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Alba Iulia
Tuesday, December 6, 2022

Zambia under Hakainde Hichilema: welcome to the ‘homegrown’ dictatorship of the IMF and finance capital!

Economy Feature Economy Zambia under Hakainde Hichilema: welcome to the ‘homegrown’ dictatorship of the IMF...

By Azwell Banda

Satisfied that Hakainde Hichilema and his UPND friends in government mean business to carry Zambia forward towards complete loss of sovereignty from where Fredrick Jacob Titus Mpundu Chiluba failed, the IMF on the 31st of August finally declared that Hakainde’s government is fit to be under its full financial and economic tutelage under its extended “Credit Facility” for three years at approximately US$1.3 billion.

HH and his friends are gushing with glory and self-praise at achieving this enslaving ‘milestone’, under one year in office. Only slaves celebrate debt.

A core fundamental difference with the IMF structural adjustment programmes under Kaunda’s UNIP and the MMD of Fredrick Jacob Titus Mpundu Chiluba is that today, under Hakainde Hichilema, it is none other than the managing director of the IMF herself – Kristalina Georgieva – who has boldly, ignorant of the real truth in her statement, announced to the world in her congratulatory message to Hakainde that in fact this time around, the IMF economic reforms are “homegrown”. This is as it should be: Chiluba was after all incapable of consistently sustaining the IMF draconian economic reforms because he was not a beneficiary of its fruits prior to becoming president. Hakainde Hichilema is personally a proud beneficiary of the disastrous IMF programmes under Chiluba! This IMF programme was grown in his home.

Welcome to the new dawn Zambia under Hichilema, a Zambia with a ‘homegrown’ IMF mass impoverishing, natural resources plundering, debt escalating and sovereignty eroding economic reform programme. If you doubt the seriousness and accuracy of what I am saying, do trust none other than our most eminent purveyor and publicist of ‘foreign investors’ and global finance capital, Chibamba Kanyama, when he says: “Here is what government officials, political leaders and citizens should know from the moment you sign for an IMF loan: you are simply naked! There is a full requirement you disclose all government initiatives. You cannot spend money on any project outside what is agreed (the budget) and the IMF must know and possibly approve if there is any slight change to the plan. It is all about transparent dealings, openness to scrutiny, accountability and integrity. This is what the previous regime in Zambia feared. Full stop!”

Not too cleverly, Chibamba Kanyama does not make it clear that your “nakedness” is only from the eyes of the IMF, not the eyes of citizens of Zambia! It is only now after signing that some of the finer ugly details of the deal Hakainde has struck with the IMF are surfacing in the public domain: the full ’homegrown’ agreement was and remains largely known only at Community House. The IMF and our creditors repeated demands, pleas and written requests to both the government and the IMF of the details of the agreements and the memorandum signed with the IMF have fallen on deaf ears. IMF managing director Kristalina Georgieva therefore needs to be specific about the ‘home’ in Zambia she is talking about when she says the economic reforms are “homegrown”.

“There is a full requirement you disclose all government initiatives,” Chibamba Kanyama says. Again, he does not specify to whom you make these disclosures. To the IMF, of course, who, in fact do not actually need your disclosures because they already have several eyes and ears, and even mouths, planted in the Bank of Zambia, Ministry of Finance and other core ministries. Not content with this IMF surveillance, Chibamba Kanyama is in fact, of all weird things, calling upon our ‘civil society’ to also join the army of informers to the IMF, should the Zambian government threaten the programme by acting outside it!

Ask any of Hakainde’s ministers to give you the full details of the ’homegrown economic reforms’ and the full details of the projected benefits over the three years for the majority of Zambians: good luck with the quality of the answer you will get! Ask a second minister the same question and the inconsistencies in the answers will shine very brightly and blind you like the midday November sun in the Kalahari Desert.

Chibamba is right when he says: “You cannot spend money on any project outside what is agreed (the budget) and the IMF must know and possibly approve if there is any slight change to the plan.” The word “possibly” makes the reasoning irrational. The IMF must be informed about any proposed changes, and they must approve them, or the programme gets stuck, is suspended, and the drip, drip, drip money from the IMF stops coming!

The IMF is for policing the global finance system on behalf of the US, banks, and the rich. Zambians who care to know and remember recall the mass job bloodbaths, sicknesses and deaths under the IMF programmes – and the IMF would suspend their drip, drip, drip money transfusions at the slightest threat to their programmes. That the IMF programmes were never fully implemented is proof of the fact that the mass suffering, pain, and deaths Zambians experienced posed a political risk to those in government, and they had no choice but to abandon strict implementation of the programmes.

