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Friday, May 14, 2021

Zambia signs for fresh loans from China

Headlines Zambia signs for fresh loans from China

Finance Minister Alexander Chikwanda
Finance Minister Alexander ChikwandaFinance Minister Alexander Chikwanda

The Zambian and Chinese Governments have today signed two multi -million dollar bilateral agreements to accelerate development in different sectors of the economy.

The grants are worth 183 million kwacha and an interest free loan of another 183 million kwacha which is to be repaid over a period of 20 years.

Speaking at the signing ceremony, Finance Minister Alexander Chikwanda said the signed agreements will help government accelerate the development agenda.

Mr. Chikwanda has expressed gratitude to the support China has rendered to Zambia’s development agenda since 1964.

“The agreements we have signed today have their origins in the desires of the two countries to attain meaningful development,” Mr Chikwanda said.

He added, “Under the PF watch with President Sata in power, we have to eradicate poverty in the shortest time possible and this will only be made possible with external support. May the relations between the two countries continue to flourish.”

Meanwhile,Chinese Ambassador to Zambia Zhou Yunxiao said 64 million US Dollars of the total amount will be used to implement projects to be decided by the two governments.

Ambassador Yunxiao said the provision of the two funds demonstrate how fully committed his government is to support Zambia in its social and economic development.

And the Chinese envoy also disclosed that Zambia will significantly benefit from the 10 trillion US dollars of exports to China from Africa in the next five years as well as the 500 billion US dollars that country will invest in the same period.

“The agreements are to provide two grants by the Chinse government to the Zambian government and these are to be utilised by projects to be discussed by the two governments, mostly likely on infrastructure development,” the envoy said.

“This is a new year present for Zambia from China,” he said.


  1. New years gift to the Zambian Youth from the PF government -MORE DEBT…..If you never lived in Zambia under Kaunda don’t worry PF has guaranteed you shall experience the 1980’s all over again! This time you will have to pay the debt, your future is being sold as you enjoy yourselves at Arcades!

    • Naimwe this debt is free of interest……GRZ will pay back the same amount in 20 years. Even me if I have a good plan for free interest money I can borrow.

    • @Truth hates – it must be people like you running the government today.Have you ever heard of inflation? I guess not. Case closed.

    • @Truth hates debt used for a constructive purpose is welcome. The worrying part in this case is that the projects to be financed have not even be decided upon yet! Does that make sense? How do you borrow first then decide afterwards what the money will be used for? How do you know if you are borrowing too much or too little in the absence of an investment plan? Worse still in the case the Chinese are going to have a say in how the funds will be utilized so there is no saying whether the the use will be indeed to the benefit of Zambia or will be serving Chinese interests at our expense

    • Debt Trap which we the youth will have to sort out when our time to govern comes, when all these old pigs are gone. o my, its frightening when u think of the rate at which they r borrowing.

    • “Chinese are far more intelligent than you are. So be careful, Sata tells new appointee”

      only a fool, knows what he is doing is wrong and does it anyway- Sata you know these Chinese are smarter than you and they are up to no good with these loans, but you are still signgig s.tupid i.diot.

    • “Chinese are far more intelligent than you are. So be careful, Sata tells new appointee”

      only a f.ool, knows what he is doing is wrong and does it anyway- Sata you know these Chinese are smarter than you and they are up to no good with these loans, but you are still signgig s.tupid i.diot.

    • Did we not tell you that you were putting F.OOLS in government….?

      While the world economy will be recovering you will be busy paying debts

      We will be watching you while enjoying a cold victoria bitter

    • @Ex-Moma. You are very right. These chaps are mortgaging the future of our grand children. In the meantime, they are busy looting to secure the future of their illegitimate children’s grand children.

    • @ Ex-moma, I couldn’t agree with you more. Alexander Chikwanda has not learnt anything from his first tenure as Finance Minister under Kaunda. The proverb “You can’t teach an old dog new tricks” is so accurate when applied to Chikwanda. This guy is busy raping mother Zambia and no one is restraining him. Can someone please stop this financial rapist.

    • Why accept a new year present whose monthly repayment rate ( in addition to many other debts) will equal or surpass your monthly salary? Doesn’t such a present give you a YEAR OF HUNGER?

  2. The next government will have problems repaying these loans. These guys signing the loans know that they will be long gone (dead) by 2033, so the future generation will have to bear the repayment burden. Expect higher taxes for the next 20 years.

  3. This is the same man that took us into serious debt in the UNIP era. He doesn’t see anything wrong because that’s his thinking stretch. The fact that we keep on bringing back the same useless and spent forces back shows how stu.pid we are as a nation. This is a bunch of leaders who do not understand the socioeconomic challenges of this century. Collectively, Zambians are failures, irresponsible for our destiny as a nation and plainly stu.pid. We need a complete overhaul and regenerated leadership if we are to move forward. Right now, we are a country of collective failures.

