UNITED States Ambassador to Zambia Mark Storella says the recent removal of maize subsidies in Zambia is justified because both the Government and farmers could have suffered serious financial repercussions in future had the trend continued.
Meanwhile, The World Bank says removal of subsidies will give the Government an opportunity to realign public resources to meet the country’s development goal of achieving inclusive growth.
Mr Storella said the Zambian Government had to make a correct and hard decision to remove maize subsidies because the country could not afford to keep subsidizing one crop at a huge cost.
He wished the Government great success in ensuring that Zambian farmers diversify by focusing on growing different crops besides maize to provide better nutrition and have steady incomes.
Mr Storella was speaking in an interview in Livingstone after he toured vegetable fields for Nsongwe Women’s Association funded by the United States Agency for International Development (USAID).
“I don’t want to comment on specifics of the proposals but I want to say that maize subsidies could not continue because soonner or later the Government could have gone bankrupt and farmers were also going to be bankrupt.
“You can’t just keep subsidizing maize forever. Your Government right now is making hard decisions on agriculture and it should be supported,” Mr Storella said.
He said Zambians should not just rely on one crop but it should embrace crop diversification to enhance food security.
“If you rely on one crop and suddenly there is a crop failure in a particular year, then you will have nothing to eat. I really wish Government great success. What we really hope to see in the future is that Zambian farmers will have more and different crops which will bring about better nutrition and better income,” he said.
Mr Storella said a long time ago when Europeans came to Zambia, they brought maize and most Zambians currently thought that it was a normal thing for everyone to eat maize.
And World Bank country director for Zambia Kundhavi Kadiresan said the removal of subsidies would allow the Government to realign public resources to meet its development goals of inclusive growth but would not in itself translate into poverty reduction.
In a statement issued in Lusaka yesterday, Ms Kadiresan said there was a consensus within the country that the Zambian economy needed to diversify from its dependence on copper and to tap the enormous potential of the agriculture sector.
“Some of the ways that savings generated through subsidy reform could benefit poor farmers include investments in rural feeder roads to improve access to markets, livestock disease control, small-scale irrigation, agricultural research and extension and other support for relatively neglected agricultural products such as cassava, tobacco, cotton, and aquaculture,” she said.
Ms Kadiresan said the public was rightly concerned that the savings need to be used strategically with the poor in mind.
She said there was need for the Government to communicate its intentions and spell out in concrete terms what the benefits for the poor would be so that the population was convinced and can hold the Government accountable.
Ms Kadiresan said in case of fuel the Government should work towards improving the efficiency of the fuel supply system consisting of fuel imports, transportation and processing saying that more competition in the wholesale supply of fuel could bring prices down at the pump as happened in the case of the telecommunication industry in Zambia.
Ms Kadiresan said a well thought-out use of savings generated by the removal of subsidies could not only mitigate the impact on the poor but also create opportunities for growing out of poverty.
Recently the Government made two policy decisions -removal of the fuel and maize subsidies to millers–with the stated intention of redirecting resources towards the poor.
This has generated considerable debate since the reforms have the potential to create significant impact on Zambia’s development and affect large sections of society.
The fuel subsidy has for years kept fuel prices artificially low and masked several inefficiencies in the wholesale fuel supply chain.
In 2012 the Government spent about KR 750 million on fuel subsidy and the estimated cost in 2013 would have been in excess of KR 1100 million.
The agriculture subsidies that account for more than 60 per cent of the agriculture budget have directed scarce public resources to two large programmes, FISP and FRA that together cost the Government over KR 2 billion in 2012.
And yet you were silent about the US university stuffing modified maize down the throats of kids in the village as some kind of guinea pigs for testing the creation of some Frankenstein product that was easier solved by teaching them to plant alternative vegetables such as pumpkins, carrots etc… Fair comment but the subject matter is maize, which as it goes was originally imported from the Native American food chain aside from where it already existed in Africa. What say you about testing American kids with the same porridge?
Subsidizing consumption is not sustainable, but we can plow a big chunk of that money & cushion agricultural production to make the basic foods affordable.
The USA like most other govts in the Western world do subsidize agriculture, hence food is not only readily available, its equally affordable by all.
We can do that for ourselves too.
As for the world bank, just like IMF, they have NEVER come up with programs designed to help Africa, but those that keep pushing us into perpetual depravity, disease and underdevelopment. We can do better on our own without these two monsters.
