ANALYSIS [Loan contraction and debt management:] BY Andrew Njovu


In the 2nd book of Kings Chapter 4 1-6 we read  that  the wife of a  man from the company of the prophets cried out to Elisha Your servant my husband is dead, and you know that he revered the Lord, but now his creditor is coming to take  my two(2) sons as his slaves.

V2. Elisha replied to her ‘ how can I help you?’ tell me, what do you have in your house”? Your servant  has nothing there at all, ‘ she said. Except a little oil”

V3. Elisha said ‘ go round and ask all your neighbors for empty   jars’. Don’t ask for just a few.

V4. Then go inside  and shut the door behind you and your sons. Pour oil into  all the jars and as each is filled, put it to one side’

V5. She left him and afterwards shut the door behind her and her sons. They brought the jars to her and she kept pouring’.

V6 When  all the jars were filled, she said to her son, bring me another jar, but he replied. ‘ there is not a jar left? Then the oil stopped flowing.

V7. She  went and told the man of God, and He said ‘ go sell the oil and pay your debtor, you and your sons can live on what is left’.

From 1996 to about 2005, Zambia was referred to as Highly Indebted  poor countries(HIPC).

Before then, Zambia had gone through the World Bank/IMF   imposed Structural Adjustment Program (SAP)  and these were years of social decay in this country, when people  were made to que or spend nights in the cold on a que so that, come next day, when shops opened, one would  be the first to purchase essential  commodities that had become very rare.

Regrettably  the PF  and  Hon Chishimba Kabwili appear to have forgotten that suffering the people went through and PF continue with  reckless borrowing, which they  justify with the rightriousness of their ideologies.

If on the other hand the PF  and Hon Chishimba Kabwili have not forgotten that suffering, then please for God’s sake stop referring to those of us  who hold different and divergent views as ‘ lunatics’ ( chainama as he put it). Gone are the days, when people were expected to think alike, to hold one political opinion, to dress the same, to glorify one political party, to dance to the same tune. Political multiparty  encourages holding of different opinions on issues and nobody has a right to call another holding a different view a                                   ‘ lunatic’.

On Monday 25th January 2016 the Hon. Minister of Information and Broadcasting and Government chief spokesperson Hon Chishimba Kabwili was in Kasama and addressed  a meeting at the Provincial administration conference room, during which he explained Government programs, but when discussing the issue of borrowing ,, he became very careless and continued referring to those of us who hold divergent  views  as “chainamas”.

During question time, the author responded to the issue of borrowing b y Government and told the Minister that’ there was nothing wrong in borrowing, but what is wrong was failure by government to put in place a mechanism for debt management and the author then asked the Minister what measures government had put in place to ensure that the country does not fall back into another debt trap.

In reply the Hon Minister said  the fact that Zambia was still able to raise loans meant that the country was still credit worthy and that there was nothing to worry about and then cited the example  of Zimbabwe who were not able to raise a loan to finance the Kariba dam rehabilitation  works and instead the World bank allowed Zambia to guarantee a loan  on behalf of Zimbabwe, which was done and  the  Hon. Minister argues and says,  this is sign of confidence, creditors have in Zambia. What Hon  Chishimba Kabwili  MP, forgets is that even in the 1970s when Zambia borrowed heavily, the country was credit  worthy , but still found ourselves  in a debt trap later on, because there was no mechanism of managing those debts prudently. Thank God,  there were  good Samaritans, who heard our cry and cancelled our debts .

The reasoning by the Hon Minister,  that the fact that Zambia is able to guarantee a loan for another country is laughable.

Does the Hon Minister know that Zambia, Zimbabwe and Malawi were at one time in that ‘ Federation of Rhodesia and Nyasaland’  and that there were common assets such  as the Central African Airways, the Rhodesia Railways, the Federal reserve bank, federal postal services and  that these assets have not been shared equally? These are some of the assets, Sir Roy Welesky was referring to, at Victoria Falls conference in 1962, when talked about “ preserving common services”.  These assets have not been shared.

