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Chibamba Kanayama attributes fall of Kwacha to declined export revenue

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kwachaRenowned Economist Chibamba Kanayama has attributed the national currency, the Kwacha, to the decline in export revenue.

Mr Kanyama says in his weekly analysis of the economy obtained by ZANIS,that the fall in the export revenue is due to copper mining sector, capital flight from portfolio investment in government securities and the capital market.

He also attributes the Kwacha’s fall against other convertible currencies to the high maize import levels in recent months as well as speculative behaviour.

The Kwacha has depreciated by over 60 percent just in five months. The free fall may be 100 percent within a few weeks.

The fear now is that the depreciation may continue until maize supplies stabilise in June, donor inflows start and investors begin to respond to government securities.

” The latter is very serious because a number of individuals and institutions are buying and hoarding the dollar in anticipation of further depreciation,” Mr Kanyama says.

He advises government to restore economic confidence as a matter of urgency so that people do not irrationally speculate on currencies.

The local economist argues that as things stand now, the value of imported goods and services has astronomically increased.

He says that what has already been experienced is a sudden rise in the price of goods and services as producers seek to pass on this cost to the consumer.

” Because of the depreciation of the kwacha, Zambia will not enjoy the reduction in the price of oil on the global market. If anything, the Energy Regulation Board may soon hike the price of fuel to protect some margins of profit for oil marketing companies, ” he says.

ZANIS/MM/ENDS

114 COMMENTS

    • This Economist Chibamba Kanayama knows that we know what he is talking about!
      Now what next? You are right asking !!

      These guys can not even feed a nation and expect exports to go up? Someone should explain this to the Country.

    • Ba Doc imwe!! I konw it when you greet me!!

      Awe this guy is out of his mind. Should we start importing economist sure?

      Akabwali for the people first!! Then you can export whatever and wherever.

  1. Same stuff out of their mouths everyday!!!! But what are they doing abou the situation… These guys never get tired talking…. They should come up with measures that will ever cushion us whenever and however… Same issues being analysed but of what good to the common man!!! Each time there is been this problem same solutions being advised!!! i am sure these guys move with text books!!!

  2. Has the Zambian govt factored in the economic situation in DRC and Zimbabwe in trying to find out why the Kwacha is on the downard spiral? The dollar is the legal tender in these two failed states. Since their economies have collapsed they have no legitimate means of getting hold of dollars. The most plausible way to get dollars is from neighbouring countries like Zambia. The homework for the Zambian financial authorities is to determine how much Kwacha is being held in these countries and how much of it is fake. Morgan has paid out salaries to civil sevants in US$. Where did Zim lay hands on dollars since no Aid has yet been dished out. Watchout sleepy Zambians!

    • Morgan got his mulla from SA, the west rebuffed his aid requests and he took his begging to SA who so far seem to be forth coming, pls lets address our own incompetancies before we finger point pls,
      US$ being legal tender in Zim could a blessing in disguise for us if we up our game the right way

    • Morgan got his mulla from SA, the west rebuffed his aid requests and he took his begging to SA who so far seem to be forth coming, pls lets address our own incompetancies before we finger point pls,
      US$ being legal tender in Zim could a blessing in disguise for us if we up our game the right way

  3. Accountants reject Mmembe’s invitation
    THE Zambia Institute of Chartered Accountants (ZICA) has said that Zambian Airways shareholders have no authority to invite members of civil society to investigate alleged financial irregularities surrounding the airline.

    ZICA president, Chintu Mulendema said in an interview in Lusaka yesterday that only the creditors of Zambian Airways had legal authority to ask an accounting association to investigate the matter.

    Mr Mulendema said it was only qualified auditors appointed by a legally formed institution that could ascertain whether there was truly fraud in the finances of Zambian Airways or not.

