The Zambia Association of Manufacturers (ZAM) has expressed concerns that excessive appreciation of the Kwacha could affect the competitiveness of local manufacturers in the region. At the same time, the association acknowledges that the current appreciation has lowered input costs for businesses reliant on imported raw materials.
Speaking on Tuesday, ZAM President Ashu Sagar said the association is seeking a stable Kwacha to balance the interests of both importers and exporters. “The current rate of K20 to K22 is favourable. It has reduced costs for those heavily reliant on imported raw materials and has also lowered costs for companies with dollar-denominated loans,” he stated.
Sagar emphasized that while the stronger Kwacha benefits certain sectors by reducing import costs, excessive appreciation could make Zambian products less competitive in regional markets. The association advocates for careful management of exchange rates to ensure long-term industrial growth and regional trade competitiveness.
ZAM’s position highlights the delicate balance between currency strength and industrial competitiveness, underscoring the importance of a stable and predictable exchange rate for Zambia’s manufacturing sector.