This positive growth performance has been broad-based, extending beyond the recovery of the mining sector and withstanding adverse shocks, such as droughts and record increases in oil prices. In 2006, real GDP growth was largely driven by the mining, agriculture, construction, transport and tourism sectors. Last year, Zambia achieved single-digit inflation in 30 years. What were the main contributing factors to this achievement? Bringing inflation down to single digits has been Government’s goal for a long time. It is, therefore, pleasing to note that last year, inflation fell to its lowest level in 30 years. At the end December 2006, the annual rate of inflation had fallen to 8.2 % from 15.9% achieved in 2005 and was well below the target of 10%. This positive development in inflation was due to continued implementation of prudent monetary and fiscal policies, coupled with increased food supply. This was despite the persistent rise in oil prices on the world market. This year so far, inflation has been in double digits. What are the reasons for such a development? What is the outlook for inflation at end of the second quarter? During the first quarter of 2007, containing inflation pressures was a challenge. Inflation rose to 12.7% in March 2007, reflecting both higher food and non-food inflation. Higher food inflation was explained by increased cost of most fresh vegetables, typical during this period.
I am reliably informed that the number of branches has increased from 17 at the beginning of April last year to 55 at the end of November 2007. What is even more impressive is that these branches are found in areas which were previously not serviced by commercial banks. This indeed is a bold move and for this we must commend Barclays Bank Zambia. I am aware that the expansion programme is backed by a capital injection of approximately K40.0 billion which will make it possible for Barclays Bank Zambia to increase its services in the country, particularly to the SMEs sector. Ladies and Gentlemen, the 2005 Finscope Survey undertaken by FinMark Trust confirmed that levels of access to financial services in Zambia are low. Fewer than 15% of adult Zambians are reported to have had access to commercial banks. The reasons given for this low accessibility varied but some of the critical reasons included the distance to banks, the time spent getting to a bank and the cost of getting a bank service. With Barclays Bank Zambia opening branches closer to the people it is our conviction that the number of Zambians to have access to banking services will increase. We therefore encourage as many Zambians as possible to use these facilities. To the residents of Chilenje, I urge you to utilize the services offered by Barclays Bank, otherwise the bank may opt to close its branch due to lack of business and you will be left with no bank in your area.