Government has assured the International Monetary Fund-IMF that it will realign its expenditure to counter fiscal pressure arising from current macroeconomic challenges.
Secretary to Treasury, Fredson Yamba said that government recognises the need to ensure a cost reflective pricing of fuel arising from the depreciation of the Kwacha.
Mr. Yamba said that government also wants to contain pressure associated with electricity imports.
He was speaking during a joint press briefing with the IMF team.
Below is the statement made during the briefing
For Immediate Release
PRESS STATEMENT BY THE SECRETARY TO THE TREASURY ON THE IMF STAFF VISIT
STATEMENT BY THE SECRETARY TO THE TREASURY, FREDSON YAMBA ON THE IMF VISIT TO ZAMBIA
Members of the press
During the period 11 – 20 November 2015, the Zambian Authorities hosted an IMF Staff visit to Zambia. The main objective of the visit was to review recent economic developments and share views on appropriate policy measures to address the current macroeconomic challenges.
Ladies and Gentlemen
The Government shares the views of the Mission and fully acknowledges that fiscal consolidation is paramount in ensuring sustained macroeconomic stability, growth and poverty reduction. The Zambian Government recognizes that risks remain and mainly relate to the need to contain fiscal pressures, particularly those related to the following:
1) costs related to electricity imports should weather conditions continue to be adverse;
2) attainment of cost reflective fuel pricing, following the steep deprecation of the Kwacha;
3) increased spending on subsidies partly due to the depreciation of the Kwacha; and
4) the need to complete ongoing infrastructure projects.
Members of the press
The Government further takes cognizance of the fact that fiscal consolidation is inevitable to support the attainment of monetary policy objectives. In this vein, Government will ensure that:
1) It re-aligns expenditures to counter some of the pressures outlined above. This is in view of the limited scope for new revenue measures and the challenges in the mining sector; and
2) It limits its borrowing in the domestic market with the objective of addressing imbalances in parameters such as lending rates and availability of credit to the private sector.
Government will also regularly review budget implementation with the objective of taking other corrective policy actions. The Zambian Government will undertake consultations to define the forms of further engagement with the Fund.
The Government would like to thank the Mission Chief, Mr. Tsidi Tsikata and his team for the fruitful discussions during the visit. Special thanks also go to Ms. Chileshe Kapwepwe, Executive Director, Africa Group I Constituency, for her supportive role during the visit.
Ladies and Gentlemen, I thank you.
PF BORROWED AND IMF IS WORRIED WITH THE MONEY BORROWED FROM MANY LENDING ORGANIZATION, LIKE EURO BOND, IMF, ETC. IMF GIVES MONEY OUT WITH HIGH RATES NOW THEY HAVE REALIZED WITH THE FATE OF KWACHA MANIA, THEY HAVE TOLD THIS PF GOVERNMENT A LOT OF CONDITIONS WHICH WILL MAKE EVEN A BABY IN THE STOMACH TO TO SUFFER.
BELIEVE ME YOU, IMF WILL NOW PUT PF GOVERNMENT INTO SLAVERY MAKING IT HARD FOR ALL CITIZENS NOW. DID YOU KNOW THAT FUEL VERY SOON WILL INCREASE BEFORE ELECTIONS?
So Ba Yamba, you sound like you were sleeping and you have have just woken up. If you needed IMF to tell you about this we might as well have elections tomorrow.
A competent government wouldn’t need an IMF mission to realize the policy weaknesses highlighted in the Statement above. All competent economic managers know that you must get your monetary policy and fiscal policy right at the same time. Didn’t PF realize that instigating by-elections in the manner they did amounted to fiscal suicide? Didn’t PF know that while infrastructure development is essential implementation needed to be funded properly and not in the manner it has been funded with most of the project costs being exaggerated? PF needs to eliminate the haphazardness it has introduced in our country. It also needs to keep its cadres under control! Are we waiting for the IMF to point out that PF Cadres are now more powerful than the police! What a country!
So you had to wait for IMF to caution you on reckless expenditure? Many zambians have been cautioning you day and night on reckless expenditure, but you have tagged them ‘bitter’. Tell IMF also that they are just ‘bitter’. PF has no direction. We are waiting to hear the full details of the conditions IMF gave you.
If you read between the lines, fuel prices have to be raised.
When the ZKW was stable and global fuel prices were tumbling, PF did not pass on the price drops to the consumers, their middlemen were enriching themselves.
Now there is no money to steal because of the tumbling ZKW, lets see how they explain this one at election time.
Someone senior at the Ministry of Finance signed a forward contract on the supply of fuel which locks fuel supplies to Zambia at a price of over US$120 per barrel when the world oil prices are below US$50 per barrel! This scandal needs to be investigated and the forward contract cancelled. Corruption was at play here! Otherwise Zambians will never benefit from the lower oil prices!
Zambians will suffer for many years because of the stup!ditty of Sata and Lungu.
Do they care about Zambia and the people?
No, they are just interested in staying in power and helping themselves to the money they have borrowed in the name of the Zambian. People.
Wake up Zambians, your children will starve for generations long after Lungu and his thieves have run away with their loot!
Zambia needs abit of time. We shall recover. The major set back is electricity. Small scale business are dead. Despite load shading, if it was done according to the schedule we can earn a living. For example Garneton Kitwe. The schedule is very frustrating to an extent that the little patience we had for PF is fading quicker. Do something or let Zesco maintain the schedule otherwise we ate collapsing.
Another day of prayers maybe!!
There will be much blood and tears before Zambia recovers. We had only just recovered from KKs 27 years of styupidiy and now we went right back and allowed Sata to take us back there!
This clueless Lungu has NO IDEA what he is doing, and BY DEFAULT is making it TEN TIMES WORSE!
It will take Zambia at least another 25 YEARS just to get back to where we were in 2011 – IF we have competent leaders! If we just have these clowns, GOD HELP ZAMBIA! Then we are totally FCUKED!