Does the Hon Minister know that soon after independence DR Kenneth Kaunda approached Ian Smith over the issue of sharing assets and Ian Smith refused to discuss the matter? Does the Hon Minister know that  soon after  the Independence of Zimbabwe  Dr Kaunda again approached his brother President Robert Mugabe over the issue of sharing assets and President Mugabe refused to  discuss the matter? .

I  don’t know what President Chiluba did  about the issue of sharing assets. I don’t know what President Mwanawasa did about the sharing of assets. I don’t know what President Rupiah Banda did about the sharing of assets.

I don’t know what President Michael Sata did about sharing those assets., Indeed I don’t know what His Excellency the President Edgar Changwa Lungu has done  over the matter. But what I want to say is that Dr Kaunda really showed determination to resolve the matter.   Dr Kaunda  truly  loves this country. May God continue to bless him in his  old age. Thank God Dr Kaunda is still  alive and can be consulted over the issue of Federation of Rhodesia and Nyasaland  assets.

In the Bible passage that I have just referred to 2nd Kings Chapter 4 1-6, the woman whose husband  had left her in debt turns to Prophet Elisha for help.

His initial response may be  similar  to ours in Zambia when faced with issues of International debt which enslaves the poor nations. The issue of international debts is  essentially  the same as the one Elisha was asked to resolve.

The question Elisha  asks is ‘ shall I do any thing? And when he does, he looks to the small resources the woman already has. He brings in her neighbors to give a little help and then God responds to the situation by providing for the woman so that she can pay back her creditors.

In the same way we need to mobilize the small resources that we have, join hands together as a nation and face these challenges with one voice.  The woman in the Bible passage almost had her two sons sold as slaves, because this is what debt does.

It enslaves, it dehumanizes.  The Hon Minister may not agree with me because he already holds the view that those of us who hold different view on borrowing are ‘ lunatics’.

The little resources that Zambians already have is human resource, which we can use to establish institutions and create mechanism that will promote checks and balances and enhance good governance, so that we minimize on misuse of the little resources that we have.

So that we minimize on stealing of  these little resources available.  Poverty in this country which  stands at  65 percent, is an impoverishment caused by  unjust economic and political policies and structures and it is poor who are hit most.

In the language of the Catholic Church, “the poor deserve preferential  attention, because in them the image of God is obscured  and violated and for this reason God becomes their defender”.

According to the Ministry of finance the 2012 Eurobond was disbursed for investments in various public infrastructure  modernization program.

The treasury stated in one of their bulletins last year, that US$186 MILLION was allocated to ZESCO towards power generation projects. A further US $69 MILLION was allocated to the same company for power distribution  projects. US $ 120 MILLION  was allocated to Zambia Railways towards the procurement of infrastructure rehabilitation materials, rolling stock and acquisition of track rehabilitation and maintenance services.

US $ 29 MILLION was invested in the health sector towards modernization of third level and tertiary health service providers. The Development Bank of Zambia(DBZ)  was allocated   US $ 20 million  for support towards small medium enterprisers.

While the road sector was allocated US $310 MILLION OF WHICH US $ 145 MILLION WAS TO BE APPLIED ON REPAYING FUNDS BORROWED BY Government for the Lusaka Urban Roads Project( formula 10 prior to the 2011 general elections. The bulletin says the balance of US  $ 165 million was committed towards on going various road maintenance and upgrading works.

I want to applaud government for releasing  this information to the public because then you avoid speculation. I salute the government for releasing this information because it is then incumbent upon citizens to use such information in holding those institutions that benefitted for the Eurobond accountable. I salute the government because such initiatives add value to our governance record.

Let me end by encouraging Hon Chishimba Kabwili  MP to continue  calling us   any names, he prefers  ‘lunatics’ for holding divergent views from his, but one  day we shall be vindicated  either in this world or the world to come.

Categorized | Analysis

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