Movement for Multiparty Democracy (MMD) President Dr. Nevers Sekwila Mumba says that the Patriotic Front (PF) government is about to waste One Billion Dollars of tax payer money because of their stubborn insistence to keep Zamtel as a parastatal and borrow $300 million to recapitalize it.
Dr Mumba said poor Zambians for decades into the future will be saddled with the $1 billion bill because the government may need to compensate LAP GreenN for nationalising Zamtel and to maintain the
loss-making parastatal’s inefficient systems.
Dr. Mumba said that the PF government did not follow proper procedure when nationalising Zamtel in 2012 and have not compensated LAP GreenN who paid $257 million for the company and invested a
further $170 million. LAP GreenN has sued the Zambian government and claimed damages of $480 million. In addition, he said the Government may have to bear its legal costs which could potentially run into millions of Dollars, especially if LAP GreenN are awarded costs in addition.
“It is absolutely shocking that within a year of grabbing Zamtel, the PF government made sure they turned a profit-making enterprise into a loss-making company such that they have now been forced to borrow $300 million to recapitalise Zamtel, and this is on top of various loans they have already obtained from the local commercial banks, also for Zamtel. When we discussed this issue with my Economic advisers, we were all astounded at the sheer magnitude of this wastage.
“The forced re-nationalisation of Zamtel, exacerbated by the deportation of key management staff such as the former CEO Hans Paulsen, dealt a huge negative blow to investor confidence which had been built over 20 years under the MMD,” Dr. Mumba said.
Dr. Mumba said that if government loses the court case, the $480 million compensation will have to include interest for 5 years at the Bank of Zambia average lending rate of 11% per annum. He said this amounts to over $700 million since PF are not likely to sell Zamtel before the next elections. He said that the $300 million loan the PF government is planning to obtain shall be another Eurobond which shall attract interest of 9% per annum.
He said if this loan is paid in 5 years, the total repayments shall amount to over $400 million, without counting other loan arrangement costs which in themselves can run into millions of Dollars. He said the total figure comes to almost $1.2 billion, without including legal fees for the court case. He said Zambia’s recent credit rating downgrade could potentially make the figures far worse.
Dr. Mumba said $1 billion can build ten modern hospitals with one thousand bed spaces or five General hospitals like the University Teaching Hospital. He also said the money can build 1,000km of roads, a distance comparable from Livingstone to Ndola.
He wondered how any sitting government can be so irresponsible to waste so much money for their selfish political reasons. He said the final impact on Zambians will be terrible because there will be less money for schools, hospitals, roads and other important projects.
He noted that the declining Zambian economy under PF will make the impact of the $1.2 billion very huge, especially when the repayments for the other three Eurobonds which total $3 billion are factored in. He said he expects the PF to do the only thing they know which is to borrow the $1.2 billion in another Eurobond issue.
Dr. Mumba said the Zambian economy was built on a foundation of free markets and vibrant private sector, of which the MMD were the architects and builders. He said that 50 years of Zambian history has demonstrated that governments tend to run parastatals inefficiently which is the reason only 7 parastatals are profitable out of 42.
He stressed that the role of government is to provide the right regulatory framework and investment climate to ensure that all companies perform well. Dr. Mumba said the PF will find it hard to resist siphoning out part of the $300 million loan to use for campaigns next year.
Dr. Mumba holds a Masters Degree in Public Policy and Governance that includes modules in Economics from Regent University in Virginia USA.
This is “Greek” to our government. We need to up the ante by constitutionally demading that those who run of parliamentary elections must be holders of degrees from internationally recognised universities. The current available crop of parliamentarians that could make informed Ministers to run government is far too limited.
You have that Mwanakatwe failure running Zamtel, what do you expect? Him and his wife have a pending loan at CEEC since way back. Is that the kind of CV that inspires? Running Zamtel is not being a TV star. Airtel & MTN are profitable, one wonders why Mwanakatwe has not been fired?
I think Dr Mumba is beginning to make a lot of sense. I know I always criticise him for leaving Victory ministries to join politics. I really think that preaching was/is his thing. However, I would rather vote for Dr Mumba than PF.
Dr Mumba is a man of moral character that is one of his strengths as a candidate.
Nevers e fintu. This government has failed economically. It is now K9 to a dollar. The debt levels have gone up. Investor confidence at its lowest and the ernegy industry mismanaged. Zambians let us wake up. The decision we made to oust the MMD was in association with the failures of RB. Now he is back again in a suttle version to complete the plunder. The MMD as a party had both the competences and vision while PF was clueless. MMD ni minds wa khale, siuvutha kulima. They know how to plough and they can sekwila. Go Nevers Go. You’ve always carried the image of a leader. Ndi nthawi cabe.
