The newly elected government is proposing to pull measures put in place to secure financial aid which could tip the scale against the nation. There's been a way of radical leftism overrunning all sense of rationalism in the EU and one has to wonder when politicians will come to their senses and realise that Europe is looking more likely to fail if it can't sort out it's financial woes.
Portugal in Limbo as Finance Minister Evokes Ghost of Greece https://t.co/kJccq9KeS2 via @business pic.twitter.com/fSRr66fpm4
— Joao Lima (@joaomlima1) November 12, 2015
I recall writing a blog post a few weeks back about the state of the African economy given the drop in commodities since most of the continents foreign income are derived from the sale of these much needed materials. At the time Zambian finance minister had presented a budgetToday it was the turn of the central bank as it began intervening in the foreign exchange market as the nation's currency, kwacha, hit an all time low this week against the dollar. I have to say I'm skeptical about this kind of action especially given the leveraged nature of forex markets. It's reported that the Zambian Central Bank has $3.5 billion in reserves but this certainly won't last.
If commodities continue to weaken it could spell disaster for the African nation who ranks as the second largest producer of copper on the continent. The government has implemented strict policies to try cut back the budget deficit it's facing so I can't envision seeing the economy getting better before it gets worse.
Zambia's kwacha strengthens by most in 7 years on central bank intervention https://t.co/9lW2wm8Dtj pic.twitter.com/6yd2PtfmXr
— Bloomberg Business (@business) November 12, 2015
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