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

German Ambassador Bernd Finke has been asked by media houses to comment on the decision of the Government of Zambia, as announced by Minister of Finance Alexander B. Chikwanda in Parliament on 13 February, to seek an aid program with the International Monetary Fund/IMF. Here are Ambassador Finke’s preliminary remarks:

I have taken note of Finance Minister Chikwanda’s announcement before Parliament that the Zambian Government would seek an IMF support program.

Going to the IMF is never an easy decision. Therefore we can assume that the Zambian Government has engaged in a thorough and unvarnished stock-taking exercise about the current economic and financial situation of the country and has come to the conclusion that an IMF support program is the best option to tackle the current crisis and to secure Zambia’s financial solvency and liquidity.

If
this assumption is correct, I would say that it is prudent to seek IMF assistance rather sooner than later. Better to address the current challenges immediately, however painful that might be, than to further delay crisis management and reforms.

We need to bear in mind that an IMF support program is not a free gift. IMF aid packages are usually closely linked and dependent on governments’ readiness to accept austerity measures and initiate overdue economic and financial reform programs. If the Zambian Government is committed to such measures this would be good news as well.

No doubt, there are major external factors which have triggered and aggravated the current economic and financial crisis, among them the unpredictable fall of copper prices or the bad rainfall patterns, which heavily contributed to the energy crisis. But there are also – as the President and Ministers have repeatedly acknowledged – domestic policies and sectors which are in need of urgent reforms.

If an IMF program contributes to accelerate economic policy reforms, strengthens good financial governance, leads to the overdue diversification of the economy, and harvests Zambia’s great potential for economic growth and employment, then the Government’s decision to go for an IMF support program should give rise for optimism – for the Zambian people and for Zambia’s long term Cooperating Partners and friends, like Germany.”

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30 COMMENTS

  1. PF & Chikwanda have brought so much misery upon Zambians. Those of us who lived under IMF conditions know how painful for a country to go under an IMF program. Best answer for Zambia is not an IMF program but to remove PF from power in 2016. PF & Chikwanda have failed us. Full stop.

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    • When we told the Zambians that our country will be the next Greece, the thought we where making up things, Look now EL and PF are taking us back in the hands of the wolves. Poor Zambia, I am sure the conditions to this support will be very hash. Its good in a way so that Zambians can learn a lesson or two that comes with bad leadership. EL and PF have been a failed project from the word GO.

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    • This is what you get when you get a Dinosaur or Broken Hill man trying to apply 1970’s Economics in the 21st century!! If am not mistaken, OUR FU..CKING FOREIGN DEBT WAS TOTALLY WRITTEN OFF, the you get “Broken HIll man”, immediately after his appointment DECLARING THAT HE WAS IN A FU..CKING HURRY TO BORROW AS MUCH AS HE COULD – with the ST..PI.DITY OF US ZAMBIANS & our “SLEEPING” memebers of the opposition, just sat back & watched – the Chap will be LONG DEAD whilst we will be squirming under IMF & THE WORLD BANK – this is what happens when Riff Raffs like Sata only qualified to be a Victoria Station guard are elected by gullible zedians to become presido!!!

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    • PLEASE, READ AND ANALISE WHAT THE DIPLOMAT HAS SAID BEFORE JUMPING INTO MARKET YOUR IGNORANCE AND TOTAL LACK OF ISSUE-UNDERSTANDING. I FOR ONE DON’T LIKE IMF (AND THE WORLD BANK) AND I WOULD RATHER OUR GOVERNMENT ENGAGE OTHER GOVERNMENT(S) FOR A LOAN, SAY CHINA IN THESE CASE. ANY LOAN FROM THESE BLOOD-SUCKING INSTITUTIONS WILL ALWAYS BE THAT OF A MASTER AND SLAVE. THEY ARE USED TO SEEING THE BLACK CONTINENT AS A SUPPLIER OF SLAVES AND FREE RAW MATERIALS. SINCE SLAVERY FINISHED (NOT BY THEM BUT BY THE FIGHT OF SLAVES THEMSELVES) THESE SLAVE RIDERS HAVE INSTITUTED OTHER EXPLOITATIVE INSTITUTIONS IN THE NAME OF IMF, THE WORLD BANK, ETC TO EXPLOIT AFRICA. SOMETIMES, I AM EVEN HIGHLY SUSPICIOUS OF THE UN CLUB- IT IS PURELY FOR THE INTEREST OF IMPERIALISTS, OTHERWISE SEVERAL AFRICAN COUNTRIES…