  4. Pathetic failures (PF) have doctorates in borrowing. Honestly these mangwams are selling us even our children and our children’s great grade children.

  5. This old ugly beast is endangering the future of our children.Why is the country so stupidly quiet and let him go on like this

    • Ukuteka ichalo kwalishupa bakaamba. Don’t insult, just put up your argument in a civilised manner.

  6. Debts and debts, yes debts, even America has them. We think that it will be easy to repay these debts when we take our economic activity to a higher level through improved infrastructure and investment.

    Well, this is government business, what about you guys at your personal level? You have loans from B Blue, Capital solutions, Izwe, Bayport, Microfin, ZANACO, Cavmont, Barclays, etc etc, Those houses and cars you are driving were bought on borrowed money!!!! The question is, have those loans helped you? If yes, then the government is helped by these loans from China and elsewhere. Just check your capacity!

    • @7Chikwanda ..debt in itself is not a problem so long it is used for constructive purpose such as acquisition of assets and investment. As you rightly said one has to check the capacity to repay when you borrow. But in this case these guys are not even able to say what the funds will be used for? Can we be certain that the funds will be put to good use and not just to finance expenses? At face value it looks like reckless borrowing.

    • Blabla, there is an indication that the money will most likely go to infrastructure development. Unless you think our infrastructure is OK. It may be power stations, roads, hospitals, universities etc. Don’t you need these? What is required is to determine which ones will help us achieve a higher level of economic performance, such that we shall even repay the loan easily. That must be our headache. Otherwise, we are not generating enough revenue for us to do a million and one things that we must do. If it is possible to raise our own money, tell me how, and everybody must agree with you. Not when a revocation on NGO import exempt you start crying! In the meantime you want more money to be paid to you…

      Happy 2014 my friend!

    • @Chikwanda-Galileo, You hit the point! Those are my thoughts too. I’m not seeing any other way for us to boost our economy at the momment apart from an expansive monetary policy (increase in our money supply). We do not need to worry about repayment as long as we strictly stick to our implementation plan and meet the targets of our development agenda.

      Actually, I think we are even better off borrowing from China than the IMF, World Bank or the ECB. I can cautiously predict from past experience that China is more likely to give us an outght write-off of our debts as compared to the other institutions which are reknown for the economic sabotage they have done to African countries.

  7. Grants are ok, but we have to be careful with loans!

    Lest we forgot so easily, for our next debt forgiveness Bono (love U2 music by the way) may not be around to intercede on our behalf. Be careful of the DEBT TRAP, this time from the EAST!!!

  8. When people advise you that things change with time u don’t listen. how do u appoint a 1970 chakuti accountant to be Minister of finance. those days it was normal to borrow without considering other options like the windfall tax he has at his disposal.

  9. And you call it “new year’s present”. Just how do some people manage to this like this? Since when was a loan a present?

  10. Quote from above “Meanwhile,Chinese Ambassador to Zambia Zhou Yunxiao said 64 million US Dollars of the total amount will be used to implement projects to be decided by the two governments.”

    I hope the ambassador was misquoted. There is a golden rule when it comes to borrowing; never borrow if you have not carried out an exhaustive expenditure plan. The impression being given is that we can borrow because the money is there to be borrowed. We shall be the losers because I am sure the lender has already worked out why they are ‘lending’. And I hope someone has worked out where the maintenance funds will come from for all these capital projects. Remember the potholes and dilpidated buildings- those old enough.

  11. The rate at which we are accuring debt is alarming. Hardly a week goes without signing a new loan. If these loans were to finance revenue creating projects then one would have some assurance that in time the loans will be paid back. Unfortunately, this is not the case. On paper, the loans are meant for something but used to fund consumables and perishables such as salaries etc. This is very short term and leading us back to a debt trap. To assume that revenues from the copper mines, which apparently have tax breaks, will pay off the debt is myopic. If these loans were being pumped into reviving and investing in manufacturing and industries that adds value to our raw products, then perhaps in future such investment would yield dividends.

  12. Interest free or not what is important is what you are spending the loan on and how you spend it. Which projects is this old man talking about? We all know a chuck of this money will corruptly end up in these crooks’ pockets via their companies.
    Fossil Chikwanda and Sata won’t be around in 20years hence the reckless borrowing. ..are you telling us we cannot raise $60 million from other sources?
    These selfish people are only interested about the next election and they don’t have vision for us and our children. Fossil Chikwanda is obsolete so are his ideas….we are not going anywhere with these people.

  13. Blessed is the hand that giveth, than the one that getteth! To those who think they gave little and need more, even the little will be taken away. Inkongole mwe Bantu!

  14. Nothing is for free! No matter how sugar coated it appear, there is a price tag of interest to it! People open your eyes of your minds this is not the dark ages! One day there will be a scramble for Zambia, only this time in the form of Auctioning!