As I said fair enough. Doesn’t explain the silence over modified maize dna and experimentation on kids by US university. It is not the issue but it is an issue. Perhaps you prefer to wait for us to be given the instruction what the US thinks we should eat.
what would one expect from those satanist,,,off course they would support any measures to kill poor africans
Asright……
Kindly refer to the subject
You see, anything with World bank in it just sets me off and that is why as MMD we worked hard to get World Bank off Zambia’s back and now suddenly people want us to believe that they are an undisputed authority on how to look after our people and grow the economy.
LT, in fact this shouldn’t even be news. The removal of essential subsidy was crafted by World Bank. MMD rejected it several times and sad enough PF has embraced it. So why should it be news when WB announce that they support this?
And this US chap, he should learn to stay out of internal issues. Why can’t he remove the LOG in US eyes before pointing one in Zambia’s. What are entitletements in US? Aren’t these subsidies? Isn’t the US Bankrupt and printing dollars like crazy? Please SHUT UP, sir.
The US has subsidies in the following area and that is one of the battle ground between the Republicans and Democrats and am sure this US chap is a democrat and supports these subsidies in his country
1) Medicaid and Medicare
2) Unemployment Insurance Programs
3) Family Services
4) Energy
5) Economic Recovery Payments
6) Housing
7) Agriculture
All this information is public and from the US Government. Maize subsidy has worked and delivered unprecedented bumper harvest setting a solid trend that has earned us the envy of many and dropped inflation to single digit. These are facts.
Yes it has flaws and we can’t just throw it away. We need to fix those flaws identified. That is where our effort should be
Ubufi .. The MMD heavily depended on borrowing from the World bank ,IMF and later China . US Bankrupt ? Or you mean the budget deficit ? The people of USA are richer than the government and its middle class is the largest ,taxes remitted to the fedral government is quiet huge to even support lazy chaps in the streets who pretend to say they cant find jobs . In our case, the government is richer rich than the people ,and most people look up to the government .
@Luapula Fish. You are the dishonest one. MMD left the debt to GDP ratio at 24% one of the lowest in the world. This is one excuse Miles Sampa has been using to go and borrow more money. ‘We still have a lot of room to borrow’ according to Sampa because ‘our debt compared to our GDP is still very low’. So cut that crap about MMD depending on World Bank and IMF. Only Chiluba and Sata’s MMD depended on WB and IMF. Levy and RB administrations were professional.
The United States is in debt to the tune of $16 trillion more or less equal to its GDP. It has also been running on budget deficits ie it collects less in taxes than it spends. This is the issue that is preoccupying Americans today.
Asryt ! Thats the learned and well versed man when it comes to economics talking ! Thanks mr Sitole.
Really? What has Storella got to say on US farm subsidies? $3 bn in subsidies to Us cotton farmers? $4 bn subsidies to US Oil companies? Subsidies for home buyers through Freddie Mack? You are been screwed once again. Open your eyes. Yellow maize grown by subsidised US farmers in the Midwest will soon be making an appearance in your local Kantemba. My dear there’s free market in food production. The EU, USA, Japan , India China etc subsidise food production. Food is a national security issue. Its like an Army, you just have to fund it. If you can give 800 litres of free fuel to a leech why wouldn’t you give 4 bags of fertiliser to a self employed rural dweller to produce your food?
MMD Chief Bootliker you are just that. A MMD Butt-licker.
I think anyone can argue for or aganist removal of subsidies. What is critical now is how PF will ensure that these savings are effectively and effeciently utilised.
Dream on. The PF is just raising salaries for its bloated bureaucracy. Besides these are self confessed liars!
Well said , but the PF must ensure that these savings are directed to the poor people both in rural and urban areas. PF listen carefree, dont steal the money in the way MMD stole our money. What you must do is to plan well for these savings.
Peace and Prosperity to Mother Zambia.
Let under five and his dogs of war go ahead with the protests
Obviously, the pipo they wanted to impress have slapped them in the face!!
Thanks Mr. Storella and the World bank
Under five, go back to the clinic for those under five injections!!
The same World Bank together with the IMF and the Western governments that control them also advised you on how to privatise the mines. Today you’re still complaining about how you were short changed. When are you people going to grow up and learn to devise your own home grown policies that benefit your country. It is very primitive almost 50 years of independence to seek policy justifications from institutions that have screwed the country for half a century due to ill advised policy guidance. In 2003 the same World bank advised Malawi to get rid of its Maize reserve. A year later there was crop failure and Malawi said never again will they listen to foreign “experts”!
