Wednesday, April 17, 2024

Why We Think the Proposed Commission of Inquiry on Privatization is Irrelevant- Sinkamba


By Peter Sinkamba

Between 1998 and 2000, in conjunction with the University of Oxford’s Rights and Accountability in Development (RAID), my organization Citizens for a Better Environment (CBE), and Ngande Mwananjiti’s AFRONET, conducted an extensive inquiry into the privatization of State owned Enterprises (SoEs) in relation to various international covenants to which Zambia is a signatory and produced a report titled: “Zambia- Deregulation and the Denial of Human Rights”. Because of the nature of findings, where we established State capture corruption which logically could not be investigated by the accused State itself, we submitted the Report to the United Nations (UN) Committee on Economic, Social and Cultural Rights for further independent investigations in line with the UN Convention on Economic, Social and Cultural Rights to which Zambia was, and remains a signatory up to date. This was in March, 2001, almost 18 years ago.

It is a pity that Mwananjiti and I were labeled by the MMD Government as unpatriotic Zambians and were subjected to momentous State harassment. It had to take Mary Robinson, the former President of Ireland, and at the time, the United Nations High Commissioner for Human Rights to intervene through UN channels to stop the State harassment of UN witnesses, as both Mwananjiti and I were regarded by the UN.

Our general findings were that: money from the sale of SoEs was not being paid into the Privatization Revenue Account (PRA) contrary to the Privatization Act; revenue generated from the sale of assets was not used to further economic and social rights of citizens especially as relates to paying redundancy package schemes, alternative income generating projects, and social projects in the public interest; no Privatization Trust Fund (PTF) was established as required under the Privatization Act, and consequently no shares were retained for their later flotation on the Lusaka Stock Exchange given that the businesses concerned represented the common inheritance of all Zambians who have a right to participate in the fair distribution of the benefits of development, and the Government should account for:

  • the number and value of shares which had been sold;
  • the number of individuals who had purchased shares;
  • details of the share-holdings of politicians and public figures;
  • the banking of the proceeds of each flotation in the PRA, as provided for in the Privatization Act.

Further, we found that shares had been bought through third party proxies. We also noted a replacement of the ZPA and its appointed advisers in the handling of the privatization of ZCCM with a negotiating team under Mr. Francis Kaunda, as appointed by the President, in apparent contravention of the Privatization Act. Furthermore, we established insider dealing. For example, the dual role of Mr. Francis Kaunda had in heading up the negotiations for the sale of Chibuluma mine when he had previously acted as an adviser to the company which emerged as the successful bidder for the assets in question. Also, a number of officials who were on the negotiating team for Anglo packages were later employed as senior staff in Konkola Copper Mines (KCM), an Anglo company that acquired ZCCM assets. In addition, we noted lack of capacity by the Anti-Corruption Commission to investigate allegations of corruption and self-dealing in the privatization process, for example as relates to:

  • the claim that the President held, or had at one time held, shares in Binani Industries;
  •  the allegation, attributed to sources within the Ministry of Finance, that the President had links with Socomer SA, the successful bidder in the purchase of Ndola Lime, despite rival bids from companies with a sound track record in the cement industry;
  • the claim that the President had an interest in the Israeli gem company Hagura which bought Kagem;
  • the contention that Ministers were party to information about the lowest acceptable bids for various assets to be privatized;
  • the allegations of asset stripping and the non-payment of terminal benefits leveled against former members of the Government.

We also noted that some of the positions on the ZPA board were still empty towards end of the privatization of companies. As of June 1998, for example, the Law Association of Zambia, the Bankers Association of Zambia, the Zambia Institute of Chartered Accountants, and the Churches of Zambia, were not represented on the Board. This situation was also criticized by the Parliamentary Committee on Public Investments tasked with prepared a Special Report on Privatization.

As became apparent in due course, these vacancies reflected the fact that the members of the ZPA board, in reality, had little control over privatization. Members of the ZPA Board needed only to meet once every two months. It was therefore the ZPA management which took decisions on the day to day running of the privatization programme and made recommendations to the Board Members. This division of labour between the ZPA Board as the executive and ZPA management constituted common practice. The Board acted as little more than a rubber-stamp on the decisions of the agency’s evaluation and negotiating teams.