  15. What we are seeing is looting at the expense of our nation. To understand what this government is doing, look at the tender procedures and the recent events with GBM. The government borrows money on the pretence it’s for developmental projects which is ok however, if you analyse the cycle of events which follow when it comes to allocating the money, it’s clear that the chief allocator “Sata” decides where this money should go. If hypothetically speaking the borrowing was to improve logistic in FRA, we now know that this money would go straight to GBM. Now multiply this by the bogus projects that this government has introduced? This is not only immoral but who ever forms the next government is guaranteed to spend the first year investigating and prosecuting while the country suffer.

    • What’s more laughable is the fact that these gullible people are now calling GBM principled….oh my god where were those selfsame principles when he was getting those GRZ contracts at inflated prices and eliminating genuine hardworking Zambian entrepreneurs from the tender process.
      Its just disgusting!!

  16. 20 years from now, it will be us the younger generation answering to the Chinese when they come asking for their money… Sata and Chikwanda will be long gone. It is sad that we can’t get money from our mines…. instead we are borrowing

    • Spot on. ..they know they won’t be there….these people have an average age of 68. There is no prudence its just utter recklessness and you don’t have to be an economist to see where this bus is heading to.

  17. Another loan — can someone tell me what has been done so far with all the other loans we have acquired in the last three years? What money-making project have we undertaken to make sure we CAN pay back these loans? Are we building factories? Are we investing in agriculture, industries, manufacturing?

    Probably not! We are most likely using it to for salaries and other expenses.

    Zambia will pay dearly for the few years PF will be in power.

    Brace for tougher times.


  18. Don’t you it’s time we as Zambians demonstrate against government’s reckless borrowing. Organize a protest or something. Black Friday.

  19. Debt is the new money, it depends which side of the table you are sitting at.
    USA, UK, EU, Japan are flourishing on debt. China at the moment has a local debt problem of US$3trillion. Ralph Emerson once said, a man in debt is so far a slave. And Nelson Mandela equally said money won’t make success, the freedom to make it will.

  20. PF is a party of Plunderers Forever.
    They plundered under Kaunda, chiluba, mwanawasa, rupiah and now plundering direct under Plunderer Forever Party.
    China is going to make 100% profit through projects that will be given back to its citizens. 20% is taken by Sata and his minions. Only 20% of the loan/grant goes to the project. Who is the beneficiary of such cheap money (if there is anything like Cheap)?

  21. Ba Fikala ba PF, who are you fooling, that money is going into your pockets 30% and to by elections 60% and intended purpose 10%. Dont just think of yourselves, think about the future of the country. We want our country to be as developed as western world countries.

  22. @19.1 Jay Jay, so true. We are gullible. Anybody and everybody comes, pulls wool before our eyes and we dance with blinds in front of our eyes.

    PF is the worst thing that can happen to any country.

  23. @ the loan will be used on projects which will be decided by the two countries: now my question is why get a loan and then you start to looking for projects;this does not sound like good planning its like now we are just borrowing for the sake of borrowing…borrowing should be done coz of identified areas which need serious attention not after getting the money you start looking for projects

  24. Sellout of Zambia continues,very well done,your children and following generations will have to suffer,isnt it sad????????

    • Add the $750m Eurobond to that…which is unaccounted for so far just disappeared in a black hole. Suddenly $120m which was sent to ZRL is enough meaning that there is nothing they are doing there just using the money to pay themselves hence the reason they are quiet.
      Zambians need to WAKE UP from their docility!!

  25. Are they LOANS OR GRANTS ba Lusatimes??? Please lead us into the new with classic journalism and not chair-nalism, PLEASE!!

  26. Atleast I have come to learn that no borrowed money is interest free.Its about the pricing of the loan Its like a discounted or a present value scenario One needs to look at the term structure and asses the other risks such as currency interest risk duration term including the discretion of Gov. to sorely pick projects without being pointed to by the financial because in it there could be a premium for the interest cost.Then the simple time value of money USD in relation to the kwacha also has an implicit cost especially the currency of borrowing to the kwacha.I simply allow my placed money to gain value by the rate in it my rate is recouped.


  27. Its not free money if the opportunity cost outweighs the borrowing Having discretion gives you leverage to invest wisely

    Again you borrow USD and need to raise kwacha to cover repayment.In it and in this lies the implicitly cost of funds borrowed but again the dictation to invest proceeds.

    The lesson is to analyze all borrowing on cost and benefit and settling for the most viable and cost effective option though bilateral better than commercial pure but its always a practice to look closely and carefully.

    Learning to understand the risk premiums that goes in the interest rate will make the understanding to see that its not free money and therefore prudence in utilizing it

  28. Do we really need to be borrowing? Don’t we learn a lesson ? Wasn’t it just a few years when we came out of the “Debt Trap”. Can’t we make do with what we have? Why do we always “deliberately” fall into traps?

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