Chibamba Kanyama
Chibamba Kanyama

By Chibamba Kanyama

1. This has been a highly anticipated statement by Eurobond holders. They have been glued to the IMF website in past few months to know the position of the IMF on Zambia’s economy.
2. IMF Board statements go through extensive reviews within the Fund. The meeting on Zambia took 30 minutes as per standard but much of the work was done weeks before the Board Meeting. What we are now reading is the Fund position on Zambia, expressing deep concern on public debt- which, according to the Fund, is a key driver to the deterioration of the economy; putting us in danger of debt distress.
3. What the IMF Board has assessed is not new to Zambia, not even to the Government. Those fears have recently been expressed by government itself, leading to ‘re-announcement of austerity measures in June.’ What is new is that the concerns are coming from the IMF Board.
4. The position of the IMF Board has implications on the performance of the Eurobond and capacity of Zambia to refinance the external debts. Investors were expecting a bit more optimism from the global monetary watcher and financier. The reading of the situation by investors is that Zambia may default on debt and this is their takeaway from the IMF Board statement. They know IMF always cultures public statements in a manner they do not negatively affect investor perceptions of the given economy.
5. However, the position of the IMF Board is not about hopelessness. It has very clearly guided Government on actions to take to reverse the deteriorating economic fortunes and this is summed up in one sentence, ‘Directors welcomed the Cabinet decision in late May to indefinitely postpone the contracting of all new non concessional loans, cancel some committed but undisbursed loans and enhance the control and management of disbursements of foreign financed loans, and to strictly adhere to public financial management rules under the 2018 PFM Act.’
6. What I strongly read from the IMF Board position is that IMF is ready to help Zambia. Where else would Zambia get reasonable concessional loans away from the Fund itself? This message is carefully nuanced in the statement and government observes the hidden but clear invitation.
7. What this means is that Finance Minister Bwalya Ng’andu should pick up the phone and call the Mission Chief for Zambia to do two things. First, ask her to send a replacement to Alfredo Baldini, IMF Resident Representative, who was recalled in July 2018. This person is the Ambassador whom government can start discussions with, particularly to guide government on how to clean up and harvest data that facilitates for smooth programme discussions. Second, the Minister should agree with the Mission Chief on a clear programme roadmap, more so that we are heading for general elections in two years’ time. This event has implications on programme negotiations. The earlier it is done the better and I want to assure Government that an IMF programme will actually do more good to economic stability and public support than harm.
8. I also remain optimistic that the new Finance Minister will have international goodwill if he studies this document, frankly shares it to Cabinet and then come up with clear actions in response.
9. I wish Zambia well.

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28 COMMENTS

  1. Great summary. You clearly very fearful as you give advise to a government that takes advise opinions as insults. I admire your courage and wisdom.

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    • I don’t trust this dude coz he a lobbyist for IMF, just doing his job and picks up a cheque at end of the month. But if they are willing to do a deal, why not. N’gandu can do without this IMF lobbyist dude though, just play by the book. I just dislike opportunists.

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    • One would wonder why a patriot on the inside of these loan makers will take to the press to offer advice on the economy, it’s like no one is willing to listen to you coz you two faced.

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    • @ layman: So thick and dull you are! Clearly, you seem to be thinking with your Ass and your tribe instead of your brains!
      The fact is Zambia needs to borrow and it can only be either from IMF or China. So why would you prefer Lungu to continue contracting non transparent and hidden Chinese Loans that he can easily steal to building 48 Houses for his daughter at public expense? Now that is plain STU.PID and foo.lish and that is how you plainly you are!
      IMF loans come with safeguards that they can never be paid into Chitotela or Lungu’s Bank Accounts and that is why Lungu hates them!

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    • Just saying, IMF loans come with very tough parameters and they don’t give a dime how it affects you long term especially if your an African nation. Otherwise if these loans are better as you say, why use spin master Chibamba? Good things sell themselves. But yeah N’gandu needs a quick buck as it is to doctor the dime economy.

