Finance Minister Alexander Chikwanda delivering the 2015 budget
Finance Minister Alexander Chikwanda

Government last night won the motion to increase the ceiling on external borrowing from the current K35 billion to K60 billion.

This means that Government can now borrow up to K60 billion.

The motion which went to elections in Parliament last night, saw the “Yes” getting 74 votes as opposed to the “No”s who got 41 votes while one vote was absent.

Finance Minister Alexander Chikwanda told the House that the treasury required additional resources to go towards financing some projects in 2015.

He said the funds could only be sourced externally to avoid high domestic interest rates and crowding out the private sector.

Mr Chikwanda said that the proposed borrowing would put the Government in a stronger position to deal with developments in the global and domestic economies which had invalidated some of the assumptions used in formulating the 2015 budget.

Zambia’ total public debt was still around 32.7percent and external debt was at 18.5 of the Gross Domestic Product, far below the internationally accepted thresholds of 40 percent.

Mr Chikwanda said Government was determined to maintain sustainable debt levels as it was fully aware of the effects imprudent borrowing can have on the economy and was mindful of overburdening the future generations with debt.

He said the external borrowing will be used to recapitalise state sponsored lending institutions which will support small and medium enterprises.

It would also go towards recapitalising Nitrogen Chemicals of Zambia to end fertiliser imports and Zambia Railways to equip and reinforce the railway system to relieve the pressure on the road network.

He said the Zambian economy was not at the verge of collapse.

But Opposition MPs urged Mr Chikwanda to withdraw the motion as Zambia was already faced with a debt crisis.

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57 COMMENTS

  1. Visionless PF!

    Very good at consuming but no production. Well, is Dr Kaseba’s accommodation included in the borrowing?

    PF BANDITS!

    The Skeleton Key
    ~206~

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    • In fact, PF has DEFEATED citizens in debt ceiling!

      13 months left till PF is democratically elected OUT. Visionless for sure !

      The Skeleton Key
      ~206~

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    • Now you understand why the PF government has been obsessed with nullifying opposition parliamentary seats, appointing opposition parliamentarians deputy ministers and continuously conducting violent bye-elections to win seats at all costs. It was to have a parliament with majority MPs who would vote with it no matter how absurd the matter it sought to pass through. It is not expected that the greed MP individuals would have empted the basket of their good life. Depressing!

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    • Bashi Bwembya, you’ll not be around when future generations will be burdened with high taxes in order to pay back this debt. You have been requested to explain to the nation your intended payback plan, but up to now you have not explained. Borrowing and Throwing money into these state owned companies without a strategy to run them competitively against their international peers is not the solution to their survival, it has been tried in the past and failed.

      These unethical PF MPs blindly support the motion because they will lose their jobs if they don’t. In addition Lungu wants to borrow to finance infrastructure projects so that he can use this as a campaign tool without a clue how it will be paid back and at the expense of future generations.

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    • IFISUSHI FYA PF they have put us in debt all because they want to win 2016 with plastic surgery/cosmetic urban roads.
      We will borrow again to maintain the roads.

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    • Mr Chikwanda needs several awards while he is still Minister and alive for the following honours: (i) Lack of vision and direction (ii) Arrogance (iii) Gross irresponsibility

      We are told for these loans, finance ministers get 10% for their signatures. So, how much has this DINOSAUR accumulated?

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    • With such voting patterns in parliament, the constitution must not be left for them to enact. The will of the PF govt will prevail instead of that of the people.
      It’s very clear that MPs don’t vote in the interest of the people they are representing in parliament, but to further their party agendas.

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    • Is that so…You have defeated us in parliament? We shall defeat you for sure on the ballot box… Cant wait for 2016…

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    • We are not going to be around in the next five years. Kufisenda senda fye elo mwaingilamo. Ubucushi bwabapina abatabakwete impiya. Bakashala balelila ifwe ninshi twanonka ninshi natuya mu diaspora. PF wabomba apa pena.