The crucial issues were the degree to which these teams were subject to political or commercial manipulation; whether other bodies, including parastatal boards or unaccountable Government committees had the final say over the sales process; and, ultimately, the extent to which such interference in the privatization process actually mattered. There were numerous occasions – often involving the sale of the largest parastatals – when the set procedures had been subverted.

Overall, we found privatization as ‘a looting exercise’ through State capture corruption. A cabal of former ministers and officials bought smaller businesses at bargain prices while failing to close on the sale of major industries. A former Minister for Legal Affairs confirmed that Ministers were party to information about the lowest acceptable bid prices. The ZPA did not have a clear-cut responsibility, let alone the capacity, for monitoring whether businessmen and politicians had bought shares through third party proxies, even though this was illegal under the Privatization Act. Furthermore, when remaining Government holdings in some of the larger businesses were publicly floated, the ZPA had no duty to gather information about how many shares individuals had purchased. The fact that most smaller companies had been sold direct to investors by-passed the more stringent disclosure requirements under the Securities and Investment Act.

We also noted that record keeping on privatization was very poor. In January 1998, we obtained from ZPA a copy of ZPA’s consolidated list of political leaders, public officers and individual citizens who had bought former state owned companies. The last transaction date given was January 1997. It was clear that the information that required real-time updating was not regularly updated, or not even reported at all.

From the list we obtained, it could be ascertained that eighteen businesses had been sold to politicians and public officers. Twelve shops and trading outlets in towns across the country were bought by ten MPs, including among their number seven Ministers or Deputy Ministers. Hotels were bought by the Minister for Local Housing and a former MMD Party MP. A dairy farm near Lusaka was sold to the Deputy Minister for Transport. A much larger farm of 10,000 hectares in Copperbelt Province was sold to RDS Investments Limited, which was owned by the immediate family of Ronald Penza, the then Finance Minister. Consolidated Tyre Service Limited was bought by Amon Kambole Sikazwe and Chibulu Jane Penza. The Penzas had also bid for the strategically important Mpulungu Harbour on Lake Tanganyika, but Ronald Penza was killed before the sale was awarded.

The former Finance Minister’s business interests had been subject to press scrutiny following his sacking by the President in a cabinet reshuffle in March 1998.Less than nine months later, in late November, Penza was shot dead at his home in an apparent bungled robbery. Those suspected of the crime were all shot in extrajudicial killings by police. Some believe that Penza was assassinated and accuse the authorities of a cover-up. The investigation into Penza’s murder and the killing of several of the suspects has been roundly condemned by human rights organisations across the world.

From the lists, there were also apparent anomalies noted in that politicians named in the press as owning privatized companies did not appear in the ZPA list. For example, a former MMD Finance Minister, Emmanuel Kasonde, completed the purchase of the General Pharmaceuticals Company based in Kabwe in May 1994. The acquisition was not recorded in the ZPA’s list we obtained in January 1998 for purchases by politicians although Kasonde’s name was given in the relevant privatization progress report. It is alleged that, subsequent to the sale, the company was stripped of its assets, employee housing was sold to the Zambian military, the main plant was disposed of, and the workforce sacked without severance pay. Several other assets across the country were stripped of assets in similar fashion.

Overall, we found privatization as ‘a looting exercise’ through State capture corruption. A cabal of former ministers and officials bought smaller businesses at bargain prices while failing to close on the sale of major industries.

The Parliamentary Committee on Public Investments also expressed its concern over asset stripping by parastatal mangers in companies prior to their privatization. The ZPA had itself noted that: ‘Management of certain SOEs provided themselves extraordinary and excessive benefits in anticipation of privatization. This created difficulties in negotiations and had a negative impact.’

The danger posed by high-level political, administrative and financial corruption stemmed from its power to determine the whole structure of political and economic relationships, undermining democracy and the rule of law. Allegations were made in a reputable business journal that public money had been siphoned-off into private offshore companies, many of them based in the British Virgin Islands where confidentiality laws are strong and disclosure requirements are minimal. The article repeated the accusation that the web of corruption included the President who owned assets beyond the purchasing power of his salary including properties in Belgium, the Netherlands, South Africa and Zambia as well as stakes in an emerald mine and a lime producer.

