Friday, March 29, 2024

Where is the Economic Recovery Plan

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By Sean Tembo – PeP President

1. There is little debate that our economy is in dire stress. It has been on a downward spiral for the past 2 years or so; partially due to the COVID-19 pandemic and partially due to mismanagement. Although economic pundits rarely agree on anything, l think we are agreeable that we need to turnaround our economy towards a path of growth, job creation, better standard of living and fiscal sustainability. Prior to the 12th August 2021 general elections, the then ruling PF administration put forward their Economic Recovery Plan (ERP) in December 2020. After reviewing the Government’s ERP at the time, we were not agreeable with it and on 21st January 2021, we unveiled the PeP Alternative Economic Recovery Plan for Zambia (PAERPZ). As we headed towards the August polls, we nudged the then main opposition UPND to unveil their ERP, especially given the fact that their President kept talking about his grand plan for turning around the Zambian economy. We wanted UPND’s ERP to be documented and shared with the public so that we could review it. But that never came.

2. Anyway, fast forward to the present day, UPND won the August polls and subsequently formed Government. They have been in office for slightly more than 3 months now. They have unveiled the 2022 National Budget in which there hasn’t been any significant economic policy shift compared to previous fiscal years, other than to give the mines a de facto tax holiday and to get on an IMF programme as well as embark on an expansionary fiscal drive which has seen the planned employment of 30,000 additional teachers and 11,500 additional health personnel in the 2022 fiscal year.

3. Our expectation was that the first thing which the UPND administration would do once sworn into office would be to develop an Economic Recovery Plan for Zambia. We expected such an ERP to have short-term, medium-term and long-term milestones, interventions and performance measures which would be implemented by Government with the overall aim of transforming our economy from the current downward spiral of economic stagnation, unemployment, high cost of living and general hopelessness to a new dawn of economic growth, job creation and lower cost of living over the next 5 years. We expected every subsequent economic policy by Government to fit into and advance the objectives of its ERP. We expected the 2022 National Budget and the national budgets of all subsequent fiscal years up to 2026 to fit into and advance the attainment of the ERP. We expected Government’s decision to get on or not to get on an IMF programme to be determined by whether such a programme would contribute to the economic recovery plan of our country. But where is the Economic Recovery Plan?

4. The failure by the New Dawn administration to develop an ERP means that there is no framework to guide the various economic policies and interventions by Government. When a country’s economic policies and interventions are not synchronized by a framework such as an ERP, they tend to be haphazard and in self-conflict. That means you will have one policy which is pulling and another which is pushing, with the net result being zero. But let us not speculate. Let us examine some of the recently implemented economic policies by the UPND administration and let us determine whether they have been consistent or in self-conflict.

5. One of the first things which the New Dawn administration announced to us after taking over the reigns of Government was that the coffers are empty. So if the coffers are empty, the natural next step is to fill the coffers, isn’t it? And the main way of filling our national coffers is by collecting tax isn’t it? And one of the few sectors of our economy which is doing extremely well at the moment, with copper at more than $11,000 per tonne, is the mining sector isn’t it? But instead of collecting as much tax as possible from the mining sector, why did the New Dawn administration give a de facto tax holiday to the mines? That is a self-conflict isn’t it? Whereby on one hand you are complaining that the coffers are empty and on the other hand you do not want to collect tax from the only sector of the economy that is doing exceptionally well and that is leaping supernormal profits?

6. Let us look at another example of economic policy conflict by the New Dawn administration. The issue of the cost of living. One of the main issues which the Zambian people have been complaining about in the past 5 years or so, is the high cost of living. Prices of commodities have been going up to much compared to people’s incomes. The cost of living is just too high and money is nowhere to be found. This cry is not only applicable to the low-income people in the compounds but even people mumayadi are complaining. Time and again, President Hichilema has sworn to reduce the cost of living for Zambians. But how do you reduce the cost of living by increasing the prices of key production inputs such as fuel and electricity? This is a self-conflict isn’t it?

7. Let us look at a third example. From a fiscal management point of view, the biggest challenge which our treasury has is the issue of the fiscal deficit. In simple terms, a fiscal deficit occurs when Government expenditure is larger than Government revenue. In fact, this is one of the main arguments put forward by the New Dawn administration for bringing in the IMF, so that they can provide fiscal support. But when you expenditure is larger than your income, you need to either reduce your expenditure or increase your income or both isn’t it? But for the New Dawn administration, they do the exact opposite. They increase expenditure by hiring 30,000 additional teachers and reduce income by giving the mines a de facto tax holiday. So how can Government expect to solve a fiscal deficit when their actions are actually increasing it?

