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Thursday, July 2, 2020

PF Government Is In Very Serious Trouble. It Has Failed To Manage Its Debt

Columns PF Government Is In Very Serious Trouble. It Has Failed To Manage...

By Fred M’membe

After arrogantly failing to listen to the free advice of the World Bank, the International Monetary Fund and many others, including ourselves, to rationalise its borrowings and infrastructure projects, today this government has turned to Lazard, to lizards to advise on restructuring its $11bn foreign debts that have threatened to become Africa’s first sovereign default during the coronavirus pandemic.

The investment bank was hired on a $5m contract to advise on “liability management” of the country’s debt.

Zambia is facing $1.5bn of debt payments this year, more than its official international reserves as of January. Fitch Ratings cut Zambia’s credit rating to double C in April and said that default was “probable”.

Clearly, this government is in very serious trouble. It has failed to manage its debt. It has borrowed beyond what it can manage.

They are now looking for a scapegoat in Lazard. Tomorrow they will say, ‘We were advised by most competent institution.’

But we all know the right thing to do; we all knew they could not sustain the debt this government was accumulating from the most expensive sources. We are now looking for some institution to tell us what to do – at a fee of $ 5 million – even though they know already what is required.

Going to seek advise from Lazard, from lizards is also an indication that they consider our institutions – our Ministry of Finance, our central bank, our Ministry of National Planning, our legal ministry – not competent enough to provide correct advice. It is a vote of no confidence in those managing these institutions. This is an admission that as a political party, as a government they are not competent enough to manage our country’s economy.

Are they telling us that all our institutions – universities, research institutions, professional firms – are not competent enough to help manage this debt?

But how different is Lazard’s advice going to be from what has already been given locally and internationally? Even the institutions that we already know their purpose is to serve the interests of the powerful nations that dominate them – the IMF and the World Bank – gave them advise, right or wrong, but they overlooked it.

So now that they are in deep trouble they want to look for messiah, a saviour in Lazard! This government is going to pay Lazard $ 5 million to tell them what they already know!
This is what happens when leaders stop listening to advice and only listen to their own inner demons. They used to arrogantly brag that their government will not stop borrowing! Can they say that today?

We are reminded in Proverbs 12:15, “The way of a fool is right in his own eyes, but a wise man listens to advice.”

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42 COMMENTS

  1. Home Headlines
    Headlines
    No Zambian Financial Advisory Firm or Political Party Has A Track Record to Execute The Debt Restructuring Zambia Needs
    By Chief Editor – May 30, 2020 23 527 views

    Skyline photo of Lusaka, Zambia
    Economic Statistician Shebo Nalishebo says there is no Zambian financial advisory firm or political party with a track record to be able to pull off the kind of debt restructuring that Government needs.

    And Mr. Nalishebo says Zambia needs an experienced negotiator such as Lazard Freres of France, one of the financial companies in the business to help in restructuring its debt servicing.

    Mr. Nalishebo says the type of restructuring required, is debt rescheduling or refinancing which involves a change in an existing debt contract and replacement by a new debt…

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  2. Exactly Fred is right, this PF government is evil. They over borrowed and now that some loan repayments are due this year thus engaging the debt consultant…
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    They know that they have run out of cash to repay thr loans and indeed they want to apportion the blame on the consultant.

    I differed with Fred on many fronts but on this i agree with him.

    PF must go!

  3. Here are 5 signs that you might be dating a “man-child”:
    1.You have to pick up after him. …OPPOSITION AND NOW LAZARD HAVE TO PICK UP THE BROKEN PIECES A SIGN OF LACK OF TRAINING.
    2.Talk of children or commitment brings panic to his eyes. …ALL THIS DEBT MGT ACQUIRING IS TO AVOID COMMITMENT, HENCE THE PANIC.
    3. You incessantly nag. ..You feel that if you don’t remind him of what he needs to do, said he would do, or should do, he will never do it. You invariably find yourself disappointed and let down as he doesn’t follow through with plans or commitments. He tells you to stop nagging him.TO PF ANY ADVISE TO THEM FEELS LIKE NAGGING
    4. He avoids serious conversation. …REMEMBER HOW A BILL 10 DEBATE WAS ABRUPTLY STOPPED BY CADRES

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    • 5. His interests and friendships carry a middle-school vibe.SO PREOCCUPIED WITH DRIVING BUYING AND DRIVING RANGE ROVERS AND PUTTING ON CANDY COLOURED SUITS

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  4. I am sorry, but we are not impressed by the caliber of Opposition Leaders in Zambia. There is no way, someone should be celebrating a chance to rule by ill will. There is no sense if corporate responsibility. They should be joining in to help by encouraging their followers to join in the fight, not salivating. Very disappointing. We absolutely mhave no alternative Party fit to take over PF with adequate experience and simply….right of mind. Mediocre.