  4. Mr Mulendema, however, said that the creditors of Zambian Airways were at liberty to ask ZICA, which would in turn appoint auditors to investigate the accounts of the airline, which suspended operations last month.what the Zambian Airways shareholders are doing to invite the Church, civil society and others is wrong. “It is the creditors that can invite us for a forensic audit of Zambian Airways and not what the shareholders are saying. What the shareholders are saying is not right,” Mr Mulendema said.

    The ZICA official said that it was the creditors of Zambian Airways who were aggrieved and they were the ones who were at liberty to invite ZICA to conduct an audit although such an…

  5. The ZICA official said that it was the creditors of Zambian Airways who were aggrieved and they were the ones who were at liberty to invite ZICA to conduct an audit although such an exercise was very costly.

    “As ZICA we are ready to appoint an accountant as long as the creditors are willing to fund the audit. It is not something that can take a day. It is an expensive undertaking,” Mr Mulendema said.

    Southern African Centre for the Constructive Resolution of Disputes (SACCORD) executive director, Lee Habasonda said the civil society did not have the capacity to investigate matters surrounding Zambian Airways.

    Mr Habasonda said that the civil society could only rely on…

  6. Mr Habasonda said that the civil society could only rely on investigations by the investigative wings.

    “I do not think that civil society has the capacity to investigate this matter. Our role is to ensure that there is transparency in the investigations,” Mr Habasonda said.

    Transparency International Zambia (TIZ) president, Reuben Lifuka said that although his organisation had not yet responded to the invitation by Zambian Airways shareholders, the organisation was of the view that the final decision would be made by the investigative wings.

  7. “The decision as to whether to participate in the investigation will be made at the board meeting next week. We have received an invitation but we have to look at it during the board meeting,” Mr Lifuka said.

    Mr Lifuka said that organisations like TIZ could only complement the efforts of the country’s investigative wings.

  8. Ba Kanyama! Vizungu vanu sometimes! Awee. Nagu nimwebo ba Economist. Sometimes you tell us the obvious. Ati “renowned Economist”? Te bufi ubo? Renowned shani?? Jam@co is a renowned bloggist, but no one appreciates him. Baby C is a renowned Bloggist, abena Zoe, Rashid..they are all renowned fimo fimo. No comment nomba.

    • I think it’s better to have sensible contributions which can assist us to find a way forward as a nation than the syndrome of PHD.Chibamba is a renowned Economist, one who has been even the SG of EAZ. Zambians whats your problem?

  9. Bushe bane , nshakwata experience, nganaya na degree elyo na masters ndepwisha mu december, is it easy ukusanga inchito? Ine umwenso wakubwela ku zambia , mwe !

    • Live rates at 2009.02.23 17:07:33 UTC
      1.00 EUR = 7,056.67 ZMK
      1 EUR = 7,056.67 ZMK 1 ZMK = 0.000141710 EUR

      Live rates at 2009.02.23 17:09:33 UTC
      1.00 GBP = 8,068.38 ZMK
      1 GBP = 8,068.38 ZMK 1 ZMK = 0.000123941 GBP

      Live rates at 2009.02.23 17:10:33 UTC
      1.00 USD = 5,540.00 ZMK
      1 USD = 5,540.00 ZMK 1 ZMK = 0.000180505 USD

  10. Renowned what?.Has Chinyama won a Nobel price?.LT you should be serious on some issues.The guy is busy saying the obvious ati renowned economist.Awe twakana.

  11. If zambia can’t feed itself what do you expect to the $s?It’s the only useless country which fail to feed it’s people with such a good agriculture environment.
    Another reason is that zimbabwe is stealing our $s trhrough Rb.It’s Like Rb is maiking money through selling our dollas.Chafake chi RB.Hope he makes a plan soon.Fuel is cheap now therefore i can’t see why kwacha is depriciating.

  12. Is Chibamba the only economist in Zambia,why is it that he’s the only one quoted in the Zambian press on a regular basis,i find it quite odd but he’s doing a good job though.

  13. The government is busy trying to sort membe and company at the expense of stabilizing the economy. Just look at George Kunda his busy trying to defend Dora, he has never tried to tell us anything about the economy because he has no solutions.