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    • Useless MPs why would they stay mute over such a matter. Oh I see I think most opposition MPs want Zambians to learn a lesson in terms of voting decisions. Do not say you were not warned and please prepare for onerous moments.

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    • This what HH needs to understand. He has no numbers in parliament that can help him govern with Authority. It’s about the MP’S.

      He wants to get into parliament with a revolutionary and populars entry.

      Even if he had won, he was going to find it frustrating to govern and change things. He only has 27 MP’S out of 152.

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  2. So only 115 voted. Can we have the list of the 43 MPS who did not vote?
    Also this is how the draft constitution will become toilet paper. Zambia, the real Africa…!!

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    • Indeed, “the real Africa” in anticipation of primitivism!

      They MOSTLY be voted overwhelmingly out. Stealing whilst it lasts, until 13 months left.

      BANDITS its what PF party is. Why is bandit Chama still “flee”? Lungu et al cadres of PF are shockingly MUTE on Chama’s PF S.G on the attempted murder of innocent member of UPND. So is Libongani’s police with the so anticipating NGOs!

      Otherwise the route PF has taken again, leads to FAILURES. Doing the same thing over & over expecting a different result is clear lack of experience. They never learn & only belly politics. Consuming without production is a high priority to suffering poverty.

      Be prepared for more hardships under visionless PF.

      The Skeleton Key
      ~206~

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  3. Rampant corruption. This manee will be waisted on allowances for this bloted Pf stealing machinery

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  4. Sad indeed! By the time the next budget is finalized, the ceiling will have been raised to K90b.

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    • Lungu and PF minions have a saying….’seleni tubombeko’ (step aside we work)….which as any sane person can say is really…’seleni twibeko muli corrpution and high borrowings’. (step aside we steal through corruption and high borrowings)….

      Because 80% of Zambia are poor and ‘uneducated’ in issues of debt etc, they will I bet you celebrate Lungu and PF for the ‘massive developments’.

      In Zambia, you can steal and loot and everyone will be cheering you right to your bank in Switzerland, Bahamas and other safe havens.

      This is the place where a person loots the treasury and citzen are in silent admiration and awe as they applaud the newly ill gotten wealth…! They even sing and throw themselves on the ground begging for crumbs!!

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    • A list of names who voted yes, no and were not in Parliament needs to be made available for people to evaluate who deserves to be re elected as MP’s (people’s representatives) in 2016. Re electing of MP’s should not be based on party lines but on character, ethics, integrity, morals, intelligence, having the interest of constituents. It is important that the voting records of all MP’s in Parliament during their term be made available to the public, including how the CDF funds were utilized in their constituency, these should be some of the basis of re election of MP’s in 2016 .

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  5. Some blind voters on the copperbelt, Lusaka, northern ,luapula can’t see this careless management and distraction of Zambia s economy just because their holding on to power. Can we all see the burden the country shall endure in the near future when chikwanda won’t be there.

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  6. Borrowing further to complete projects whose cost has been significantly exaggerated to finance corruption? In these government infrastructure projects, for example, a pocket of cement is being quoted at K300 instead of K75? At this rate we are borrowing our way back into HIPC and we will leave heavy debt burden on future generations! Since Parliament has failed to stop the increase in the debt ceiling, citizens must find a way of stopping it!

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  7. This is another example of mediocrity of Zambian Journalism: LT is reporting this important matter without any analysis of its implications at all. In fact they are reporting it as if it is a good thing! What a country! Disappointing!

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  8. This is the ironical power of numbers. They are creating a country of 1 million billionares and 14 million beggars. What a down trend? They are creating a huge burden to future generations and should be opposed at all costs. Money is not the problem, planning is the real issue.

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  9. This statement is the one that needs the most scrutiny out of everything that Honourable Chikwanda presented.