As briefly shown above, privatization in Zambia is a text-book case of State capture corruption. State capture is a form of corruption that occurs when the ruling elite and/or powerful businessmen manipulate policy formation and influence the emerging rules of the game including laws and economic regulations to their own advantage. The captured economy is trapped in a vicious circle in which policy and institutional reforms necessary to improve governance are undermined by collusion between powerful firms and state officials who extract substantial private gains from the absence of clear rule of law.

For instance, captor firms can receive extra advantages not only in the form of sales increases, but also in the provision of public goods, such as property rights, by purchasing individualized protection of their property rights from the state. We saw this happen when Government official signed Development Agreements which gave unbelievable tax exemptions and other incentives to privatized firms. This however came at a significant social and economic cost to the nation. A small group of people extracted considerable economic benefits from those distortions. Such distortions included, for instance, state-owned enterprises sold at low prices to politicians, and new laws designed in a way of favouring specific economic actors in a given sector at the expense of free and fair competition for all. Concentration of both economic and political power led to serious State capture, which went hand in hand with a weak civil society. Those of us who had the guts to raise the red flag were intimidated through State machinery. Potential witnesses or those who could spill the beans were eliminated in the fashion highlighted above.

In view of the foregoing discourse, if the objective of the proposed inquiry is from civil law point of law, where the intention is to recover the looted funds or assets, every lawyer worth his salt will agree with me that no person could be held liable even if found wanting on a civil transaction that took place beyond six years. The law limits time for such litigation. The limit for civil actions is largely six years. In any case, most of persons who could be implicated and summoned as accused or witnesses have since died. So, if the objective of the inquiry is to establish civil liability and recovery of funds from those found wanting, then conducting an inquiry now would be an act in futility. Chances will be zero to recover any funds from anyone. And any expenses for such an exercise would certainly result into a total waste.

Secondly, if the objective is from criminal view-point such that those found wanting are held criminally liable, then we do need a commission of inquiry. First of all, it is unlikely that anyone would be found criminally liable for want of witnesses because key witnesses are dead. Even if they are still alive, we do not need a commission of inquiry because there is already the anti-money laundering team and other security agencies, including the Auditor General’s office, all of which have statutory power to investigate and prosecute economic and financial sabotage crimes. These institutions have already been allocated resources for 2019 financial year, and would be good to go should need arise to do so. In the interest of austerity measures, this should be the most prudent way to go. One may argue that these institutions are compromised, but what guarantee is there assure that the commissioners to be appointed would not be compromised? So far, the Auditor General has demonstrated professionalism and we have no doubt that he or she could do a good job. The trouble is, as highlighted above, record keeping on privatization is very poor and thereby unlikely to produce a credible audit trail.

Thirdly, if the inquiry is for sake of putting the record straight, this has already been done. As indicated above, the Parliamentary Committee on Public Investments prepared a Special Report on Privatization. The Parliamentary Committee on Economic and Labour portfolio has also produced reports. These reports can be accessed from Parliament library.

Furthermore, our report, “Zambia- Deregulation and the Denial of Human Rights” covered a lot of ground in this regard. This which could be accessed on this link:

In conclusion, this makes our case why we think the proposed commission of inquiry will be a waste of public resources.

Green Party leader Peter Sinkamba

The Author is the President of the Opposition Greens Party in Zambia


  1. This idyot and Lungu supporter has woken up to parrot what Fundanga, Katele Kalumba, Laura Miti, Chibamba Kanyama, and even HH himself have been saying all along that it is a useless idea!! The Green Party Leader is a Lungu minion, no doubt about that. What he is saying here is because he has seen that thief Lungu will be caught in his own web!
    Where is that Monkey without a tail called Amos Chanda the one who issued the directive! We want that probe to go ahead – this has been a useful debate that has already brought more information that many people didnt know!! All those monkeys trying to be smart will be jailed some of them for the second time but for different thefts, like Sakala and Francis Kaunda.
    Bring the Inquiry on – you idyots and mother fckers!!

    • Such reactions by UPND rank and file makes a case why UPND should never be allowed in corridors of power. If can be this foul-mouthed when NOT in government, what more when in power? The trouble is that UPND is full of dull characters who lack capacity to reason such that there solace is insults, insults and insults. What a shame!

