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Tuesday, September 27, 2022

IMF bailout has put finance minister Hon. Musokotwane in a terrible dilemma

Columns IMF bailout has put finance minister Hon. Musokotwane in a terrible dilemma

By Venus N Msyani

Finance Minister Hon. Situmbeko Musokotwane continue to struggle to clinch a deal with the International Monetary Fund (IMF). Resulting in a terrible dilemma:

Weather to face the camera and say sorry things haven’t turned out the way he expected or continue pushing and hoping.

Through infrastructure development, the previous government accumulated a lot of debt. Had tried to seek help from IMF to deal with the situation, unfortunately the negotiation failed.

After accepting to serve as finance minister under new dawn administration, Hon. Situmbeko Musokotwane put debt crisis on top of the agenda. He approached IMF for a bailout package.

Three months later it was reported that a three-year lending program worth $1.4bn has been agreed at a staff level.

The report led to early celebration in United Party for National Development (UPND) camp. Had they waited for the deal to be finalized, Hon. Musokotwane wouldn’t be in the current dilemma.

“Previous governments had tried “for seven, 10 years” to enter into an agreement with the IMF, but our team had concluded it within a few months.” President Hichilema boasted on social media.

About eight months later Zambians in limbo waiting for IMF bailout! Hon. Nakachinda is right, HH should learn how to take it easy. He is a cause of this bailout dilemma.

Economist and former Finance Minister in the MMD government and now Forum for Democracy Development (FDD) president Edith Nawakwi has predicted that the IMF bailout deal is not happening any soon.

If she is right, what would be left of Hon. Musokotwane? To save his career maybe the finance minister should just resign.

Another option is for the minister to face the camera and say sorry things haven’t turned out the way he expected than continue pushing and hoping.

Some administrations are difficult to work with and the new dawn administration is proving to be one of them. Hon. Musokotwane did very well under MMD. It is very surprising to see him struggling under UPND.

24 COMMENTS

  1. ARE YOU OUT OF YOUR MIND? YOU DONT READ THE NEWS. ARE YOU SERIOUS? YOU REALLY DONT KNOW THAT IT WAS APPROVED AND THE MONEY WILL BE DISBURSED BY THE END OF THE MONTH?? IN WHICH WORLD ARE YOU LIVING??

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    • @William Banda either you are behind or lack understanding – who told you it was approved – When government is on record few weeks ago that Zambia’s official creditors, led by China and France, agreed to provide financing assurances the country has been waiting for to secure final approval from the International Monetary Fund for a $1.4 billion bailout. That statement is does not the $1.4 billion was approved. It just mean that bene bandalama will not trouble Zambia for now to pay back what the country owes them so that the $1.4 billion from IMF which be approved.

      https://www.bloomberg.com/news/articles/2022-07-30/creditors-give-zambia-assurances-to-unlock-1-4-billion-imf-deal

      The learned MUST STOP UBUTUTU pa social media please read widely and understand before careless…

  2. I think this article has come 3 months too early. Indications are that the bailout from IMF will come through and I would only agree with this author at end of October 2022. Edith Nawakwi has been peddling lies about the Hatembos, I am not sure I would believe her on this one.

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  3. Be careful about this IMF loans. . There will be no more recruitment in the civil service. So those teachers who missed the boat will remain in limbo.
    The census is only for one month….So those thousands of youths we saw applying for counting jobs will start asking questions again. From August to December is graduation season from Universities and colleges. Hundreds of doctors, teachers , nurses etc will again be offloaded on the streets.
    Unions should brace for tough negotiations . With IMF a wage freeze will be implemented. No more salary increaments. The boys and girls at Ministry of Finance and BOZ will be rendered useless and chaps from IMF will come and camp in Lusaka to ensure terms of the loan are not violated.
    Watch the space …..we will have to tighten our belts

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    • Zambia does not have a choice. These stupid PF Kaponyas fell directly into a debt trap. They took loans for infrastructure projects that will never bring back money, and now that Zambia cannot repay them, the lenders are coming for their pound of flesh. That is how it is, and has always been. The US even built a secret bank to do this very thing, and sent its economic hit men all over the world to ensnare the likes of Indonesia, Panama, Colombia, Brazil, Mexico, Argentina, Zambia (under Kaunda) etc etc with these sorts traps. Once the countries could not repay those debts, they were forced to sell such prized assets as our copper mines, industries, Zanaco, etc etc etc. We were forced to sell land to foreigners… Now I am not sure what the shylocks will be coming for, but I suspect the…

  4. He is a stinky old corrupt man who is applying economics from 1970s. How can you develop with fossils. He is meant to have mentored young people but he is too greedy

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    • You are kalya-nyokos who left our country in the debt trap that he and HH haVE to deal with. You personally and Johnathan Mutawire aka Edgar Chakolwa should be arrested. You sold our country with that US $31 billion debt trap you put us into. What HH and Dr Musokotwane have to deal with with is the pile of STINKY SHYT you left our country in. You got you cut of the loot, and are in exile in the UK enjoying, while the shylocks your asses sold our country to are carving it up among themselves. Shut up. I hate you.