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    • …OTHERWISE SEVERAL AFRICAN COUNTRIES WOULD HAVE BEEN SITTING ON THE SECURITY COUNCIL. THEY HAVE GOT NO REGARDS FOR AFRICA AND THAT’S WHY AFRICA MUST STICK WITH CHINA.
      HOWEVER, TO COMMENT ON THE DIPLOMATS INFORMATION, I WOULD SAY IT IS CLEAR- EVEN THE DIPLOMAT KNOWS AND HE NEVER HID THE FACT THAT THESE ARE BUT BLOOD SUCKER- IMF. IT IS ONLY WHEN YOU ARE TAKEN BY SURPRISE AND YOU HAVE NOWHERE TO GO THAT ONE SHOULD EVEN BE THINKING OF THESE BLOOD SUCKERS. GOVERNMENT-TO-GOVERNMENT FINANCIAL ARRANGEMENTS ARE THE BEST AS AT NOW. THE OTHER FINANCIAL ARRANGEMENT MAKING SENSE IS THE AfDB. BECAUSE, IT IS AN INVESTMENT WITHIN AFRICA. FOR ALL OF YOU SAYING YOU TOLD PF- THAT’S BEING EMPTY-HEADED.

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    • …WOULD HAVE BEEN SITTING ON THE SECURITY COUNCIL. THEY HAVE GOT NO REGARDS FOR AFRICA AND THAT’S WHY AFRICA MUST STICK WITH CHINA.
      HOWEVER, TO COMMENT ON THE DIPLOMATS INFORMATION, I WOULD SAY IT IS CLEAR- EVEN THE DIPLOMAT KNOWS AND HE NEVER HID THE FACT THAT THESE ARE BUT BLOOD SUCKER- IMF. IT IS ONLY WHEN YOU ARE TAKEN BY SURPRISE AND YOU HAVE NOWHERE TO GO THAT ONE SHOULD EVEN BE THINKING OF THESE BLOOD SUCKERS. GOVERNMENT-TO-GOVERNMENT FINANCIAL ARRANGEMENTS ARE THE BEST AS AT NOW. THE OTHER FINANCIAL ARRANGEMENT MAKING SENSE IS THE AfDB. BECAUSE, IT IS AN INVESTMENT WITHIN AFRICA. FOR ALL OF YOU SAYING YOU TOLD PF- THAT’S BEING EMPTY-HEADED.

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    • “frm 1.3. WOULD HAVE BEEN SITTING ON THE SECURITY COUNCIL. THEY HAVE GOT NO REGARDS FOR AFRICA AND THAT’S WHY AFRICA MUST STICK WITH CHINA.
      HOWEVER, TO COMMENT ON THE DIPLOMATS INFORMATION, I WOULD SAY IT IS CLEAR- EVEN THE DIPLOMAT KNOWS AND HE NEVER HID THE FACT THAT THESE ARE BUT BLOOD SUCKER- IMF. IT IS ONLY WHEN YOU ARE TAKEN BY SURPRISE AND YOU HAVE NOWHERE TO GO THAT ONE SHOULD EVEN BE THINKING OF THESE BLOOD SUCKERS. GOVERNMENT-TO-GOVERNMENT FINANCIAL ARRANGEMENTS ARE THE BEST AS AT NOW. THE OTHER FINANCIAL ARRANGEMENT MAKING SENSE IS THE AfDB. BECAUSE, IT IS AN INVESTMENT WITHIN AFRICA. FOR ALL OF YOU SAYING YOU TOLD PF- THAT’S BEING EMPTY-HEADED.”

