THE International Monetary Fund (IMF) has backed Government’s plan to impose a freeze on wage increments in the civil service for two years, starting next year.
IMF resident representative Tobias Rasmussen said the wage freeze is timely due to the significant increase in wages for public service workers recently.
Mr Rasmussen said the “huge” wage increase should be able to sustain the affected workers during the said period.
Briefing the press on the latest IMF report on Zambia, Mr Rasmussen said Government is in a good position to defend the impending wage freeze due to the significant increase in wages this year.
“IMF directors welcome the authority’s plans to freeze wage spending in 2014 and limit the cost of agriculture subsidies,” he said.
And the IMF contends that the current policy on mine taxation is reasonable and only needs to be enforced.
He said there is no need for a policy shift such as reintroduction of windfall tax, adding that the current system is sufficient and only requires adjustments.
Mr Rasmussen said the IMF believes with increased productivity, expansion and enhanced tax collection, the country will significantly benefit from the mining sector in terms of revenue.
On the 2014 budget, Mr Rasmussen said Government should ensure it makes significant efforts to ensure the set targets are met.
Meanwhile, the IMF has welcomed the country’s strong economic performance over the past decade, which is underpinned by prudent macroeconomic management.
The report however notes that the outlook is subject to significant risks from the recent widening of fiscal imbalances, reduced external buffers and volatile copper prices.
The IMF has since recommended containing the fiscal deficit, accelerating public financial management reforms, strengthening external public financial management reforms and improving the business environment, among,other things.
The report states that there is need for comprehensive policy action to address unsustainable fiscal position following the spike in wage and subsidy spending.
IMF has further called for strengthening of public financial management through improvements in budget planning, fiscal reporting, and expenditure controls and debt management coupled with strict oversight and accountability.
“Strengthening debt management and project assessment capacity is critical, given the planned rise in infrastructure spending and recourse to non-concessional borrowing,” the report reads in part.
IMF has advised against issuance of the proposed sub-national Eurobonds in favor of sovereign bonds and have stressed that all external borrowing should be subject to project appraisal and screened for consistency with macroeconomic stability, among other things.
Fat cats shut up! This whole IMF thing is just a scam trying to prove its relevance in poor countries,in Europe you yokels have no voice,
we are fed up of bye elections, poor governance characterised by killings massive borrowing for things like climate change whose agenda is not properly defined in terms of selecting households beneficiaries.
So, Mr Imf, we are also requesting your noble govt to reduced it cabinet size, stop bye elections, stop borrowing, reduce our taxes etc.
If govt promise that we will accept wage freeze, failure then we shall up in arms.
Take you pick and inform your wife Ms wobank
The IMF played a major role in ending Kaunda’ s political era. If Sata is not careful, he will also fall victim to this. I just hope his advisors shall take a careful study of some the IMF proposals before accommodating them.
The IMF played a major role in ending Kaunda’ s political career. If Sata is not careful, he will also fall victim to this. I just hope his advisors shall take a careful study of some the IMF proposals before accommodating them.
They are back.
That is what happens when you go to sleep as a government. We have borrowed too much money when we could have claimed our own from the mines.
It’s now no more money in our pockets.
…”the wage freeze is timely due to the significant increase in wages for public service workers recently”.
At the end of two years from now, we will have concluded that the pay-rise was just to appease civil servants and PF voters.
Why don’t they say wage freezes for the top leaders (increased TWICE) after they came to power, the extra Deputy Ministers (in some instances THREE) in the ministries, etc?
Ee mwandi!
Who the f..u.c.k gives these c.u.n.t.s the authority to speak in our affairs.. they speak too strongly and we seem to take their every single suggestion as gospel…Ka Rasmussen rep of IMF iN Zambia can he himself take a wage freeze…We must learn from history these white man organisations military or financial have always caused turmoil in Africa, theirs is to see us broken, they have their own interests and we re not a part of their interests in our own country and the continent.. we have a duty to decipher, learn and discover what exactly is their main interest in our nation and continent, and henceforth work against it severely, our survival depends on this…don’t trust white men!
We are the proverbial “puppet on a string”!
PLEASE NAME ME A SINGLE COUNTRY WHICH HAS PROSPERED UNDER IMF GUIDANCE. The collapse of the cashew nut industry is one example where they failed abysmally. It is run by school boys, straight out of university, who do not understand the situation on the ground…. where they purport to be experts….SUCH AS IN ZAMBIA.