9.5 C
Alba Iulia
Thursday, September 24, 2020

Humble yourselves and seek IMF bailout-ZIPAR tells Government

Economy Humble yourselves and seek IMF bailout-ZIPAR tells Government


A local think has advised Government to approach the International Monetary Fund for direct budget support as a way of resuscitating the ailing economy.

Zambia Institute for Policy Analysis and Research says the year 2015 has witnessed the most dramatic deterioration of the Zambian Kwacha against major trading currencies such as the US Dollar, British Pound and the Euro falling by over 50% since the start of this year.

In a research paper titled the ‘Mystery of the Kwacha,’ ZIPAR notes that the IMF presents a better option for balance of payment support to cushion the Zambian economy which has deteriorated following the erosion of the Kwacha.
‘Indeed, the depreciation of the Kwacha is really not a mystery, although this sometimes comes as a shock to some people,’ ZIPAR says.

‘The currency has been depreciating for some time now. Between January 2008 and September 2015, the value of the Kwacha cumulatively fell by more than 108% against the US dollar. But in 2015 alone it fell very sharply by 51% against the US dollar. Even against the Rand, which many politicians claims was also in trouble in 2015, the Kwacha weakened markedly by 31.5% in the first three quarters of 2015 alone.’

ZIPAR said Zambia may do well to take pragmatic action and consider a return to IMF Balance of Payment support programmes as a short-term solution to emerging Balance of Payment and currency depreciation problems.

‘Of course, this return should be done as a well calculated move, with the authorities establishing a well-researched and well-consulted negotiation position,’ it said.

‘We are in a fix in terms of the amount of forex that we have and we don’t have a lot of options to generate more forex considering the headwinds we are facing right now, energy shortages and things like this, in that circumstance, you do need to reach out for help,’ it said.

‘Which is a cheaper option of finance, the IMF which offers balance of payment support or the Eurobonds from commercial markets? I would argue that it is the IMF.’

‘In a tough time going to get help from the IMF is not a sign of weakness or failure, it is a actually a sign of showing seriousness to addressing serious economic challenges. That is how the international community might help if you reach out to them, they might give you balance of payment support for example.’


  1. Edgar, a below average lawyer failed to amend the Public Order Act when he was Justice Minister (and Home Affairs Minister). For anyone to even think Edgar has the slightest understanding of why our economy is failing is dilusion of the greatest order and perhaps Chainama won’t save you

    • Reality has arrived and it is time to face the facts.

      Lungu has FAILED. 100% COMPLETELY.

      Zambia needs serious crisis management and it is clear to anyone with a brain that it is not going to come from Lungu and his PF.

      2016 will be too late. He must resign and call elections NOW.

    • – Weak erections?

      – Premature ejaculations?

      – Need more power?

      – Low sperm count?

      Then try the new and improved libido tea from Christine’s Health Shop.

      Deliveries throughout Zambia.

      Yes, stock is again available.



  2. On 3rd November,2015, I wrote a detailed analysis about why Zambia needs IMF bail out as a short term solution but as usual, some bloggers with little knowledge in diagnosing our economic problems and a one dimensional of view of our problems, criticised me. Since then, the following have supported my recommendation: Bank Of Zambia Governor,Edith Nawiki, Standard Bank Chief economist, many more experts and now the respected ZIPAR! Ghana was in a similar situation last year and they had to shallow their pride and ran to IMF for balance of payment support to save the CEDI from total collapse! The Kwacha and economy will continue nose diving as long as decisions are being delayed and made based on political expediency! The more the Government waits the more things will get worse! They…

    • @Kalima nkonde while I respect your opinion I would berg to disagree and bring solutions out of the box.i feel IMF will take us to the days of structure adjustment program, this will not help reduce poverty for poor of the poor. Here is the quick solution.1.Remove Edgar Lungu and let HH bring in new investment and grants from those who trust him.PF is not trusted by donors now hence they are with holding donations.2.Revisite entire Tax system in Zambia , by reducing tax and broaden it at the same time strengthening the law on with holding tax.3.Develop the Banking and lending systems to support production by Zambian entrepreneurs .4.open up the economy so as to attract liquidity to flow hence attracting cash and forex.5.Fight corruption in awarding contracts.This the way to go portugo has…