8. All these economic policy conflicts which l have illustrated above, would not happen if the New Dawn administration had an Economic Recovery Plan to act as the main guiding framework for all economic policies and interventions. The failure by the New Dawn administration to develop an ERP means that their policy interventions are unlikely to be synchronized. They’ll implement a policy which pulls and another which pushes with the net result being zero. And in the midst of all this confusion, the Zambian people are suffering and getting deeper and deeper into poverty. And let us be clear about one thing here; these early failures by the New Dawn administration are not because they lack advice, no. We have always been very generous with our advice to this newly birthed administration from the word go. However, the biggest problem with the New Dawn administration is that they are too self-righteous. They think they know it all. However, their arrogance is not backed by competence. It is empty arrogance. The only question that remains to be answered is how long the Zambian people will tolerate this empty arrogance by the UPND administration in the management of national matters. Only the Zambian people themselves can answer that question.

26 COMMENTS

  1. This man is running mad due to desperation to turn from Zero into Hero. Kabwata will tell us soon! All these ramblings are useless. Which reasonable person does not see through this guy?

    The so call PeP is just a kamtemba which will not go anywhere.

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  2. Another ridiculously long unreadable article containing nothing but nonsense. The writer got 0.00001% of the votes during the election and ZERO parley seats, so he is TOTALLY IRRELEVANT

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  3. I only read 3 paragraphs and quit. It’s a waste of space to fill up your head with Sean tembo’s perfect world articles.
    The best Sean can do is just apply to be a political science lecturer at some university.
    This man is unrealistic. We in Africa not UK or USA.

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  4. Deal with the message, not the bearer.
    Issue based arguments please.
    The so called PeP is really spirally drilling down your incompetences and inefficiencies.
    So now sean here is the deal. IMF is the one in charge here. Bury the bally policies for he has to check whether whatever he does economically does synchronize with the IMF program. This is what causes inertia in Governments under IMF. Governments cease to function kamba ka program ya IMF. Sovereignty is captured. The IMF State capture is at play.

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  5. It is a known fact that we have a conman in state house. He pretends like all conmen to know all and that he is able to “Fix it all” this is going to turnout as a typical “ Chipante Pante” Govt. They promised “transparency” but only in the mouth of Vasco dagama. This is a nation it is not a football club where you hide your match plan it is being childish.

  6. ST haters need to understand that people like ST are known as opposition leaders offering issue based politics. What ST is saying will only make sense to a few who understand true multi party politics. UPND need Sean Tembo to keep them on their toes. Late president Mwanawasa was on record stating that he needed his fierce critic Micheal Sata at the time to tell him the truth. ST please keep up the good work, eventually something good will come out of the rubbish as perceived by some people. We salute your issue based politics but it will take time to undo the damage done to our people’s way of looking at things.

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  7. On the employment of teachers and health workers Ba Sean Tembo, your argument could have been that the money being lost through tax holidays to foreign mining firms should have been used specifically for this purpose rather than use borrowed money which is unsustainable to keep the new employees in employment. Secondly, Mr. Tembo should have taken issue with the employment of DCs as a drain on national coffers which could have been avoided. He would also have done well to point to the new positions created, i.e., permanent secretary to cabinet for special duties with two persons in post filled by party cadres as a further drain on national resources. It would be good to document the new positions created by the new government to show the wastefulness of this government.

  8. ST might have good ideas , but he completely lost his moral compass. When you call a sitting president as Half baked economist, incompetent, and other insulting words, you do not expect his government or followers to read anything from you. The door is completely closed. Those who are talking of “hating the messenger not the message” are just playing with useless theories. I personally do not read anything from Tembo. I just react to the comments.

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  9. The only thing that makes sense from Sean
    Tembos article is on tax exemption for mines.
    This I totally agree as copper prices at peak
    And Bally gives exemption.This is time to reap.When Zambians are tightening their belt
    And mines are loosening their belt.cancel
    The rebate immediately.

  10. @FutureZed ,
    I agree with your comments above, but please note that ST brought on himself those haters because of the approach that he took from the beginning. He disqualified himself when he started evaluating the performance of the new government just 2 weeks after HH was sworn in. His blaming of the new government at that time was unjustifiable and his tribal language was unwarranted. That is when he build a large number of haters, who thought he was being opportunistic and not being a real opposition.
    So ST should blame himself for NOT being strategic in his communication. He need to WORK HARD to win back the glamour he lost at that particular point.

