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Alba Iulia
Friday, April 30, 2021

When a nation is, ‘down and out,’ the IMF squeezes the last drop out of it

Columns When a nation is, ‘down and out,’ the IMF squeezes the last...

Hunt for Successor 42: Money is the root of all evil

Money is the root of all evil,” the email read. “It is the reason you Africans are a failure; a dependent of the West. It is the reason you languish at the bottom of the totem pole. Don’t blame us. You have put yourselves there. It is your self-interest, pettiness, and meanness that have put you at the brink of economic Armageddon. It is the greediness of your political leaders that makes you an endangered people.”

The lengthy email was from Walter, the Caucasian and former IMF official I had sat next to on my flight from Los Angeles to Boston on New Year’s Eve of 2011. I had not heard from him in months. I read on:

“It is this unbridled greed that is killing you at an alarming rate. It has turned you into beggars at the hands of the IMF-World Bank and condemned you to debt. The indebtedness, superior to colonialism, is the reason for the wanton deaths of African folk and the fast reduction of the African population. It’s a great shame for a people who have enough natural resources to feed, clothe and shelter every single soul on the continent.

A Sinazongwe fisherman with his children on Lake Kariba
A Sinazongwe fisherman with his children on Lake Kariba

Like children your so-called economists and your ill-informed politicians get excited when IMF-World Bank announces that your economic growth has ‘surged’ to 8%, 4%, 2%… What they fail to understand is such are insignificant percentages of low development. IMF-World Bank is simply putting cheese on its traps and like mice you all are getting caught. Where are the African economists to fight this scourge?”

Walter’s last remarks on African intellectuals steered a debate across Africa that has lasted up to today. From the email it was clear that he was still following closely the activities in Africa.

“I see your president has become a victim of IMF-World Bank placebos. He has removed subsidies on maize and fuel. I will address that later. Let me first inform your readers that I love Africa. I’ve left the New York “Vulture Fund” company I worked for when you and I met on JetBlue. It was too much for me. In 1999, I moved from the loan shark IMF to a broking company that was ripping off countries like yours by buying up the debt at cheap prices and demanding much higher than the original price.

“In 2007, we sued Zambia for $40 million, after buying off some of the debt for $4 million. Chiluba paid us $15 million, and we rewarded him with $2 million. We went to the Democratic Republic of Congo and did the same thing. Overtime, I became disillusioned. I was often haunted by the view from the bedroom window of my Kabulonga home back in the 1980s.”

For those familiar with Walter, you’ll remember his words: “I was part of the IMF group that came to rip you guys off. Your government put me in a million dollar mansion overlooking a shanty called Kalingalinga. From my patio I saw it all—the rich and the poor, the ailing, the dead, and the healthy.”

A LandRover finding its way through the flooded Njashishi Road in Kanyama Compound in Lusaka
A LandRover finding its way through the flooded Njashishi Road in Kanyama Compound in Lusaka

Walter reminisced: “The daily sight of funeral processions from Kalingalinga to Leopard’s Hill Cemetery have stuck to the walls of my brain—the sound of wailing, and solemn hymns. I have quit. I am no longer a vulture. I have now become a fighter for Africa’s economic empowerment.

“I’m a staunch supporter of Joseph Stiglitz whom I have always admired. I totally agree with him when he says that the IMF must be dismantled. Joe was at the World Bank when I was in Africa. The man has a big heart for Africa. How I wish some of your rational economists like Caleb Fundanga, who is familiar with the IMF, would take a leaf from Stiglitz and persuade your president to find a way of avoiding the IMF-World Bank high restrictive conditions and abominable interest rates that have brought misery to your people.”

For those who do not know Joseph Stiglitz, he is the Nobel Prize laureate in Economics who served as Chief Economist and Senior Vice President of the World Bank in the 1990s. In 2011, TIME magazine named him one of the 100 most influential people in the world. He is a guru at asset risk management, corporate governance, and international trade. The man was inside the World Bank and saw it all.

In a 2002 radio interview with Doug Henwood of WBAI, New York, Stiglitz was asked what struck him when he first got to the World Bank. The reply is quoted in full because it is the reason African states are stuck with IMF-World Bank for good.

It bothered Stiglitz greatly to discover that both the IMF and the World Bank were exploiting Africa. At the same time it bothered IMF-World Bank that Stiglitz had discovered their horrors and gone public. He was fired.

Stiglitz: “One of the most traumatic experiences I had there was just a month after I started. I went to Ethiopia, one of the poorest countries in the world. It had a balanced budget, no inflation, and had had rapid growth for five years, had cut back on defense expenditures from 6% to 2%, even though it had come to power through military means. This is a really unusual government – no charges of corruption. And yet the IMF had suspended its program.