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  5. flag corruption scandals: 48 houses social security cash luxury presidential jet ambulances fire trucks mukula trees ndola-lusaka rd malawi maizegate fuelgate swaziland landgate zesco loans

    Bo Fled Membe, I miss your editorials in your ‘The Post‘. Some of what we are currently witnessing in this PF government is partly due to the fact that we don’t have a formidable newspaper that can expose their corruption and looting. The paper that digs deeper really exposed corruption. You guys had informers everywhere, including in State house. Not sure you used to write those editorial articles but they were really good (some suspect Kaunda, Malupenga, Aka or Saki used to write some of them for you).

    See the irony about this PF govt is you helped them come to power. And then they illegally shut your newspaper down… oh the irony! In Lozi they say ‘kuuta tau’ (which literally says raising a cub, a baby lion… it is nice, innocent and harmless but one it could turn…

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  6. You are just bitter over closure of your post newspaper, if Argentina a developed nation can engage larzad, who are we not to do the same with a company that can even do debt swap for us.

  7. it should beyond the usual article 5 but more about rebuilding market access for Zambia putting the debt stocks both intra and inter government debt stocks full analysis and re profiling marketable and non marketable debts setting up of a treasury integrated system portal between mof and boz for transactional and term and yield reports including real time assets and liability management its beyond article 5 but building on to reestablish value in those un re based Zambian assets often overshadowed by issues of debt overhangs

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  8. its expected that the gains in hiring lazard will result in savings in debt restructure ,rescheduling,cancellation and including redesigning the debt management departs among-st the respondents lazards will deliver that but also market access for refinancing There are better advisory firms with track record with capital and investments firm to reposition Zambians debt stocks but in this case amongst the respondents lazard gives you market we will offer individual advisory and understanding to lazards but individually our growing expertise though might be superio in some way may not achieve market access

  9. For instance i know what is needed to restructure and reposition including the reports ,security auctions environments settlements and reports reporting debts to the penny but still need lazard to validated and value to my assets and liabilities until we establish presence in international advisory services and lead investments to move treasuries to effect balance sheets our advisory will be of little value understand also various financing methods and way to access finance in those markets

  10. Perhaps what one should ask more is the management scope of work and reference it should beyond simple usual debt sustainability

  11. This is the nonsense you voted for.

    Scotland yard should be hired to locate and retrieve all the stolen money. That will be enough to pay back this debt.

    Lungu and his friends are corrupt and rotten inside out. He has even introduced his wh0re daughter Tasila to thiefdom.

    Your days are truly numbered.

  12. Pay retirees? First he shall pay himself from stolen gold by Islamist fundamentalists from Sudan. Then Tashila gets her share from Makula, then maybe ministers and their concubines, where is the money to pay retirees who are almost in graves. Just push them, no pensions after pushing. Issue and problem buried. PF rules

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  13. Member. The more competent people have explained why Lazard. Even the pòat failed to manage its debts with ZRA. They should have sort Lazard. THE ONLY POINT I am with you is why did PF accumulate so much debt against all advice, even from you?

  14. I’m personally sick and tired with PF cadres who like to say “there is no opposition in Zambia” or “there is no alternative to PF”. These pretenders are really insulting our intelligence. There is no shortage of Zambians who will do better than the PF. There is nothing novel done by PF. Simply borrowing money and frittering it away on bogus projects and then turning around to hire a company to clean up the mess is really mind boggling.

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  15. Patriot Abroad(3)
    Which sane person salivates at his own impending demise?You should be aware that people, especially those who advised against reckless borrowing have a right to be very annoyed.This debt burden has brought dire poverty to even those Zambians who had the skills of Lazard long before Lazard was heard of.
    People are advising you that your tyres and the road are not fit for your speed.And when you get them in a ditch,you don’t want them to scold you instead you scold them for not helping to get your wreck back on the road!When will you ever learn!?

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  16. When are you going to pay retirees? We want our money now as it will cause confusion when the next government steps in. Pay us now

  17. In simple terms. PF is incompetent. If it was we couldn’t have reached a point where GRZ decides to look down on our institutions and praise others as more educated than we are. Professors at all country universities at what level have U been put now? This action discourages confidence in our own education system. You can use that 5 million on the resources that our local institutions need to help you come out of this deliberately made mess.

  18. @Patriot Abroad: bingo!! That’s the reality in Zambia today-the opposition has succeeded in destroying the image of the ruling PF but have failed badly in providing alternative policies and ideas!! They rely on slander, lies and social media. They think they can bully every institution to force their way. In the end they get alienated from real voters and lose elections. Fred is not even on ward governance but he wants to speak like he has a significant number of mps and councillors across the country. Ba Fuledi mwalipwa!!!!!