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    • BBC 24th February 2016: In a briefing ahead of the Budget, Mr Gordhan said: “There is no doubt about the fact that we are in crisis.”
      The measures announced in Parliament were aimed at stopping the country falling into recession and to appease the rating agencies who have threatened to downgrade South Africa to junk status, which would raise borrowing costs for the country.
      Mr Gordhan unveiled government spending cuts, a civil service job freeze and some moderate tax rises.
      These tax increases affect property sales, fuel, sugary drinks, alcohol, tobacco and and capital gains, as well as environmental levies, which are expected to bring in an extra 18bn rand ($1.18bn; £840m).
      He had been expected to announce plans on privatising state assets – he fell short of that but said the…

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    • …….continued:He had been expected to announce plans on privatising state assets – he fell short of that but said the government was looking at the possibility of merging the loss-making national carrier, South African Airways, with the state-owned SA Express airline “with a view to engaging with a potential minority equity partner”.
      Privatisation has long been resisted by sections of the ruling African National Congress.

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    • Ba Peter, the one exhibiting their ignorance here is you my friend. For how long are you going to play the victim of slavery, imperialism card? These problems fall squarely on us and our inability to elect serious people. Who in their right mind is willingly giving you a loan without making sure their money is protected? Even the China you talk about attaches strings to the loans they give, look around at the so called infrastructure loans government gets from China, mostly chinese contractors engaged therefore bulk of the money ends up back in that country anyway. IMF have every right to attach conditions, its their money. And if you read between the lines of this statement, the man is saying don’t wait until after elections to make economic reforms, it may be too late.

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  2. It’s a rich mans game no matter how they spin it. The only thing the world bank and the IMF were put in place to do was to take as much of other countries wealth and resources as they could. ?

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    • @ Short Memory: IMF intervention never saves anything but sends a country into a vicious cycle of debt and interest payments. It is a struggle to repay IMF debts and any benefit from an IMF debt is very short term.

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    • frm 1.3. WOULD HAVE BEEN SITTING ON THE SECURITY COUNCIL. THEY HAVE GOT NO REGARDS FOR AFRICA AND THAT’S WHY AFRICA MUST STICK WITH CHINA.
      HOWEVER, TO COMMENT ON THE DIPLOMATS INFORMATION, I WOULD SAY IT IS CLEAR- EVEN THE DIPLOMAT KNOWS AND HE NEVER HID THE FACT THAT THESE ARE BUT BLOOD SUCKER- IMF. IT IS ONLY WHEN YOU ARE TAKEN BY SURPRISE AND YOU HAVE NOWHERE TO GO THAT ONE SHOULD EVEN BE THINKING OF THESE BLOOD SUCKERS. GOVERNMENT-TO-GOVERNMENT FINANCIAL ARRANGEMENTS ARE THE BEST AS AT NOW. THE OTHER FINANCIAL ARRANGEMENT MAKING SENSE IS THE AfDB. BECAUSE, IT IS AN INVESTMENT WITHIN AFRICA. FOR ALL OF YOU SAYING YOU TOLD PF- THAT’S BEING EMPTY-HEADED.

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  3. IMF is evil.
    It is the modern day colonialism that saps the poor and only benefits Wall Street and Wealthy countries. Its development model has already been proven to be fundamentally flawed. We’ve been through this before and it failed. Remember SAP?
    Stupidity is doing the same thing over and over hoping for different results.
    Chikwanda Must Fall.

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    • It is not chikwanda, it is the whole PF that must go. As a fact, it was chikwanda who highlighted the theft by PF of the eurobonds meant for projects by overinflating prices. He was trying to protest the budget deficit and pointed to the overpriced roads by PF gangs.

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  4. This is really how the wealthy get wealthier. They steal from the poor by plugging themselves into the system. The more people you can manipulate in government and in society, the more leverage you have in terms of making a profit through systematic economic subversion.

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  5. He (from Germany) is part of the cartel that eliminated Muamar Gadhafi (who had refreshing ideas about sustainable African financial system). Ofcourse the western countries want you to keep borrowing from them, we call it recolonizing.

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  6. That is the gift PF has for Zambia after bankrupting and then looting some more of what is left. The luxury in which Mps live is astounding, everything is free. Then they tried to loot GRZ vecheals buy trying to buy them at giveaway prices to them selves. They have put Zambia in big dept while enriching themselves by sharing over inflated road contracts.

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  7. Under PF it is only borrowing that is recommended. These guys don’t have an idea how to run a country-CHIPANTEPANTE GOVT.

    Mwanawasa did his best to write off all debt that Zambia has ever had. Barely a decade we are already in more debt than those we found.