“I asked, ‘Why?’ The answer was that the budget wasn’t balanced. But it was. They said, ‘But you shouldn’t include foreign aid.’ I said, ‘Why else are governments giving money if it’s not for them to build schools and hospitals?’ They said, ‘You can’t rely on it.’ The government had a very good answer. They said, ‘As long as we get the money, we’ll build the schools, and when we don’t get the money, we’ll stop building the schools.’ And when we came back to Washington we discovered that tax revenues were more unstable than foreign aid.”

It bothered Stiglitz greatly to discover that both the IMF and the World Bank were exploiting Africa. At the same time it bothered IMF-World Bank that Stiglitz had discovered their horrors and gone public. He was fired.

Walter writes: “I was in Washington D.C. when Joe was fired. Some African presidents and Finance Ministers celebrated. It was Joe who opposed the privatization of national assets. He was against high interest rates, and trade liberalization. But he was alone. Your president and your Minister of Finance disliked him. He was standing in the way of their commissions. They were making tons of money by associating themselves with the IMF and the World Bank. It was in the Washington IMF and World Bank offices that money became the root of evil. It was here that the “carrot and stick” game was played like Russian roulette. Ministers of Finance were staking their country’s assets for a commission and we kept winning, even when they shot themselves in the head.

“Now you know why the Ministry of Finance is the most sought in African countries. African Finance Ministers are the richest of the cabinet and are confidants of the president because they are the carriers of the begging bowl. Their best telephone call is the one from Washington D.C.

By the way, I was appalled, but not surprised when one of your junior ministers was quoted as saying “we will continue borrowing; we are in a hurry to develop.” Watch him. He’s drunk with power.
Deutsche Bank head of bond syndicate Nigel Cree (left) and Zambia?s Finance Deputy Minister Miles Sampa in New York on 13 September, 2012. PHOTO | CHIBAULA D. SILWAMBA | GRZ

It is this chronic borrowing that has worsened your county’s debt and increased poverty. A debt results in cutbacks in spending on health care, and is the reason people in your country continue to die from HIV/AIDS and poverty-related diseases. I have seen his picture; he looks chubby and is always smiling. I am sure he has a relative or two who are not as fortunate as he. If I had it my way, I would arrest him, lock him up, and throw away the key for mortgaging a country in which the majority are poor. He’s a half-hearted economist; an impetuous and selfish fellow.

“This is the type of foolish behavior I saw at IMF. The so-called African economists sent to Washington didn’t care how much they borrowed, at what interest rate. They didn’t bother to read the fine print. They did care if they flogged their electricity and water companies. They simply didn’t care about the poor back in their countries. It was what was in it for them and their president—period. And we didn’t care how much we dished out as long as we kept a country such as yours below the poverty line, and within the Heavily Indebted Poor Countries (HIPC).

“I began to lose respect for African economists, dressed, as they were, in their tailor-made suits, with golden cufflinks and draped bowties. Not one of these African Iscariots I met during my stay at IMF said anything negative about IMF; not one could see the drastic impact IMF and World Bank was having on their people. Not one could see that IMF and the World Bank were merely credit risk agencies.

“Field, how do you like the tag HIPC on your country? That’s what Zambia is and will always be—a Heavily Indebted Poor Country, that’s right. IMF and the World Bank love it. It’s a way of separating lepers from society. Your president, Chiluba, sold everything for a nickel and your country slipped to 164 of the 187 countries on the United Nation’s Development Index of poverty. You are still lepers, all I know. You are a country without an airline, meaningful mining and manufacturing industries, and now no subsidies—nothing. You are a country without health, education and development. Look at your dilapidated hospitals, schools, roads—just look at them. It’s shameful.

Patients sleeping on the floor at a ward in UTH
Patients sleeping on the floor at a ward in UTH

“When I read that your president had removed subsidies on maize and fuel, two reasons came to mind. The first is obvious; your president has no choice. He needs to maintain the IMF and the World Bank (your new colonial masters) seal of approval. Your country will not get help from Western donor countries without the IMF and the World Bank endorsement. That’s a smart way of keeping your country colonized, poor and dependent. If your president refuses to remove subsidies he risks having the extension of your country’s loans denied. This is what I call ‘loss of state sovereignty.’ Like you and other writers have hinted, when a country removes subsidies, it allows the market to determine demand and supply for food. This reduces support for farmers, and leads to the poor failing to afford essentials.