    • There is a heist currently underway, being undertaken by PF00Lish govt. It’s even bigger than privatization looting.
      – Indebting the country with $-Billions by inflating cost of infrastructure projects. Lungu & PF thieves get kickbacks from Chinese company awarded contract.
      – Influx of millions of Chinese & Rwandese traders who are being protected by Lungu. They are taking opportunities from informal self-employed citizens.
      – Theft of 3rd Eurobond loan in 2016.

    • That’s a 100 … but we need to review current reports so that we can strengthen our institutional capacity going forward.

    • This guy is quite objective this provides a good insight into the rot of the privatisation programme.
      The roles of valentine chitalu, dipak patel and others must be scrutinised too.
      Am beginning to like this Sinkamba chap!
      Perhaps chamba is not a bad idea as such.

    • Ba Sinkamba bazala. This must have given him the merry go round & tired him out & to no avail. We understand. Corrupt politicians can be frustrating. But speaking for the sake of the country, this inquiry is a good thing for Zambia. It will remind Zambians & make them realise that people will sale them slogans like “the hour has come”, “more money in your pocket” & then Zambians give them their votes & sit back & watch their country being looted. Next they die in office & leave a will to fight about when before they took power they only declared owing 8 guns. Another group is gathering with another unexplained slogan “forward”, to where is not explained. Zambians must learn that these politicians are in it for themselves.

  2. The inquiry is welcome so long as all participants in the privatization are investigated fairly and independently.This includes Edgar Lungu who was the head negotiator in the sale of Zambia Cold Storage board.

    Edgar Lungu should not hide behind presidential protection or immunity.He must step down in the interest of Justice to allow a full and independent inquiry.

    JACOB ZUMA did the same not so long ago.

  3. So you were involved in the RAID privatization report? I read it 14 years ago, I have to say it’s well researched.
    It’s a petty very few people have read it, esp the newer generation. Will post a link as soon as I find it online.

  4. Some interesting notes in the RAID Report of state assets bought by serving MMD Ministers
    -Hartley Farms, bought by Gilbert Mululu.
    -Lake Hotels was sold to Hon Bennie Mwiinga, MP and Minister for Local Government and Housing.
    -La Hacienda Hotel in Mumbwa, CentralProvince, was bought by Stanford Hlazo, who subsequently resigned his position with the MMD to join the National Party.
    -The National Drug Company outlet at Monze was bought by Hon Suresh Desai, MMD MP and then Minister of Agriculture.
    -Former National Home Stores were bought in Sichili and Mongu by Hon Leonard Subulwa, MMD MP and then Minister for Western Province; in Kaoma by Hon Stephen Manjata, MMD MP and Deputy Minister of Community Development and Social Welfare; in Lukulu by Hon S C Ngombo, MMD MP and then Deputy…

  5. ….Minister for Education; in Namwala by Hon Chulu Kalima, MP; in Sinazongwe by Hon S Madyenkuku, MMD MP and Deputy
    Minister of Labour and Social Security; in Siavonga by ZEFA Trading Limited, a company in which Hon Frederick Hapunda, MMD MP has an interest; and in Sesheke by Tusa Security Limited, part-owned by Hon Richard N’ganga, MP. Tusa Security Limited was also successful in its purchase of another outlet in Sesheke, formerly part of the Zambia National Wholesale & Marketing Company.
    -Other shops owned by the Consumer Buying Corporation of Zambia at Kabompo and Kasempa were sold, respectively, to Hon Anoshi Chipawa, MMD MP and Deputy Minister of North West Province and Hon Patrick Kafumukache, MP and Cabinet Minister.

    • Corruption scandals: Social Security Cash Luxury Presidential Jet Ambulances Fire Trucks Mukula Trees Ndola-Lusaka Rd Malawi Maizegate Fuelgate Swaziland landgate Zesco Loans Corruption scandals: Social Security Cash Luxury Presidential Jet Ambulances Fire Trucks Mukula Trees Ndola-Lusaka Rd Malawi Maizegate Fuelgate Swaziland landgate Zesco Loans

      Of course we have been telling these numskulls that the real culprits are those who served in the MMD government. FTJ Kafupi is the biggest thief of them all… The Post even reported most of his looting back in the day.

      the ones you have listed here are nothing in comparison, just small lodges here and there… move up North of the country and see grand scale corruption involving huge assets and companies. Those wouldn’t even be listed publicly and so you may not even find them in any report as paper trail may have been destroyed or may not even have existed.