    How are you ba MOZE longtime

    • Am ok Mumbi. Long time indeed. Just these words LT keeps using. Ati, “Renowned”! Sure, of all the Economists we have, Kanyama should be Renowned? If he had said Renowned Broadcaster, maybe!

  14. Chibamba Kanyama, your analysis lacks in-depth. It is so basic to say the least. It is not even researched.
    What then are your recommendations after analysing the causes of kwacha depreciation?

    • I agree with your comment. Basically depreciation of a any currency results from reducced proceeds from exports,other factors like speculations and expectations may also play a role . We need more specific information on depreciation of the Kwacha especially from the Economists from BOZ and MOF.Chibamba Kanyama and World Bank have predicted the country ‘s GDP to grow more than last years record basing their expectation on revenues from tourism and Agriculture .This is so contradicting and also reflecting poor Monetary Policy from the current administration.From the current economic conditions the country is facing and the world economic crisis ,FDIs are likely to slow down to a record low.

    • How are you Man? I have just been told that I should let you know that the wedding wont take place as we planned earlier.I also dont know the reason why it has been called off.Let you know the letest.

  15. Kibamba Chanyama ‘the success story’ is always advocating for people to be self employed when he himself is formally employed.His deterministic approach to predicting the fate of the kwacha has failed us for so many times.How do you use a deterministic model to predict probabilistic situations Mr economist?.

  16. Can Chibamba Kanyama please concentrate on selling beer and leave the economy to those who dedicate themselves to economics and finance.

    With no exchange controls and no monitoring for forex entering and leaving the country we are basically subsidizing the entire region. This is the only country in the region where a Zimbabwean can enter with chocolates in the morning and leave with dollars in the afternoon.

    For our currency we must put measures in place to monitor and hence enable us to pre-empt shortage in dollar supplies. At it stands at the moment, the Kwacha is far too volatile it falls and rise at will.

  17. Have you now seen what you have done Kanyama? Ba kulu bakulu ba bwela manje. Vizungu wavinvela?? Stop telling us the obvious. Am not an economist but its obvious that what you are saying is true. Plain and simple! Banzako bapasa ma solution, not theories! Waba akali jacketi! Indeed, just sell castle, mwe!

  18. Ala kwena LT you have upgraded the site mwe. Guys be carefull with your comments have you seen how LT puts it now.Ati nsonso says.Martworld mulishani mune?

    • Never, because the dollar is not ‘real’ money. It is printed by the non-governmental organisation called the ‘Federal Reserve Bank.’ If you want to know more research Pres. JFK’s executive order 11110 of 1963. He was killed 6 months after he signed this.

    • Its children that trouble us on the way to School here in Delhi… They are friendly children… Hope you understand me!!! But have now changed the picture and waiting for the system to effect the change

  19. You chaps who are teaching Economics at unza have disappointed me. How do you let the so-called “Renowned Economist” deceive the nation with his weird, outlandish ideas. His objective is to market himself to unsuspecting organisations, trying to appear in the media every day. This “kama small meat” (kanyama) should be stopped at all costs.

  20. Dear bloggers Chibwamba Kanyama is a broadcaster because all I know is that he has never been in an economics class. Does he even the formula of inflation? Lets be serious. we have too many masquarades!

  21. You are all just speculating. Dont try to explain things you dont understand Mr. Kanyama. Solutions to these problems are more welcome than myopic observations.

  22. I thought I read Fundanga and the Finance Minister said dollar supply is more than dolla demand, and that the main problem is speculation and hoarding.

    What shall we believe, who is telling us the truth?

  23. I am often amazed how economists are always giving their observations as to why this and that happened but never the solution or preventive measures. The former Chairman and CEO of ZCCM was always giving excuses as to why ZCCM was underproducing, year on year! No solutions only observations. He would announce ‘measures’ only to see them fail the next year and then blame something else. Why ever did KK keep those guys in office for such a long time with poor results? Now, I have de-javu!