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  19. What hogwash are you talking about. It is like you want to sound intelligent and yet only drivel is coming out. This copy and paste business just exposes your ignorance.

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  20. I hate Fred mmembe because he bought tribalism in Zambia, however we are in this situations because we voted on tribal lines,as result we ended up by picking up a wrong government, instead of giving the leadership to people.

  21. The opposition in Zambia can only win on social media…the real voters cannot be hoodwinked by the paid bloggers who don’t even vote but worships useless Opposition who think can bully anyone who doesn’t support them on this platform…Silent majority Zambians support the current Government and have no trust for useless parties with no ideological identity such as UPND which is the main opposition in Zambia

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  22. There is no need for PF to continue campaigning for 2021 because they have messed up the country big time nothing is good in Zambia starting from the economy to law and order in the country were cadres just storm the radio station at their will no police in Zambia even our soldiers are eating on the same plate with PF thieves this government is in very serious trouble they have failed 2021 they must go.
    Dununa reverse for sure scandal after scandal scandal after scandal scandal after scandal scandal after scandal scandal after scandal.

  23. There is no need for PF to continue campaigning for 2021 because they have messed up the country big time nothing is good in Zambia starting from the economy to law and order in the country were cadres just storm the radio station at their will no police in Zambia even our soldiers are eating on the same plate with PF thieves this government is in very serious trouble they have failed 2021 they must go.
    Dununa reverse for sure scandal after scandal scandal after scandal scandal after scandal scandal after scandal scandal after scandal.

  24. You campaigned for PF with your newspaper and you benefited from PFs free tax. Your lies led them to State House.

    Today, you want to sound as though you are a saint, you want to separate yourself from PF. You are equally to blame, you must apologise to the Zambians for having lied to them.

  25. Lazi, your comment is 100% true. This guy fred is the root to all our problems. He lied to zambians day in day out through his newspaper and with his propaganda made zambians to believe that there will be real development if we voted for a guy who was not fit for that office. Unfortunately people started believing what he wrote and gave pf the vote. Now hear we are today. You are the last person on this earth we want to listen to about pf.

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  26. @ Zambian Citizen, are you serious that the opposition has failed to provide alternate ideas??? The issue at hand is that PF borrowed in an unsustainable way and did not invest the money wisely hence the need for this Lazard thing. How many times did the opposition – particularly UPND raise the alarm that PF was driving the country to this same position?? You did then what you are doing now – insulting them, calling them bitter, accusing them of just wanting to tarnish the image of the country! Just accept that we have a failed leadership and that some who had more discernment saw all this nonsense coming. And yes, Zambia can definitely do better than this current corrupt PF crop of leaders!

  27. Lazi and A, by taking IDs you cannot hide your paid membership of tribalists Tonga Hyena Hakaide Hichhichhichi. Not PF and UPND are scourge on Zambia. As for debt let no Zambia pay any tax, let government come to standstill. Civil disobedience is the best solution to kick Perpetual Fools out of power and then locked up for good

  28. Mmembe is the main villain who brought us to where we are and the useless chap has not even apologised to Zambians. He did everything possible to propel a clueless vulgar human being to president of Zambia not because he was the best of the contenders, but because Mmembe saw that he could control him.

  29. Mmembe owes Zambians an apology for campiagning tooth and nail through his Post Newspaper to get Cycle Mata and the PF into Office. This was the begining of our problems


  30. Fred you are the one that brought Sata into power, a man who did not understand a single thing about Debt Management.

    You pushed Sata to quickly despatch the Sovereign Bond. Because out of that money, you benefited government loans to buy tracks.

    Today, you have not paid that money. And you wonder why PF is failing to pay back loans. When you still owe Zambia more than $35 Million in taxes to ZRA. This includes National Airports, Zambian Airways & The Post. Records are there to show.

    Just keep quiet!! Surely you are not the right person to run Zambia

  31. I think Mmembe was just jealous of HH, plain and simple! He knew HH was the man for the job but he just didn’t want him there. Coz how else does one explain away how an intelligent man like him (Mmembe) could not have seen through that that would be the biggest blunder in the history of this country. And I’m glad he had been one of people directly affected by his support for PF. He really does owe the country an apology for his short sightedness!

  32. I hope mmembe has learnt a lesson. He decampigned MMD when the economy was doing very fine. It took us more than 35 years to have such a good economy . But out of hate and mmembes use less ego, de campaigned MMD and we back where we started

  33. Thank you Mmembe fo having decampaigned the upndead. Right now they sound as silly as were when you were masquerading as a journalist.

  34. now is also to rethink the Zambian capital markets development strategy and build on capacity to network and move finances positively to Zambia

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