  5. This political commentator in the name of Venus N Msyani, has demonstrated something that SOME (many of them) of the Bloggers on LT do – they do not take time to educate themselves or read and analyze BEFORE running to comment or write an articles. Ignorance among the educated people belongs to one of the root causes of some of the problems in Zambia society.
    How else would one explain the above article? And LT loves such articles, do you know why?

    • They are not educated. Zambian education standards have drastically fallen. Its all there for everyone to see but we want to bury our heads in the sand.

  6. Why is it called a ‘bail out?’ It is not a bail out. This is not like what happened under the Jubilee 2000 when Zambia’s debt was written off. This is another loan but only helping Zambia to postpone payments on interest for a while. Remember that we were paying close to $2 billion in interest alone. This is the money that could go a long way in alleviating the problems that Zambians face. The PF government wer bad borrowers and that may be because the former President Edgar Lungu got 9F in Mathematics. He has no idea waht compound interest is.

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  7. The loan will come yes…..We have just not been told under what conditions. Going by what IMF loans are known for do not ignore comments @lower Zambezi. We shall have to tighten our belts.

  8. The loan is nigh……….

    IMF were making sure the UPND GRZ is not as reckless and a theiving GRZ like that lead by lungu………

    Infact there is no rush for the bailout……….

    Let UPND nail the fundamentals in the economy………….especially to do with import substitutions………

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    • Loan , bailout,………..same thing…..

      IMF and other financial institutions call it a bailout………..

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    • That’s being lazy. The two are separate.
      Zambia got a bailout during MMD when HIPC meant we had no more debt. It was written off.
      You accrue new debt and you want to call it bailout again?
      Unless you want to say Zambia continued to receive bailouts up to our current 20 billion debt which doesn’t make sense

  9. On August 24th Hichilema was graciously sworn in as HH7 and quickly appointed Hon. Musokotwane as finance minister, barely three days later, making him the longest serving GRZ officials in the UPND. His task was simple: lure IMF to bail out Zambia.
    The UPND’s biggest failure ( if any) so far is that the minister hasn’t clinched the loan yet. He is frustratedly maddened and irritated by how talks are dragging feet. This has embarrassed the president and the entire leadership.
    However, I can see a pin-hole light of hope at the end of the wall.

  10. Zambia the one country that celebrates a loan. ” Yippee! We have borrowed!! We’ll drink to it!”

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  11. That’s being lazy. The two are separate.
    Zambia got a bailout during MMD when HIPC meant we had no more debt. It was written off.
    You accrue new debt and you want to call it bailout again Unless?
    Unless you want to say Zambia continued to receive bailouts up to our current 20 billion debt which doesn’t make sense

  12. Our country is in a debt trap. It has taken useless loans that do not generate revenue, which it has not means to pay back. Our country is in a weaker position than when Kaunda was saddled with his own $6 billion debt trap, that they used to usher him out of office. These fools mortgaged our country, and we do not own the mines, the land or anything else we can batter with. Honestly, I am not sure how HH is going to pull this off. Even we take all the money we make a year, and pay it to them, we will never be able to get out of this debt trap in 50 years. This is the truth. The loans that Michael Sata took are so ugly. One Eurobond was for $1.2 billion. It required us to pay $10 million a month for 10 years, amounting to $1.2 billion. At end, we had to pay back the $1.2 billion…

  13. …..continued….. At the end we would have had to pay the entire $1.2 billion principle because the damn thing did not amortise. That means we would have paid double what we borrowed. He borrowed two, on every year after that, in the amount of $1 billion and $750 million. The total amount of those Eurobonds was $2.75 billion. This means we would have had to pay $2,75 billion in servicing fees and then again pay the $2,75 billion principle back, bor total amount of $5.5 billion, with the span of 2011 to 2023 when the last of those odious instruments matures. This is what these criminals did to us. This is to say nothing of the $27 billion these animals borrowed on terms which were just as ugly.

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