bond of USD $750,000 is currently standing at USD $500,000. If government can raise this money now, it will significantly reduce the principal debt payment costs, However, the question that may arise is, where will the money come from?Government msy consider offloading some of the state assets such as the stakes it holds in some mining companies,” Kalikeka says.

He says the fiscal space has been eroded by personal emoluments and debt service, and in the 2019 fiscal year, both expenditures lines took 81 percent of domestic revenues, leaving only 19 percent to service other expenditure items

Kalikeka says this has led government to borrow to meet other obligations.

 

 

 


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ZIPAR INFRASTRUCTURE BONDS government