    PF twafweniko please, don’t politicise everything, work to clean this mess you have brought upon yourselves.

    THIS IS THE WORST GOVT I HAVE EVER SEEN IN MY WHOLE LIFE AS A ZAMBIAN.

    Barely a term and everything is on its knees.

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  8. The diplomat is being diplomatic and is warning PF to be prudent and not just borrow anyhow. The problem is that the money is going to Chinese who are giving us poor roads and buldings. Let the money come to zambians

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    • @Bwalya,good observation but the problem is that we Zambians lack the discipline to own and control anything. If all the money for projects is given to Zambians,it will just grow wings and buy properties,fund parties,concubines and bring deaths among some businessmen. Even the poor roads and buildings you are talking about will not be there!! How many projects have been abandoned by Zambian contractors after merely collecting mobilization funds? How much shoddy work have we seen from our own contractors who should have been doing their best for their country and pride for posterity?Charity begins at home and so far as Zambians we seem to lack serious consideration for diligence and respect for public funds and property!

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  9. This is the problem with the PF govt, they cannot come with anything really constructive when it comes to managing the economy apart from borrowing and asking for advise from the IMF. If I had any influence I could simply do away with the IMF. There is no country which has ever improved their economy even after borrowing huge amounts of money from the IMF. ABC and his friends must simply go away other than continue dragging the country into deep credit every single year. This enough proof that these men and women have failed us because they have been borrowing from the time they came into power. You cannot have million projects going in the country with borrowed money even when you have no clue and plan how to pay back. With the Chinese at the helm of ripping us off, by the time we ever…

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  10. Ba Chikwanda reality has come to dawn with your Govt that has mismanaged the Zambian Economy to this extent where now we are rushing to the IMF and World Bank for assistance on how to prudently manage our economy just within a space of five (5) years after taking over a vibrant economy left by the MMD in 2011…….. Shame on you Mr Chikwanda and your PF govt……you guys indeed failures!!!!!!!!

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  11. @1.3……WOULD HAVE BEEN SITTING ON THE SECURITY COUNCIL. THEY HAVE GOT NO REGARDS FOR AFRICA AND THAT’S WHY AFRICA MUST STICK WITH CHINA.
    HOWEVER, TO COMMENT ON THE DIPLOMATS INFORMATION, I WOULD SAY IT IS CLEAR- EVEN THE DIPLOMAT KNOWS AND HE NEVER HID THE FACT THAT THESE ARE BUT BLOOD SUCKER- IMF. IT IS ONLY WHEN YOU ARE TAKEN BY SURPRISE AND YOU HAVE NOWHERE TO GO THAT ONE SHOULD EVEN BE THINKING OF THESE BLOOD SUCKERS. GOVERNMENT-TO-GOVERNMENT FINANCIAL ARRANGEMENTS ARE THE BEST AS AT NOW. THE OTHER FINANCIAL ARRANGEMENT MAKING SENSE IS THE AfDB. BECAUSE, IT IS AN INVESTMENT WITHIN AFRICA. FOR ALL OF YOU SAYING YOU TOLD PF- THAT’S BEING EMPTY-HEADED.

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  12. It will be very wrong to borrow from IMF. Show me a country that IMF has ever helped come out of economic challenges. Please if you want to borrow just go for another bond this time Asia Bond or China Bond. Its better to pay high interest than be slaves to IMF. Look at Ghana, the country which was recently heading for economic glory is now at the mess of IMF and World Bank. What happened to the economic gains Ghana made, talk of good governance, democracy name them it was in Ghana. The big question is why is it that African countries with a good record of democracy still suffer worse than western nations with no serious wealthy in their countries.

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  13. this is what his excellence hh meant, chimbwi no plan, ba chipantepante, pipo called him names, now u see even raising salaries is a problem, pf kuyabebele.

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  14. The IMF like a doctor won’t give u Panadol for malaria. They will give chloroquin or quinine. You Zambians are stupid. You elected monkeys and fools to rule. This is what u get. The Pf maggots came to steal, kill and destroy. Right now the pf maggots have stolen all the money and stashed it abroad. Even Davies chama who was nothing, now owns a plane. The list is endless. These pf locusts have only left problems for the 14millon Zambians. Muzanya njala manje.

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