“The second reason is often ignored, but true. It is what Stiglitz calls the IMF riots. Stiglitz observes that when a nation is, ‘down and out,’ the IMF squeezes the last drop out of it. I dare add that the IMF-World Bank can be political at times. Don’t forget your president is not a very likable man in the West. They think he has become a puppet of China. He has been placed under the radar and is being watched. When you make the West uncomfortable, they will have you removed. The IMF and the World Bank know that when subsidies are removed, essentials will become unaffordable and people will riot. In your country maize and fuel are good dynamite with which to blast the ruling party. If they fail this time, I can assure you they will succeed next time.

“Joe is right. He’s speaking from his heart when he says IMF has failed. It is true IMF has purloined enough from poor countries, but, unfortunately, it is only Joe and a few like me who understand this. Your president and his economists don’t. We know that the West did not develop under such harsh conditions as those imposed on Africa. They kept subsidies for domestic industries. Your economists know this, and yet they can’t see that your country is being duped through monetary austerity; fiscal austerity; privatization; and financial liberalization. What a shame.”
Walter has spoken. I shall add no more.

Field Ruwe is a US-based Zambian media practitioner, historian, and author. He is a PhD candidate at George Fox University and serves as an adjunct professor (lecturer) in Boston. ©Ruwe2012



  1. I haven`t agreed fully with you but i should admit you have a very good case right there.I won`t even argue with you this time because i don`t see the point in doing so.Your article may not be that balanced but it is on the spot.Cheers man !!!

  2. This one country men is chocking unless you are an imbecile. I’m crying for the future on my beloved zed.

  3. Great piece of writing, sounds like metaphor but it’s clear and straight to the point, the actual truth.

  4. When are we going to stop blaming the IMF and World bank for our problems? We got into this mess ourselves. The IMF did not have a gun to our heads. The article is very bitter indeed. People have short memories. Zambia had a very good economy in the 1960s. It was the same as the GDP of Singapore. But were is singapore today? One of the newly industrialized countries whilst we languish in poverty and blaming others. The fact is that we destroyed our own economy in the 1970s and it never recovered from that. The author talks about debt being the cause of our problems. Well that has some truth to it in that if you are indebted you are at the mercy of your creditors. But who caused these debts to start with. Not the IMF or World bank. But gross mismanagement of the economy by local politicians

    • Continued….He does touch on privatization which I think was mismanaged by our politicians. Why because they were so weak. They mis managed our country and hence had no choice but to privatize. The principle of privatization in itself is a good thing for the liberalization of the economy. But it was done for the wrong reasons pa Zed. Elo there far too much emphasis on the IMF, LOANS etc. The only thing that will see Zambia develop is trade and FDI. These are the things that have changed countries like Singapore and Taiwan into the economies they are today. Simply blaming the IMF wont cut anymore. The guy in the authors article seems to be suffering from bitterness and anger. His analysis is not coherent

    • though what you say is true about the blame game, i think what the writer is simply bringing to light is the fact the we as a country are perpetuating the situation despite having the historical evidence of how fancy words like subsidy, monetary austerity; fiscal austerity; privatization, and financial liberalization, GDP growth and all the other crap that goes with it have been in the unmentionables of the already messed up economy as you yourself pointed out. may be the question he is asking as as a people really is do we really need to continue on this path. forget the 60s and who screwed up. the question is. What happens now and how is it in the best interest of correcting the mistakes of the 60s?

  5. I think the first thing we need is to accept that we are a poor country. We cannot be building stadiums when a good proportion of our people cannot have 3 meals a day and most people cannot even afford a decent hospital which has enough medicines and beds. Let us concentrate on improving education, health and freedom of thought and expression. Otherwise, we will keep flying to New York, Tokyo etc to beg.

    • Its sad. NO PRIORITIES what so ever. How can you be spending money on stadia yet fail to procure enough ARVs. How do you do that and say its ok. Have we no patriots anymore, who really have the heart for the people?

  6. Its back to Dmbisa’s thesis – Dead Aid! Really, when a peasant, deep in the village has problems, his first thought is not kaloba; he puts all of his energy and that of his family into solving as many of the problems as possible using HIS available resources. Only the things that are untenable without kaloba, are borrowed and even then he borrows at a price he can pay-back within one or two harvests. Its that simple – schools, food, health, security, peace, land and god’s weather – let the people get on with their lives and you’ll be amazed what they achieve – don’t hang this indebtedness collar on the “poor”, they know best how to better their lives, listen to them – no harvarding or cambridging, because then all roads lead into bank vaults somewhere in London, New York or…

  7. “In 2007, we sued Zambia for $40 million, after buying off some of the debt for $4 million. Chiluba paid us $15 million, and we rewarded him with $2 million……” Was Don Chichi still president in 2007

  8. Ati your junior minister!!! That bitterness I know you wrote this article coz IMF and World Bank support subsidies removal of maize + fuel .Go present your article to World Bank + IMF since you stay a dick miles apart…

  9. “We will borrow more to develop infrastructure (Miles Sampa)” Mongu stadium,new districts et al these are the useless decisions that cost a nation !