Well the govt is missing the whole point of running Zamtel, the problem is not the money but the people running the institution. You cannot have cadres running the institution and getting orders from people who understand nothing about managing such an institution. Zamtel has the potential develop and advance across the country and even create more jobs. But the current crop of managers running the institution have no clue and injecting more money in the organization will only create more nkongole than solving the problems.
Share waste of a pastor really
Sheer or share
This is what opposition politics is about. Offering wisdom. Nomba ni Nevers!
This man is talking sense!
Unfortunately the ears of those that should listen are deaf.
The corrupt clowns that should rethink Satas stupid decision to grab Zamtel are too busy filling their own pockets to do what is right.
The utterly Lazy Bum Edgar just signs off cheques, the bum is in Namibia celebrating that country’s Hero’s day that is the second time he is flying there in 4 months…you would think his in-tray at State House is empty.
No matter how much money PF throws into Zamtel the inefficiency of the company will not change. You do not solve money problems with money.It’s the attitudes,behaviour and perceptions that have to be dealt with.It really should be illegal to allow a few intellectually challenged individuals in government to plunge the whole country into debt and to squander colossal sums of money we just don’t have.
Mumba thinks that he’s a great man. He thinks that he’s Michael SATA or Simon Mwansa Kapwepwe. He’s jus a fallen preacher and a failed politician who needs to repent of his sins.
Sadly, there is some truth to that.
Why is Nevers so eager to return ZAMTEL to Lap green? Has he been promised something?
cadre-rised mind
On this he is very right. Reinvesting in ZAMTEL is throwing good money after bad. It wont change anything. the crisis at ZAMTEL is too deep to be fixed by money. The money will be wasted on more marketing campaigns and nothing of any substance.
On this he is very right. Reinvesting in ZAMTEL is throwing good money after bad. It wont change anything. the crisis at ZAMTEL is too deep to be fixed by money. The money will be wasted on more marketing campaigns and nothing of any substance.
Wow!! Doc Mumba speaking sense!
Thank you Nevers for publicising this issue. I hope the government will hear you. There is no point for reinvesting in ZamTel. In these difficult times, PF is better off admitting a mistake was made and try to resale it. After all, that was Sata’s doing, it doesn’t have to be pinned on Lungu. If he is brave, he should do this.
Nevers has spoken sense but some intellectually challenged idi0ts can’t make sense of what this man is talking about and hence stup!d comments. I still maintain my suggestion that it should be enshrined in the new constitution that only people who have attained Grade 12 level of education should be allowed to vote. These kaponya cadres who understand literally nothing actually extend our suffering! They can’t even explain why they shout, ‘ifintu ni Lungu’!
We are in deep trouble, if they borrow $1.2bn just to pay off the Libyans that will bring total external debt from PF direct borrowing to $4.8bn. This is pure disaster and the so-called journalists must be asking the President at the airport when he’s leaving or arriving (since this is where you can only see him) about these serious issues.
The chap will answer we are within our credit worthness and walk away to the plane! What a joker.
The chap will answer we are within our credit worthness and walk away to the plane! What a joker!
On this one i agree with Nevers zoona.PF should do something about the zamtel issue, otherwise we will lose a lot by funding that failed project. If we go by ba sata policy, in the near future , it will be much more difficult for the economy.
Were are those bottom feeders who were against selling ZAMTEL and applauded grabbing it back on security grounds???.
The “security grounds” were to stop the Zambian Watchdog from exposing all the PF lies Sata was telling Zambians.
Can Lungu allow us Freedom of speech?
PF winning elections will cost th country more than a Billion dollars and THAT is what Lungu calls”DEVELOPMENT” !!!!
Imwe leave Dr Mwanakatwe, how else do you think he will help his wife pay the CEEC CEO loan, be compassionate please he is your fellow Zambian, let people eat, just tighten your belts until you snap in two.
Why can’t some investor just buy Zambia? We are getting tired of all this nonsense! Everyday all we hear is government borrowing. Meanwhile the dollar/kwacha exchange rate is going through the roof. The country us failing, load shedding 8 hrs. And in typically Zambian style we have accepted it. The same with this ZAMTEL story
If you post something please check through after an hour or 2 to see how stupid you are. People vote and some ***** always get negative chakuti but they are still here wasting their time and resources. Dr Mumba has spoken sense on this one and only a fool can disagree with what he has said.