Zambia’s economic recovery, positive but twisting household realities

By Kelvin Chisanga

Despite signs of macroeconomic recovery remaining strong in Zambia, the cost of living has remained quite high because economic stabilisation does not immediately translate into lower prices for households.

While inflation has moderated, prices have not fallen; they are simply rising at a slower pace, leaving key essentials such as food, fuel, transport and utilities still expensive.

At the same time, income growth has lagged behind price increases, particularly in the informal sector where most Zambians earn their livelihoods. This has further weakened purchasing power and deepened household pressure.

Zambia’s continued dependence on few major imports, especially few commodities such as fuel and selected manufactured goods, have also exposed domestic prices to exchange rate movement channels, together with the global cost pressures accompanying along.

Furthermore, fuel and energy costs continue to raise transport and production expenses across the economy.

Fiscal consolidation efforts, though necessary for building up of long-term stability, but have shown limited short-term relief measures.

As a result, the recovery dynamics in Zambia have since remained uneven and mixed though largely seen on macro-level, with benefits yet to be fully felt by the ordinary Zambian citizens.