  10. I don’t think this piece contains anything new. There is alot of literature out there for anyone with an inquisitive mind! Hamann and Kapelus, Lungu and Mulenga, Fraser and Lungu, Situmbeko and Zulu among others will confirm all this, possibly from a different perspective!! This is not news!!!!

  11. This paranoia about the IMF-World Bank is just plain dumb! The the IMF and World Bank do not run the FRA and FISP in Zambia, they are run by Field Ruwes brothers and sisters in government (his fellow Zambians).

    In 2011 the GRZ budgetted K150billion for FRA but ended releasing K3200billion! a mind blowing budget overun of 1933%! Now, are you going to blame the IMF and World Bank for this criminal incomptence in running your affairs? Where did the cash to pay this K3050billion overun come from?…they diverted from other budget lines and BORROWED from local banks, NOT from the IMF and NOT from the World Bank!


  12. Lets man up and woman up and stop crying like spolit little brats!

    No body has forced us to have relationships with the IMF and World Bank Group.

    We are in this subsidy mess because of our poor decisions. We have seriously failed to reduce poverty: our poorest people live on cassava, millet, sorghum and wild roots which are not subsidised yet we spend trillions on subsidies!

    Its about time we took responsibilty for our own actions and inactions intead of always blaming others.

  13. Walter has not told us anything new. It is public knowledge that IMF policies have failed in almost all the developing countries, where they have been implemented. Reasons for this failure are very clear. The only thing that our Government does not know is that the West will never support a subsidy policy in a poor country. This is because part of the subsidies are paid for by their tax payers. If that money remained in the West then they would be under less pressure to provide for their citizens too. The way forward is for people in public office to stop STEALING and instead generate developmental programs that will benefit the poor. Finish!

  14. Like kalaki, we criticise.like micheal sata when he was in opposition he criticised.who is providing solutions.

  15. You will only be amazed by this article if you are seeing it for the first time. Same thing, only the approach changes. We are not kids. Lets own up and solve our problems as a nation and stop the blame game. We have a choice to make; to borrow or not to borrow. Talking of subsidies, you dont need an endorsement from IMF or WB to stop such a waste of resources. Thanks to the men who are so bold as to make such difficult and unpopular decisions. Lets see where we go after subsidies.

    • Felix, you say: “Lets see where we go after subsidies”.

      The destination is obvious: DEATH; mass starvation. Period!

  16. Another rubbish article from someone who consider himself to be a PhD material! learn to base your arguments on facts not hatred of individuals or the govt in power, individual governments calculate their economic growth of the year not the IMF or World Bank, they just go through the data which is available to other financial institutions and organisations and come up with their growth rate. Ruwe should be telling the truth about loans he is talking about, these Yugoslavian loans were sold illegally by one corrupt minister when the country disintegrated and many countries were formed. DRC refused to pay the loan to the American company, they asked the Balkan countries for information and the minister was arrested and the American company was barred from dealing in these loans.

  17. There was even a documentary about these loans on BBC and how the CEO of the American company which bought these loans was accused of acting like a mercenary and their claims were thrown out of court. They tried in European courts and failed and the last I heard, they were trying to use the courts at Cayman islands to influence the decision, but it failed. Chiluba was corrupt and every Zambian knows and he was MMD not PF.
    Ruwe does not understand economics, no government in the world can run without borrowing! Borrowing can also be internal it does not always mean the IMF or world Bank, alarming people about removal of subsidies is very strange for an intellectual, subsidies on consumption are never productive or drive development.

  18. Loans are intended for credible individuals or groups. When the credibility of a country is lacking, then start by restoration of credibility. Countries with credibilty honor their financial obligations. After WW II various countries borrowed in order to meet various infrastructure invetment needs. These countries repaid in record time. Here in Africa, certain countries have no loan arrears. Loan arrears cna be taken over by any credible government and get transformed into wealth. Economics and peace studies are two different things.

  19. Only few people have access to this online publications.And the beauty about this is that people reading article are all knowlegeable and can not be cheated.

    Go to the largest voter a villager.They will just chew your money,insult you and deny you a vote…because we are building the roads,hospitals and schools which they need most.

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