The World bank and Mr Storella do not vote. Mr Storella’s govt in the USA subsidizes Agriculture to keep the American population well nourished. Under the American Farm subsidy program billions of dollars are paid to Grain and Cotton farmers in order to make them produce below market price. This ensures cheap food for Americans as well as export markets. For example US Cotton farmers are paid $3 billion per annum in subsidies this makes them sale their cotton below the world market prices. The West African Cotton producers like Burkina Faso, Benin, Mali have been complaining about this. The EU , Japan, India also subsidise food production. Only a fool will leave food production to market forces.
Americans and Europeans are subsidising their farmers and hence spending billions of dollars on programes like the Common Agriculture Policy(CAP).
These subsidies have made it very difficult for Africans farmers to compete with the American and European farmers. The Zambia government needs to be very careful how it proceeds with this withdrawal of subsidies without damaging Zambia’s export earnings.
Subsidies need to be well targeted for them to be effective. Zambia has for along time been using subsidies to promote consumption and not production. One example is the money spent encouraging small-scale farmers to produce maize at a loss. Maize has been politicised and hence it is no longer a profitable crop. The whole agriculture policy has to be completely overhauled.
Another example is the fishing industry. One looks at the fact that ‘EU’ fish is coming from trawlers off the coast of West Africa while local fishermen struggle as the fish coming close to where their small boats can get to have dwindled drastically forcing them to try further out only to be pushed away as the fish in there ‘belong’ to the EU. Sad.
Lekeni fwebakweteko skopo tumilondowele mwebalefyuka kusukulu.Ala iyi muleufwa ati subsidy bane chintu ichikankala sana.Ala shilya indala ubuteko bwaleposa pukubika pamulu kuti chabombako nakuli fimbi.Ifyapala ukumipela umufundo, nokuwamya imisebo kufitungu mwikala.Kanshi bane mwilaumfwila ba politician nangula ntile ababa mufikansa fyachalo.Ngabaisa muletifye webo wechilema selela uko.Ala bwafya bane mumwene.Bulanda bushala.
Storella, please s.h.u.t up. Poverty mitigation is a responsibility of govt. Soon you will be saying no medicines in hospital. Pathetic.
I support the removal of subsidies on fuel and mealie meal because they are subsidies on consumption. However, removal of the fertiliser subsidy is a bad move. We are already facing a less than optimal harvest this year because the Govt bangled the delivery of inputs in the last season.
The other problem I have with the PF is the unnecessary deputy ministers we have. If the PF is calling for sacrifice, why aren’t they starting with this useless expenditure? I am very sure a lot of us will hardly miss the deputy ministers. And need I mention the bye elections?
This is why the subsidy removals are being resisted, in my opinion. The PF are calling for sacrifice, while we are not seeing any sacrificing on their part
It is about time we removed the issue of MAIZE out of the political arena as a campaign weapon. Let the govt use some of the savings to guarantee a market for other cash-crops as the buyer of the last resort. The same way govt has supported the maize market, it sure can support the growing of other crops to complement maize: Rice, wheat, barley, nuts, fruits, sugar cane, tobacco, tuber crops, millet, sorghum, sunflower (for cooking oils and soap), etc.
If farmers know their is a dependable market for such crops, I am pretty sure they will work just as hard to grow these crops as they have done with maize—and this is where the govt can act as a guarantor. Not just mealie meal for breakfast (porridge), mealie meal for lunch (nshima), and mealie meal for supper (nshima)!!
Also if I may say, countries like the USA and those Europe use farm subsidies for exactly this purpose—supporting farmers who might otherwise abandon the growing of certain crops, or raising of animals for meat or milk, because they are simply not profitable or economical undertake—which in turn leads to a rich crop diversification and nutritional base for the population. NOT just concentrating on one crop—maize!
So the removal of the consumption subsidies are well over due and welcome. The challenge now is to hold the govt’s feet to fire and make sure they do the right thing with the savings—this where the rubber meets the road!!!!
Its seems strange to hear a a highly placed American official preaching about equality and poverty reduction while the USA, one of the richest countries in the world, keeps millions of its own citizens in poverty and squalor without even decent basic medical support!! Yet they come to Africa and preach more of their elitist forms of capitalism. A strange world indeed!!
