The global financial and economic crises thus negatively impacted on economies around the world by adversely affecting trade and investment flows and the price of key export commodities. To respond to this crisis, several actions are being taken at global level by the major economies to address the root causes and the effects of the global financial and economic crises. These are fiscal and monetary policy stimulus measures aimed at boosting global consumption and investment demand in an effort to avoid a significantly sharper global contraction than that which has already occurred. Measures typically entailed reduction of interest rates, tax cuts and increased Government spending in form of bail-outs of strategic institutions and in some cases virtual nationalisation. Concrete steps are also now being taken to reform the regulatory and supervisory frameworks governing the financial sector. Further, increased resources have been provided to key multi-lateral institutions such as the IMF and the World Bank. These institutions have also been mandated to play a central role in leading the global response to the crisis and evaluating the efficacy of the various measures that are being implemented. Impact of the global economic crisis on Zambia The Zambian financial sector has so far not been directly adversely affected by the credit crunch as reflected in the continued stability of the banking sector with most banks being adequately capitalized and the inter-bank market operating as before. This is mainly due to the sector’s limited integration into the international financial markets.
Much in the same way, the Zambian private sector in general and Celtel Zambia plc in particular has the challenge of opening up to creditworthiness scrutiny and withstanding world-class due diligence by recognising and upholding good corporate governance norms of transparency, accountability and fairness. We are also aware that a formal sovereign credit rating undertaken by international credit rating agencies would not only further open up Zambia to global financial markets but also permit the appropriate reflection of our sovereign creditworthiness or risk premium in private sector financial dealings, which we believe is currently much better than generally held by both domestic and offshore market participants. In other words a good sovereign rating would improve the terms and conditions of international financial dealings for the Zambian private sector and businesses which could also be passed on to consumers in terms of affordable pricing and improved product quality. Ladies and gentlemen, today’s event therefore is an opportunity for honest introspection, though, this time not about the potential of our economy but about our own private and collective resolve of translating this potential into jobs, incomes and a quality life for all. We all need to recognise and  BIS Review 126/2006  1  understand that our commitment to upholding good corporate governance practices in both the public and private sectors and the resultant confidence and trust of our citizens, customers and clients be it in Government policies or private sector goods and services is inescapable for the long term health of both our society and businesses.