  3. There are elections next year. This will not happen. Remember that Zambia invited the IMF last year, but quickly booted them out because the recommendations were not politically expedient. Given that it is the same scenario, I expect Govt to bury its head in the sand and continue to blame ‘global external shocks’ and Satanism for our woes

  4. A balance of view id important to ensure a thorough analysis Any article on IMF will not be complete without mention the nature and method of bailout or Financing using SDR or special drawing rights

    It will be important to set the tone from the early development to current operations of SDR and how ZAMBIA fits in without any structural issues Look at the SDR interest charges and also how they are handled and traded and what rights Zambia has to mitigate its current and see ”weather”‘ its the correct way to go

  5. EL and the PF government have no idea what it takes to run a country and its economy. All the comments mentioned above are beyond their comprehension…they are so clueless that the big man has to look for devine intervention to sort out Zambia’s economic woes. Well dude, it ain’t gonna happen. Do the right thing for Zambia and her people and resign. Give others a chance to get this country moving forward in the right direction. PF has taken us in reverse for too long! Lets not forget, we are One Zambia, one Nation!

  6. you need a balanced view of IMF bailout digest it as ZIPAR and then issue a well researched paper on the Pros and Cons

    Zambia’s debt portfolio is not a foreclosure like Ukraine or the case it Was for India Zambia should not be compared to Greece Its has viable options Its not desperate of money We went through structural reforms and that slowed the economy and IMF policies tend to do that in monetary and fiscal restraint In as much as we Like the IMF the EFF is not the only solution to take Zambia out of the current its not true and correct Setting very tight monetary policy targets and build up or reserves to stock the IMF policies should be…

  7. carefully contrasted with the current Zambia scenario IMF is good but we expected a solid pros and cons taking the case of Ghana India Ukraine and other including Greece and see the after affect of the period to and from the bailout

    ZIPAR your conclusions are not correct and well researched Lets get back to the table IMF is good but know when the policies are good and get the best from IMF funding and ensure you arise like the India of 1990 that faced similar positions but do not say its only solutions its not correct

  8. Humble yourselves and seek IMF bailout…

    Not exactly impartial ‘advice’, when one of ZIPAR’s partners is… the World Bank. Is there a hair’s breadth between the IMF and World Bank… and Anglo-American De Beers and Rio Tinto – none. They are all influenced or even founded by the Rothschild barons.

    International Partners

    On the international front, ZIPAR has maintained collaborations with the United Nations University’s World Institute for Development Economics Research (UNU-WIDER) and Africa Centre for Economic Transformation (ACET) of Ghana.

    Our Partners

    African Capacity Building Foundation (African Development Bank, UNDP, World Bank)
    Bank of Zambia
    Economics Association of Zambia
    International Growth Centre (DFiD)
    World Bank – Zambia

  9. IMF might be the solution but if you’re in Lungu’s shoes, they are not the right solution now! IMF gives money with countless strings attached, the money actually comes wrapped in a spider’s web, with controls on who receives the money, how the money is disbursed, what projects are given priority, the mount each need has to receive, and here is the kicker, especially for the PF politicians, HOW WAS THE MONEY SPENT, ACCOUNTABILITY!! Therefore, in an election year, when Lungu has to be Father Xmas, IMF is not the solution he needs but unfortunately for Zambia, it is what we desperately need.

    • Unfortunately “accountability” is a concept that is beyond the capacity of Lungus brain to understand!

      That is why he has NEVER given a PRESS CONFERENCE to tell the people that pay his salary, the Zambian Taxpayers, what he is doing with their money.

      He thinks he has just inherited a fortune from a rich relative and can spend it as he likes. Charter a $300,000 airplane for a holiday in New York and go on holiday when Zambia has an emergency.

      And it is NOT EVEN OUR MONEY! This is money these swines have BORROWED in EUROBONDS in OUR NAME that they are helping themselves to! And WE WILL HAVE TO PAY IT BACK!

