Despite the programme of economic reforms, the economy has remained virtually stagnant during the current decade. The policy framework that has been put in place has failed to deliver the new impetus to economic growth and social progress that had been envisaged at the beginning of the decade. During 1991-98, average growth was negative, annual growth rates being positive in only three out of the eight years. In 1998, the economy contracted by 2 per cent, thus lowering income per capita by around 5 per c ent. The 2000 budget has offered tax breaks for tourism and mining, but does little to cut the high indirect tax burden faced by manufacturing.
Public spending is to rise to clear some of the state copper mining company's debts.
Copper production fell in the last two months of 1999. Structural constraints and financial difficulties at the Food Reserve Agency have worsened prospects for subsistence farmers. The IMF has not yet reached a decision on resuming ESAF payments, but expects to make recommendations about debt relief soon. Higher copper exports could reduce the current-account deficit substantially by 2001. The recent sales of the ZCCM may have sidelined the issue, but the it still prevails.