    ‘Mr Chikwanda said that the proposed borrowing would put the Government in a stronger position to deal with developments in the global and domestic economies which had invalidated some of the assumptions used in formulating the 2015 budget.’

    Can someone who understands our budget making process a bit better than I do, please explain what these ‘assumptions’ were that led to a gap of ZMW 20 Billion?

    We know that the revision of the mining royalty tax was estimated to have ‘cost’ Govt. ZMW 2.3 Billion (as disclosed by Hon. Vincent Mwale on 30 April), but what else has happened to lose ZMW 17.7 Billion??

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    • “…what else has happened to lose ZMW 17.7 Billion??…”

      ZMW 17.7 billion has not been lost.
      It is in “safe keeping” in private accounts overseas for post 2016 consumption by the accounts holders.

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  10. Shut up all you newly-found wise men! They kneeled for your vote and you gave it to them; so don’t pretend to be alot wiser now that the belt is about to snap your frail frames. Better get used to kneeling for good governance. The unfortunate truth in the tale is this: they’ll come kneeling for that vote again, and again you will thoughtlessly surrender it to them. How soon we forget – all of us!!! Fifty years of mediocre leadership and no lessons learnt. Shame on us -all of us. Politics will remain a dirty game for as long as all of us ‘wise’ men remain mere political commentators, cowering behind virtual names on these blogging sites. Tip as you vote: Any politician who comes kneeling for your vote is a cheat, kick their butt.

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  11. The concerns of a debt crisis are obviously justified but I think Mr. Chikwanda has become an easy target for the opposition.

    Allow me to be unorthodox – who, if not the Finance Minister will procure the finds needed to build our industries and improve our infrastructure hence assuring a better quality of life for everyone?

    I have observed how here in Germany opposition parties don’t just oppose any motion raised by the Finance minister in parliament but will rather hold the government accountable and ensure that money acquired from taxation etc. is responsibly put to use for the benefit of everyone. Maybe our opposition MPs should start to travel wide and learn how to play their roles better.

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    • Have you also observed accountability of German Government?
      No?
      Tray, and then you my be able to make comparison.
      How German Government is dealing with corruption of public officials?
      By the way, can you make comparison of German Minister of Finance and our senile jerk which has in five days transformed “budgetary short-fall” in to “investment requirement”?

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    • I like you observations. The difference between Zambia and German is that here we expect the whole of a president to oversee everything. What I mean is that we are able to see corruption by junior officers and we just look the other way round. Sometimes we even partake in these evil activities. Government starts with me not Edgar Lungu. It is my duty to say no to corruption. GRZ may procure loans for very noble intentions but along the line things will change course. During NCCM/RCM times councils were never given money by mines for projects but instead were given material and labour. Reason being that money was going to be used on frivolous things such as parties etc. Maybe this the approach we should adopt? Oh No they steal material and sell it.

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    • Ba Nine Chale,
      It’s not govt’s responsibility to build industries. That’s the work of the private sector. For infrastructure, yes I agree with you. The concerns we have is that the two Eurobonds for instance, have not been properly accounted for. The civil service is bloated, and most of this debt being accrued is going towards personal emolument. It’s not that our opposition just opposes everything, that’s not correct. There are many legislations which have been passed unanimously in parliament, including critical ones which require 2/3 majority. We tend to hear more of motions which opposition vote against because of the interest they generate and our media tend to give such full coverage

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    • Our opposition MPs dont even understand that you need to use other peoples money to grow your business. What Government is doing is very good because for the country to develop we need good infrastructure.

      The opposition had hoped that Government would fail to raise the funds and they would pounce on the issue and use it for campaigns that Government has failed to complete the projects. Now wapya munzi the opposition should find real issues to discredit the government.

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    • Sadly our MPs travel but batwala ok fye icimpwena and buying ill fitting suits which they were with the labels on the sleeves. Ubututu!