  10. ” ‘Which is a cheaper option of finance, the IMF which offers balance of payment support or the Eurobonds from commercial markets? I would argue that it is the IMF.’ ”

    And who invented the Eurobonds again?

    Rothschild Bank: “In the 1960s new avenues were explored. Together, the British and French banks committed themselves to further developing their new operation in the USA which was eventually to become Rothschild Inc. In London, N M Rothschild & Sons took an early role in the new Eurobond markets.”

    Google: eurbonds rothschild history


  12. It’s not the only solution though fiscal consolidation and reduction of debt in the long term is important but that should be over a carefully worked out time frame to ensure the economy continues without any slump as a result of those reduced spend on GRZ and often increased taxes to mountain the reserves without further debt It’s being BOX in the short-term How long the short term is depends on your definition hoping that in the long-term debt is reduced and taxes are reduced as reserves mountain making ABC less likely to default on those term sheets
    It’s generally though noticed that IMF policies tend to be contractionary and the effects in High…

  13. We know from documented incidences that the IMF relief has often been short-term There is need for a long-term ZAMBIA solutions after say 30 yrs even after the IMF carefully spurring the economy to that double digits You will not certainly in conditions like IMF register that desired super level of economic growth You will need to grow even after the bail out .

    The point to start is to look at the growth forecast in the IMF proposals and see the creation of incentives innovations amongst the people and employment creation utmost You will also need to observe that increase and accelerated growth is the only healthy means that will help you…

  14. realize potential revenues to fund repayments of those debts and quality of life for the people labour You will need to appraise the IMF bailout and like that and see over the long term what the outlook for Zambian economy will look like
    You may get the IMF relief but Zambia’s economic issues are chiefly structural in as much as we can see them cyclical resulting in recurring deficits on CA and always and if not calling for IMF or other debt solutions
    It’s important for Zambia especially having gone through the same route before to consider what is best case , Sometimes you will need flexibility and easy monitory supportive policies helping to lower the cost…

  15. cost of business-interest rates- and activate private sector investments including the taming of low inflation below two digits especially when the prices on those commodities come right
    That flexibility of Zambia might be carefully weighed to ensure any IMF programme are not very difficult to work side by side in the global economic outlook and avoiding locking in the potential and suffer the erosion of capital in debt now spend

  16. We will need to evaluate and compare IMF policies as in the results in IMF policies implemented in the Greek and Icelandic IMF programmes compared paying particular attentions to the structural issues weighting them to fit Zambia

  17. Mwalimu….I agree with you 100%. Zambia is a small economy and one of the easiest ways to reduce the countrys’ debt is for the government to STOP WASTING MONEY and channel the money to servicing the debt! That will be a big step in the right direction. Who in this current government can even understand what you have written above? EL…Kambwili…? I don’t think so! Whether you are a PF supporter, UPND supporter, MMD supporter makes no difference. We are all Zambians and if people in government are stealing from us and making life harder for us, why should they remain in office to enrich themselves? Come on brothers, lets stand together and fix our country. United we stand, divided we will fall.

Comments are closed.

- Advertisement -
- Advertisement -

Latest News

Lwandamina Reflects on Zesco United Departure

George Lwandamina has described his Zesco United exit as part of football evolution. Lwandamina left the eight-time champions by mutual...

Maize Smugglers abandon trucks at Mutenguleni graveyard

Two trucks laden with maize which was about to be smuggled into Malawi have been abandoned at Mutenguleni graveyard in Kasenengwa District in Eastern...

Government strives to improve provision of adolescent health services

Kabompo District Nursing Officer for Adolescent Health, Sondashi Bombwe says the health office is on course to implement programmes to help improve adolescent health...

Increase in Expectant Mothers Giving Birth at Home Worries the Government

Ministry of Health Permanent Secretary for Technical Services, Kennedy Malama has expressed concern on the increased number of home deliveries which may result...

AVAP backs on-line voter pre-registration

The Anti- Voter Apathy Project (AVAP) in Northern Province has welcomed the move taken by the Electoral Commission of Zambia (ECZ) to commence...

More Articles In This Category