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    • Chibamba seems to be supporting the junk economics model were IMF certainly doesn’t want to make its wealthy client oligarchies pay. Zambua was forced to privatise 80% of its economy in 1991 – 1997. The result was early deaths for most our people, this can’t happen again Chibamba. It seems IMFwants to squeeze ore economic surplus out of the labor force. So countries are told that the way they can afford to pay their enormously growing dollar-denominated debt is to lower wages even more. To the IMF’s ideological models, there’s no limit to how far you can lower wages by enough to make labor competitive in producing exports. The IMF and World Bank thus use junk economics to pretend that the way to pay debts owed to the wealthiest creditors and investors is to lower wages and impose…

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    • The Lazy Lungu govt was advised by Chibamba Kanyama way back when IMF started making trips to Zambia of what is to be done but they ignored everyone…they told them 10 years ago that their borrowing was unsustainable they never listened …now its judgement day end of the road or end of the party!!

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    • Very disappointed with Chabamba Kanyama`s wrong interpretation of IMF`s statement. Common man! Be man enough and give an accurate interpretation. The truth is, IMF has no respect for PF government. IMF perceives PF as a corrupt and incompetent group that can never be taken seriously on governance issues. Let me put it in simple language. As long PF is in power, IMF will never help Zambia. Period!

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  2. A thie.ving Govt of Lungu can never ever think of complying with clear and competent economic reasoning of sensible people like Kanyama, Prof Oliver Saasa, Musokotwane, and so many others!
    Edgar Lungu enjoys and thrives on Lubinda Haabazoka’s brand of Economic Chaos that advocates for Nationalisation of Mines without Compensation; more KCM style saga of no Arbitration; Day Light Robbery, Unbridled Corruption where 48 Houses that built themselves, etc.
    Chibamba is wasting time to educate Lungu, the Chief thi.ef and tribalist, about Economic Order because that is the last thing he wants to hear because it will stop him from stealing and looting!
    Chickens dont like Xmas because that when they and their relatives get eaten; and so Lungu hates Economic Order.

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  3. Chibamba Kanyama has always been precise and concise in his economic observations and discourse. The Finance minister and President will do well to listen.

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  4. Ba Chibamba Kanyama, we know that you are Strong UPND carder who like many empty UPND tins sees nothing right about PF but everything wrong because HH has promised you government jobs in his dreams. I challenge you Kanyama, and many UPND dunderheads, have you lately followed what Dambisa Moyo has been saying about Africa in general and Zambia in particular. She has been very positive about Africa’s outlook and proudly on Zambia. The problem you guys have is that you think short-term but rich minds like most of us choose long-term strategies hence what PF and President Lungu are doing today is creating a solid and firm ground for a dynamic environment. Its not true that Zambia cant raise a Billion Dollars in any given Financial Year but the likes of the IMF have made you believe them…

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    • Ati

      “….have you lately followed what Dambisa Moyo has been saying about Africa in general and Zambia in particular….”

      Did she also mention houses just building them selves from thin air ????

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    • I don’t have time for ivory tower intellectuals. Bring it over to ground, make it practical. Not CNN, TED talk economics. Real economists are social planners not white collar pushers.

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    • A really functional and progressive international monetary fund that would try to help countries develop would say: “Okay, banks and we (the IMF) have made bad loans that the country can’t pay. And the World Bank has given it bad advice, distorting its domestic development to serve foreign customers rather than its own growth. So we’re going to write down the loans to the ability to be paid.” That’s what happened in 1931, when the world finally stopped German reparations payments and Inter-Ally debts to the United States stemming from World War I

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  5. ” What we are now reading is the Fund position on Zambia, expressing deep concern on public debt- which, according to the Fund, is a key driver to the deterioration of the economy; putting us in danger of debt distress.”

    If only the government in 2011 had opted for the Windfall Tax, and not for more debt while the copper was being stolen. However the Eurobonds were created by the same family bank that controls Anglo-American Corporation and the IMF/WB.