It is also ironic that the wealthy preach more poverty for the poor as a solution to ending poverty!! It is not increased poverty which will help millions of people, only ideas, constructive thinking and the appliance of strategic planning backed up by the appropriate level of short term capital spending to unleash the potential of the people. The world is awash with money looking for a place to be invested with expectations of a medium term return. Agriculture in Africa is always going to be there to create wealth and stability for all. It can be done, lets find the local and international resolve to achieve this objective!!
An additional benefit is that as an increase in Agricultural/pastoral activities will generate an increase in associated trades such as construction, mechanical, engineering, transport and logistics. As well as vetinary services, bio chemists, soil analysts, fertilizer production, strategic planners and managers etc. All of these associated business activities will be required to sustain a booming farming sector whose produce can sustain the Zambian people and also be traded as an international commodity to earn much needed foreign currency. To achieve this aim the young men and women of Zambia need to be enrolled into training programmes immediately to ensure the necessary skills base exists to commence the regeneration of Zambia as a wealthy nation among nations!!
PF promised more money not sacrifice ,we already went through this under the SAP it proved non beneficial to the farmers,business was bad in farming provinces,HIV infected Zambians need cheap food to meet their nutritional needs, this will come back to the same thing, more deaths ,more school drop outs,job losses due to bad business as a result high fuel prices,the list is endless.Let politicians lead by example,cut down on freebies from Government first,i.e free fuel,talk time,free electricity free water, cheap alcahol at parly ,sitting allowances etc.
Mark Storella is a useless chap, first he misinformed USA regarding ukwa and now he’s back wth this donchi ku-lie mentality. He does not understand the economics of africa. Obama should have recalled this chap long time ago, zambians will always remember him as a failure.
Removal of subsidies may be the right thing to do but the method and timing may be questionable in a country where government through public admnistrators does not seem to put its priorities right.Here is a simple example.With the excitment of the UNWTO in Livingstone,we would rather spend millions on landscaping the hospital and less on lacking drugs.More on the outside appearance of the museum and less on putting measures that would ensure its sustainability and the list of such examples is long enough to convince any ordinary tax payer to realy be outraged.Mind you when Chiluba came into state house the World Bank and IMF gave thumbs up to SAP.What did Zambians benefit from SAP?
Look who is talking. The US subsidizes so many sectors not to mention the welfare scheme which gives out food stamps and low cost project housing yet the country is deep in debt. Just the other year Obama provided a stimulus package and bail out plan for the automobile companies. Is the US really a pure capitalist country? Your answer is as good as mine.
Ha ha UPND now ni shut—————-up.We knew it that subsidies can’t benefit the poor or only rich millors who sell maize to other countries such as CONGO,ANGOLA and German for stock feed make feed.These guys buy at cheaper price then sell it to their own customers instead of selling to Zambian people at cheaper price.When govt open it’s own maize mills in districts these crooks will cry.
Ha ha UPND now ni sh***ut—————-up.We knew it that subsidies can’t benefit the poor or only rich millors who sell maize to other countries such as CONGO,ANGOLA and German for stock feed make feed.These guys buy at cheaper price then sell it to their own customers instead of selling to Zambian people at cheaper price.When govt open it’s own maize mills in districts these cr******–ooks will cry.
People saying America subsidises this and that for their people and hence Zambia should continue subsidising fuel and maize lack analytical skills. Americans have built all the infrastructure they need, like roads,rails bridges, you name it, while Zambia is still a bush. As a matter of fact if the Americans wanted they could just be eating and going to the toilet because they have done everything they need to do while we just sit an argue about nshima. Good move by MCS.
This is a lie, chicken. America has more bush than Zambia! Have you been to america lately?
i see no point in listening to US and the so called
world bank when making decisions in our own
country as if they consult us also when they are doing
so in their country.please can we atleast be independent
for once ba government!
listen to the people living in their country coz
they are the ones undergoing the problem ..every time its US
and other european countries controlling us! WHY?
Imwe baKolwe ba US envoy and WB…so you are behind Sata’s about turn from Sociolist Manifesto to Capitalist policies ???
Why should the Sata and his pathetic fools implement these removal of subsidies in an impoverished country such as Zambia, where as the US and other Western countries have subsidies in place to take care of their poor? This is hypocrisy to the maximum ! That is why you have food stamps in the USA and social grants in SA !!! Only African countries that follow foreign policies blindly will end up with RIOTS and armed REBELS in their countries !!!
Has the Socialist Manifesto aimed at serving the poor Zambian people by the PF graduated to Capitalists’ policies?
Tekweba ati fyonse balanda ninshi fyamano.