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  11. @FutureZed ,
    I agree with your comments above, but please note that ST brought on himself those haters because of the approach that he took from the beginning. He disqualified himself when he started evaluating the performance of the new government just 2 weeks after HH was sworn in. His blaming of the new government at that time was unjustifiable and his tribal language was unwarranted. That is when he build a large number of haters, who thought he was being opportunistic and not being a real opposition.
    So ST should blame himself for NOT being strategic in his communication. He need to WORK HARD to win back the glamour he lost at that particular point.

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  12. LT nembwa yabo named Sean barking!!
    Zambians are now just chilling peaceful. This is first Christmas holiday without Sean Tembo beaten by Paul Monga thugs.
    This first holiday season without Kambwili involved in a fight with Lusambo.
    This Christmas is so peaceful, nobody is being whipped in bars and churches.
    This Christmas there will be no accidents on roads because drivers are calm, no pangas under their seats.

  13. @6 Future Zed
    ST needs to grow up otherwise people won’t take him serious….if you see some of his posts on his page very immature…it’s good to keep checks but I think now he’s doing it for attention seeking…he’s enjoying being in the limelight…Zambians don’t have time for dry jokes…people are suffering

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  14. I only skimmed through his carp………

    And already saw him complaining about increasing GRZ expenditure …………

    Yet he is ignorant to the fact GRZ will be saving almost $80 million pm by removing subsides on fuel and electricity………

    More rubbish different day from ST………

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  15. We need to challenge the things he is saying and not character assassination just because we don’t agree with what he is saying. We need to stop this hero worshiping of people and blindly agree with everything they do including wrong doing. ST is an opposition leader, it’s his job to scrutinise government policy and actions. This is something UPND didn’t do because they were pre occupied with getting into office. If UPND made so much noise whilst in opposition, we would have been spared some of these corruption cases which are being unearthed today. I believe out of the rubbish, something positive will come out of ST.

  16. We need to challenge the things he is saying and not character defamation just because we don’t agree with what he is saying. We need to stop this hero worshiping of people and blindly agree with everything they do including wrong doing. ST is an opposition leader, it’s his job to scrutinise government policy and actions. This is something UPND didn’t do because they were pre occupied with getting into office. If UPND made so much noise whilst in opposition, we would have been spared some of these corruption cases which are being unearthed today. I believe out of the rubbish, something positive will come out of ST.

  17. Lusaka Times really adores Sean Tembo! I have found him to be boring for continuing to be “irate” and “bitter” in his trying to “advise” or “criticize constructively” under the guise of exercising “checks and balances” to the New Dawn government that is still to set firm footing on the ground! Sean is typical of one criticizing the new leadership of not graduating into seasoned presidency before entering plot one! While the sauce is still simmering Sean Tembo takes a spoon and tastes then starts criticizing the chef who has the recipe for final result! LT are now a turn-off with their new found hero Sean! Maybe Home Affairs ministry must send him back to Botswana!

  18. Is it not this stupid Sean Tembo who was saying Bemba and Nyanja are the only official Languages in Zambia and not Tonga? He is stupid, he brought hate on himself. No sane person can ever take that imbecile serious, he so immature it hurts.

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  19. Sean Tembo in August this year, wrote and I quote” Bemba and Nyanja are the only official Languages in Zambia and not Tonga” end of quote, he is stupid, his head is void of any material he is an *****. He brought hate upon himself. His way of looking at things is primitive to say the least. No one can ever take that imbecile serious.

  20. You know what , being in opposition does not mean that you oppose everything that the government does. Sean is always opposing, always opposing, always opposing, i can see his bitterness. Sean is just bitter. Checks and balances does not mean always opposing, it means offering constructive criticism. Being realistic in your analysis. Not trying to get unnecessary attention for nothing.

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  21. Sean Tembo quick to judge a 5month old HH govt yet he kept quiet for 10yrs of PF driving the economy into the Misisi trash piles.

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  22. Opposing does not mean he is blocking progress. Sometimes what may look obvious to you and me may not be to others. When you oppose, you offer alternative facts so it’s up to us to make up our mind if we are being told the truth or not. Unfortunately ST’s job is as an opposition is to scrutinise government policy and to offer checks and balances otherwise what’s the point of multi party politics? Did UPND ever support PF on anything when they were in opposition?

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