    If only the IMF/WB would ever take responsibility for the economic disasters they create.

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    • @MrK:
      That is the mentality of a PF Cadre; what a coward losing bast.ard!
      Can you ever give one example of the disaster IMF/WB they caused? IMF/WB don’t rule countries and never go to countries. It is countries and our politicians that go to them to borrow money in the name of development but with with the intention of stealing in reality!
      Wake up you PF idyot!

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  6. …I want to assure Government that an IMF programme will actually do more good to economic stability and public support than harm…
    Is Chibamba Kanyama speaking on behalf of IMF? I thought that he left IMF sometime ago, three years now?

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  7. How the IMF caused the famine in Somalia in the 1980s:

    ILO: the IMF “Fund alone among Somalia’s major recipients of debt service payments, refuses to reschedule. (…) De facto it is helping to finance an adjustment program, one of whose major goals is to repay the IMF itself.”

    Google: Somalia the Real Causes of Famine

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  8. All about the Windfall Tax, which didn’t need to be paid off like the Eurobonds. Nor did it accrue interest. Nor did it add to inflation.

    Google: (STICKY) Chikwanda describes advocates of windfall tax as lunatics

    “Chikwanda describes advocates of windfall tax as lunatics
    By Gift Chanda
    Thu 22 Mar. 2012, 13:00 CAT

    “FINANCE minister Alexander Chikwanda has described as “lunatics” those advocating for the reintroduction of the 25 per cent windfall tax on base metals. And Chikwanda says people are becoming increasingly vocal because they haven’t seen any meaningful change since the PF ascended to power.”

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  9. All about the Windfall Tax, which didn’t need to be paid off like the Eurobonds. Nor did it accrue interest. Nor did it add to inflation. From 2012:

    Google: (STICKY) Chikwanda describes advocates of windfall tax as lunatics

    “Chikwanda describes advocates of windfall tax as lunatics
    By Gift Chanda

    “FINANCE minister Alexander Chikwanda has described as “lunatics” those advocating for the reintroduction of the 25 per cent windfall tax on base metals. And Chikwanda says people are becoming increasingly vocal because they haven’t seen any meaningful change since the PF ascended to power.”

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  10. This article is honestly very shallow, It’s shameful that Chinyama Kanyama should always go to such length raving off such cheap verbature so devoid of any analytical intellectually substance. It’s this simple, Zambia is already in a serious debt distress situation, period!

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  11. If Kanyama wants to learn the source of our problems, he should read Dambisa Moyo’s “Dead Aid”, that will make him stop making a stupid fool of himself like this. It’s disheartening sometimes just to see the extent he would go sometimes to expose his ignorance and stinking lack of how an economy really functions! This is economics you fool, it’s not chibwantu or musoya!

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  12. We have nothing to show for the Eurobondage money.
    What we need is a serious forensic audit on Eurobondage.
    Those who plundered the Eurobondage should be taken to task.

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  13. The article has a biased suggestion that Zambia must be borrowing from IMG instead and not anywhere else. Even when it means commission for you Mr. Chibamba lantana…..I think it’s important to take into consideration that Zambia is our home….and we must not consider our selfish interests before it. The problem that Zambia has is debts that can’t be paid….and again you tel us to call for borrowing….is that not like extending the burden of indebtedness? We are in this problem not only because of bad policies, but also because of bad conditions from our lenders like IMF. For example…it’s IMF that influenced the increase in electricity tariffs…..so now here we are with high costs of production stunted GDP growth……then because u knew where we would end up…u are back again…

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  14. There is nothing ruling out another 9/11(twin towers collapse)and IMF(international monetary fund)money could be used to plan and execute such an attack.In fact that is exactly the case with Sudan.Peter Carlos Hinds.

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  15. Ah!! Yawn.

    Cut and paste from that IMF mission of yester-year. All IMF reports have sounded like this. Even in the times of one Levy cherished in some quarters

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