Chairperson, I am happy to state that “Banking on Health”, with support from the U.S. Government, has worked to address some of the barriers to credit by providing market research information on the private medical sector to commercial banks and microfinance institutions so that they can understand the business characteristics of the sector. The financial management training that Banking on Health provides to health businesses also lowers the risk of lending to these borrowers. Ladies and Gentlemen, let me end by pointing out that the challenges arising from the global financial and economic crisis are huge but surmountable. Major economies of the world are putting in place various stimulus packages, which are expected to take the world economy out of the crisis. Without doubt, these measures will benefit emerging and developing economies as well, provided that we remain committed to pursuing strong socio-economic policies. Although the global financial crisis has negatively affected the Zambian economy in many respects and presents serious challenges to maintaining the health of the economy, macroeconomic stability has been maintained. The Bank of Zambia has continued to monitor the global developments and take appropriate measures to maintain confidence in the banking system and avoid systemic risk. It is important to note that despite the crisis, there still remains investment confidence in the Zambian economy and one example of this is the number of new commercial banks that have commenced operations in Zambia in the last 12 months.

These service providers, whether they are doctors, nurses, midwives, clinical officers, dentists, or pharmacists offer their clients increased choices. More choices in health provision allow people to find the best care for their own particular circumstance and needs. The expanded choices and reach provided by the private sector is a wonderful complement to the existing public health services. Furthermore, the recent decision by the Zambian Government to designate Health and Education as economic sectors will undoubtedly, assist all investors in the health and education sectors. This entails that investors in these sectors can now enjoy the various incentives previously available only to investments in the real sector. Chairperson, In order for the private health sector to truly flourish in Zambia, it is vital that the government provides an enabling environment that will ensure that private providers of health services can obtain the financing they need to expand and improve their medical practices. Most micro, small, and medium enterprise firms in Africa, including health businesses, only receive 5 percent of their financing through banks, while larger firms get 22 percent of their financing needs from banks. In Zambia, a recent survey on financial inclusiveness indicated that only about one third of the population is financially served by banks and non bank financial institutions. Barriers to access to credits identified included; high interest rates, caps on loans and excessive collateral requirements. BIS Review 73/2009  1  The importance of increasing access of banking services to a larger proportion of our population cannot be overemphasized.