  6. Corruption scandals: Social Security Cash Luxury Presidential Jet Ambulances Fire Trucks Mukula Trees Ndola-Lusaka Rd Malawi Maizegate Fuelgate Swaziland landgate Zesco Loans Corruption scandals: Social Security Cash Luxury Presidential Jet Ambulances Fire Trucks Mukula Trees Ndola-Lusaka Rd Malawi Maizegate Fuelgate Swaziland landgate Zesco Loans

    Hey @ Dokowe mate, so you didn’t read the entire article above by Sinkamba? Because if you did you would have come across the web link he posted to the report… already downloaded it and will be reading it in the next few days.

    Perhaps coincidence but I raised similar questions to that of Sinkamba with regards to the aim and objective of the so called Commission of Inquiry on Privatization a few days ago on the HH article: ‘I have Never Privatized Anything and was Never in any Cabinet-HH’.

    We fail as a country (in fact we have already failed) if the people in power become this narrow minded as to throw their weight and power on issues whose main purpose is targeted at fixing individuals who are their main political rivals or enemies. We should be focusing on issues that…

    • Corruption scandals: Social Security Cash Luxury Presidential Jet Ambulances Fire Trucks Mukula Trees Ndola-Lusaka Rd Malawi Maizegate Fuelgate Swaziland landgate Zesco Loans Corruption scandals: Social Security Cash Luxury Presidential Jet Ambulances Fire Trucks Mukula Trees Ndola-Lusaka Rd Malawi Maizegate Fuelgate Swaziland landgate Zesco Loans

      …We should be focusing on issues that add value to the nation and benefit the current and future generations to come. If these guys were truly serious they would have championed this inquiry during the the MMD government when main suspects, the looters and the thieves were still alive. Yes they are still pockets of some those suspects right now but the biggest ones, Chiluba himself is dead.

      Meanwhile what do we do with the current ‘mini’ privatisation that is shrouded in secrecy where the state assets, including the biggest asset of them all, land, are being sold to the Chinese for a song with Lungu and his minions the only beneficiaries getting richer by the day? What about the massive debt being obtained in secrecy? It was debt that lead IMF and World Bank to squeeze our balls…

    • Corruption scandals: Social Security Cash Luxury Presidential Jet Ambulances Fire Trucks Mukula Trees Ndola-Lusaka Rd Malawi Maizegate Fuelgate Swaziland landgate Zesco Loans Corruption scandals: Social Security Cash Luxury Presidential Jet Ambulances Fire Trucks Mukula Trees Ndola-Lusaka Rd Malawi Maizegate Fuelgate Swaziland landgate Zesco Loans

      …It was debt that lead IMF and World Bank to squeeze our balls last time and forced us to sell the state assets for a song… so these PF guys should really look themselves in the mirror!

  7. Peter what we want to know is what happened. Not all of us are privileged to have the information that you have, it’ll help understand. For example, General Miyanda was accused in the liquidation of Zambia Airways but information emerged that he was against the idea and spoke with passion in Cabinet. So don’t suppress the truth.

    • For instance he allowed Mmembe to purchase Zambian Airways with money borrowed from DBZ. The airline folded and the money has not been repaid. He also gave positions to relatives especially on education boards. We have the names of those ill qualified people who became bosses at various education boards.

  8. Further Mwanawasa’s been lauded as the champion of the fight against corruption, we want to know how his relatives managed to buy almost all residential properties of former SOEs against the policy of selling to sitting tenants. Sata accused Hichilema of acquiring shares in every company he was asked to sell, was that true or not?

    • @ Ayatollah, Dude if you can’t get it now then you will never get it, you are too thick headed. you keep going back to HH and now you include Mwanawasa.

  9. Ahh…ahh so along along the pf rats have been sontaring privertisation when they see the name HH , I thought HH was alone in the privertisation thing the way they have been jumping and pointing…..

    On top of that Only to find lungu is also a privertisation looter ….


  10. Mr Sinkamba,s article is good and informative, though highly rhetorical with many swings about in logic. Clearly, it’s a good idea and needed. 18 years ago is a long time, to keep hold of the negative attitude you state, ‘As briefly shown above, privatization in Zambia is a text-book case of State capture corruption.’. That is prejudice and not a good enough reason not to try again.