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  12. By the way, what are German interest rates on 10 years bond? 7%? No. 8%? No.
    What are interest rates on Zambian Bonds? 1%? No. 2%? No.
    What are Germans Banks Long term Lending Rates 22.5%?
    How on earth can you make comparison of German Government with a mess we have fallen in the past 4 years?
    Be serious

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    • You can compare in relative terms. Germany borrows for investments we can also borrow for investment. What is myopic is to think that you can build all the modern infrastructure using revenue from taxes then you would kill the local industries with taxes.

      We need the NCZ to be fully operational, if I had my way I would borrow to transform ZRL to run of self powered electricity rather than the diesel engines

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    • Sinazeze Bullet, electric trains. We don’t even have enough electricity to power our bulbs!

      The whole country is experiencing load shedding like never before.

      Please wake up and smell the coffee.

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  13. Borrowing is basically betting against the future generations. This is not a good move.

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  14. NB ba international market take this as official warning. all of you with fat wallets hide them pantu natwisa Nafuti Nafuti, umuntu ninkongole

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  15. PF is at it again. The money will be squandered again. I had thought we are independent nation to run our own affairs we are still dependent on western world. Why do we celebrate independence in Zambia? Please PF spare resources for the future generations

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  16. This is very sad indeed for our children these reckless old men wanting to borrow in their name!!

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    • Unfortunately, even are grand children have been enslaved by Pf reckless borrowings…..we their grand parents benefitted from debt right off under HIPC….I dont think these capitalist creditors (banks) will agree to a complete shave (total right off) let alone a modest hair cut!

      Why auction the future of our childrens children….mwebantu? For what?!!

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  17. This is catastrophic, our ability to inflict injury on ourselves remains unsurpassed! We should be awarded an Oscar price for gutless stupidity! Bukuba bwa bana ba Zambia bu tulile sikala!

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    • Bondate

      I agree with you.

      Whilst the PF borrowing will not affect me in my lifetime (I am a US$ millionaire with a robust and resiliently diversified portfolio in money market instruments, securities and rock solid real estate and wide array of business ventures), I dont like what this government is doing to our progeny.

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  18. This is destructive and irresponsible gvt. They have done more harm in 3 years than Kaunda did in 27 years. Please let’s not allow them. The more PF stays in power the more damage they will inflict on our motherland. Useless mps have shown why Sata called them as such

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  19. You can cry mweeeee. What I can do and where can I go?. Please help me before I get very depressed.

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    • You are yet to cry more. This has passed lets wait for the Retirement bill…it will also pass and we shall just be looking. I wonder what the youth of this country is doing because all this affects them. Imagine their future. I have been working for over 26 years now and when the retirement is increased it will mean an additional of 11 more years . So when will the others work? Youths work up to the unemployment …

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  20. is there anything to win here? This a matter of livelihood affecting 13 million people and not a game to be won or lost

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  21. This is why our country is so rich with resources and still one of the poorest…because they are using it as collateral to borrow money to line up their pockets and use to stay in power. Crooks!

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  22. The biggest problem we have is ignorance and indifference. Some people just have the knowledge to understand such complex issues like how government debt affects thier price of mealie meal or bus fares. Then you have those that blindly follow follow follow! THE LUNGU. Follow follow follow! Follow Ah Lungu! Mpaka mumu folo!
    Follow Follow Follow
    FOLLOW “AH LUNGU”
    NAMU NKONGOLE!
    FOLLOW AH LUNGU.

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  23. Everyone is depending on borrowing to make dreams come true; i.e. to build – proper building, u need a loan, so what more with a government? In Zambia, it is a common behaviour for members of the opposition to oppose anyhow even where there is Plan B. If they came in power today, where are they going to dig money for free for developmental projects? Most of the financial problems this country is facing today are due to wrong decisions that were made by pervious governments many years ago. If this is the way to go, then let us go this way instead of starting to languish. Even if there was a new President in Zambia today, he will need to borrow to operate efficiently. It looks easy from outside to be a government but it is not like that inside. So do not just crisis anyhow.

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