  24. Tighter controls of exporting US dollars out of Zambia by corporations have to be introduced. Our exchange system is so leaky that any small moves in the currency markets negatively affects the kwacha. A stable kwacha is key to any sort of development and planning, therefore we have no option but to introduce much tighter USD flows outside the country.

    • Its very possible. It is quite easy for businesses to transfer millions of USD out of Zambia as long as they are a legitimate company. So can easily send funds to Zim or wherever they have branches. Our money laundering laws are one of the tightest in the region, but the money market laws are just too porous. Hence the pressure on the kwacha is unlikely to be due to illegal siphoning, but due to restricted donor flows of capital, and increased exporting of USD out of Zed.

  25. Dear Friends,
    I am very pleased about the comments I have read. Someone asked me to read them. I know the argument has alwasy been whether or not I am an economist. The media has given me the name. The CV is on my website and it is not a secret. You are free to read it for yourselves or if possible, consult my former lecturers, Dr. Caleb Fundanga, Dr. Situmbeko Musokotwane, Prof. Seshamani or the Univerasity of Reading where I did my MSc in Development Finance. The solution to the Kwacha depreciation is in the statement pasted on my website. About over-appearance in the media, I should admit it bothers me too! Very difficult to avoid both the local and intenrational media.Thanks alot.

    • I am shocked that Chibamba actually has a website with pictures of his wife and children on it!! To me that is very unprofessional and not neccessary. My brother, you are sending the wrong message to the world – one of vanity. Be content with who/what you have without feeling the need to advertise your person. Less is more.

  26. Guys, ma jealousy fye! chibamba was in class with my cousin Chriticles Mwansa, ZRA Commissioner General. ali na double-major Mass Com and Economics.

  27. Iwe muleke eka chibamba kanyama; ifwe tuleumfwa bwino ifyo alelanda. In fact ali pa high demand. CK tuma nafimbi – we want more.

  28. chibamba, nice you wrote back. don’t worry we love you and whta you are doing. If you read this again, please need your email. I will phone Zambrew tomorrow and will introduce myself as Contact. please, am desperate to meet you.

    • Live rates at 2009.02.23 17:09:33 UTC
      1.00 GBP = 8,068.38 ZMK
      1 GBP = 8,068.38 ZMK 1 ZMK = 0.000123941 GBP

      Live rates at 2009.02.23 17:10:33 UTC
      1.00 USD = 5,540.00 ZMK
      1 USD = 5,540.00 ZMK 1 ZMK = 0.000180505 USD

  29. Live rates at 2009.02.23 17:07:33 UTC
    1.00 EUR = 7,056.67 ZMK
    1 EUR = 7,056.67 ZMK 1 ZMK = 0.000141710 EUR

    Live rates at 2009.02.23 17:09:33 UTC
    1.00 GBP = 8,068.38 ZMK
    1 GBP = 8,068.38 ZMK 1 ZMK = 0.000123941 GBP

    Live rates at 2009.02.23 17:10:33 UTC
    1.00 USD = 5,540.00 ZMK
    1 USD = 5,540.00 ZMK 1 ZMK = 0.000180505 USD

  30. I listened to Fundanga and Economic Association President a Dr something on Pheonix news today. the same rhetoric on the Kwacha. If anything, both were reading Chibamba Kanyama statement. is he their teacher?

  31. this fake econmist. he did mass comm and Development studies. hes not qualified to give advice. hes a con artist. will you ask an aids activist to prescribe arv’s? he’s just a quack

  32. I often wonder whether chibamba is comfortable selling beer as a’ born again’ christian when I see how often he is quoted in our media as a ‘local economist’. Take your pick my brother and decide here and now or forever hold your tongue…

  33. Chibamba? Thats the problem with economics and social science….always explaining using the obvious ” COMMON SENSE”

  34. If Kanyama is a renowned economist as he claims,he should not explain the causes for everyone knows,instead he should put forward proposals that will solve the crisis.Chibamba is very reactive instead of proactive.Renowned My foot!

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