    We need to be alert to corruption in public office and if politicians want to serve the people well, they must burch (birch is a tree autocorrect!) the evil greed within them.

    • No wait……… autocorrect WAS correct for once! Burch is an SUI treatment! Freudian slip no doubt!

      To birch is a formal punishment in which a person is flogged with a bundle of birch twigs.

  11. I told the chanda boys that this is the can of worms you shouldn’t open
    But them being so high and mighty didn’t listen
    This issue is going to be very ugly I suggest you watch your backs because in as much as you thought you were fixing HH you’ll end up stepping on a lot of people’s toes
    People who thought they had gotten away with it

  12. Investigations must be done on a non partisan level , independent and non partisan must come into this case let politicians be left out of this issue as we well know them all to be crooks either in government or in opposition the law of the land should be left to do investigations.
    It would be prudent to give those in politics, to rest from politics until they are cleared from this enormous problem that has devastated the nation.
    We cannot allow crooks to rule over us let them be tried in the courts and be punished severely if found guilty even excluded from politics.
    We cannot allow these despicable characters to sit in government offices when they are our enemies , any one who did wrong must face the law you cannot just keep quiet when things are wrong .

  13. So all these findings must be swept under the carpet and ignored just because nothing was done about it at that time?

    In fact Sinkamba should be very happy that his efforts with RAID and AFRONET were not in vain and simply bring back his findings which would be of great use to the new inquiry. Pursuers of truth must not resign until the truth is heard. The objective of the inquiry must be to avoid similar irregularities recurring even if no one will sqaurely take the blame. There is no substitute for truth.

    • @Nine Chale, You have said EXCELLENTLY ( if such grammar exists). Why should we have to spend on something that can improve our governance!? I believe those who will be found wanting will in future ensure that similar commission are instituted each time there is need especially to hold to account those in power.

    • Hoping we shall see the report from this particular inquiry!! So many inquiries have been carried out and oftentimes someone decides to keep the report in his drawer. What makes you think this will be any different?

  14. Just checking how the Chandas have as we say “stoned a beehive”,and when we tell rhe humble leader to change his advisers he adamantly refuses….wapya muzi hehehehe

  15. @Nine Chale, You have said it EXCELLENTLY ( if such grammar exists). Why shouldn’t we have to spend on something that can improve our governance!? I believe those who will be found wanting will in future ensure that similar commission are instituted each time there is need especially to hold to account those in power.

  16. sikamba he is not a boot raker this is the more reason he has never supported hh and upnd because he knows who hh is and how this guys has rooted this nation

    • Are you sure ba Nzelu kuti HH is an example of a dunderhead!? I wonder what planet some of you Zambians come from. Perhaps you don’t know the meaning of dunderhead.

  17. Africa ,esp zambia needs people who can provide solutions to the economic woes the country is facing.the best we can do as zambians is to push for inquiry on the current mini privatization happening under pf because its easy to trace and prosecute ,than to deal with a complex and none beneficial to the inquiry which started 25 years ago.There are many reports on zambia s privatization by different orgas,schoolers and universities around the globe.the problem zambians is we dont READ but we like to be told and foolishly we take that as the truth .LETS DEAL WITH THE CURRENT ABUSE OF POWER,THEFT AND PUT UP SYSTEM.

  18. I wouldn’t be surprised if the UNZA students demanding for the inquiry have never even read half the reports produced so far on Zambian privatization. That is the extent of general decadence in this country. Cheap un researched talk rules.

  19. When KK asked about the sold companies, he was answered with bullets at Kabwe. So it’s important that we know who’s who in the Zambian Privatization story. You may insult us but we’ll soon know who you are.

  20. Those who bought mine, council, government and other company houses at ridiculously low prices such ask Ten Kwacha for a house should top up or houses should be repossessed and given back to GRZ or councils

    • Nobody bought a mine house at 10 kwacha. Lowest was 3million kwacha which today translates at 3 times. I built a 3 bedroom house at 11 million kwacha at the time so 3 million for an old house was ok. I don’t know about council houses. In my opinion this exercise may be good but also a waste of public resources like Mwanawasas Task Force.

    • I guess it signifies that Sinkamba is Non-aligned! This article is testimony to that view, very objective and non-aligned!

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