Chillingly, Chibamba Kanyama, obviously speaking also from our Zambian experience itself, says: “The worst thing you do not want to have as a country under an IMF programme is a suspension. It signals to the entire world that you have messed up. Investors panic and all those other cooperating partners freeze support. Your new position can potentially be worse than your situation before the IMF programme.” The ‘investors’ and ‘cooperating partners’ do not panic because your streets are becoming permanent sitting rooms for masses of unemployed young people and street kids and orphans, nor when you start running out of space for graves in your cemeteries as dead bodies keep piling up because of economic hardships.

The IMF sole purpose for existence is to ‘stabilise’ the finances of debt-ridden countries on behalf of official government creditors, commercial banks and other creditors. Unless a debt-ridden country democratically with its own citizens produces its own genuine ‘homegrown’ strategy and plan to stabilise its national finances and manage its debt by bypassing the IMF and forcing direct negotiations with its creditors, the IMF route becomes inevitable as it is a means to protect the money of the rich by extracting maximum possible value for them, by punishing the working class and poor of indebted countries with austerity and entrenchment of the dictatorship of finance capital.

All programmes of the IMF link an indebted country’s use of IMF resources to its adoption of a strict pro-private sector economic restructuring programmes, constriction of government expenditure, austerity, credit ceilings, restrictions on local and foreign borrowing, trade restrictions, exchange rate policies favourable to foreign investments, inflation targeting and other similar measures all designed to squeeze maximum value from the working masses and the poor in order to enrich the banks and creditors, through debt restructuring. A cosmetic sprinkling of ‘human rights’ and ‘democracy’ and ‘safety nets’, and lately, limited and controlled government spending on education and health for the ‘most vulnerable’ sweeten the sadistic loss of national sovereignty over economic and public policy, and national finances to the IMF and banks and other financial institutions.

Taken together, with the heavy policing of a country’s economy, budget and expenditures by the IMF, the creditors, once satisfied that the indebted country can sustain these measures and begin to accumulate ‘surpluses’ enough to meet its debt obligation on certain specified terms, may then agree to restructure terms for the country to meet its debt servicing needs. This is the essence of the IMF programme: a country cedes its economic and financial independence to the IMF in return for the IMF to strictly supervise the terms upon which the creditors are happy to have their money from the indebted country, managed.

Concealed in all this is that for the first time, as unlike Kaunda, Chiluba and all other presidents Zambia has had, this time we have a president who stands to vastly increase his personal wealth at the expense of millions of Zambians who are being made to pay the cost of debt restructuring, as he himself benefits from inflows of foreign money into the country, from commissions and by cheaply pawning our natural resources, to foreign money.

In truth, in Hakainde Hichilema we do have a ‘homegrown’ economic restructuring programme with the IMF: the programme was grown in the home of Hakainde Hichilema!

Welcome to the ‘homegrown’ IMF dictatorship of millions of working and poor Zambians!

Responses at: [email protected]

8 COMMENTS

  1. Ba Banda mulib3 nz3lu!

    Your convoluted article is not well reasoned, fully pregnant with politics and devoid of economic sense. You have failed to disclose what practical steps outside of the IMF should be taken to address the insummountable debt crisis you looked away from when Lungu was piling it up. And you sound clueless to the fact that the IMF deal will slash our debt to manageable levels..

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    • I remember this fake anarchist, Azwell Banda. He was the President General of UNZASU when I was a student, and his bitter resentment against the same Kaunda he praising today caused the closure of the university, after his demagoguery triggered a riot. Today he is claiming that Kaunda was the paragon of patriotism, but I remember watching him give a speech in the sports hall in which he derided president Kaunda, declaring in that “Human is the philosophy in which one man is at the center; and that man is Kaunda”. The reality is that Zambia is chocked in a debt trap. The Edgar Lungu this Azwell Banda never criticised (together with Michael Satan), from having a debt of US $5 OO million, to an unpayable $30 billion, on some of the worst terms ever agreed to by any government. The IMF loan…

  2. ” Only slaves celebrate debt” So we should not celebrate all those flyover bridges, unfinished hospitals and schools that PF goverment built with debt? Heroes Stadium, nkongole; roads, kaloba. The Author is a slave to his own mind, he can not escape it.

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    • HH found Zambia enslaved to foreign debt amounting to an unpayable US $30 billion. The IMF loan and its terms were terms he was forced to accept because of the debt he found

  3. LT as I have commented before, your journalism really ought to get better.
    How could your leading story be a bias opinion and not totally factual.
    I am finding more and more each day that the quality of your “journalistic” output is deteriorating.
    The quality of this persons output does not even merit publishing in a a second rate comic.
    It is about time these so called political commentators acknowledge the fact that Zambia is in a precarious financial position because of the incompetence and profligacy of past governments and drastic action is required to fix it.
    Question: Did President HH get Zambia into its current mess. Answer is: No.
    But he has to fix it.
    Stop trying to make people believe that the actions he is taking are unnecessary and excessive. They are not

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  4. We are all debtors, individually and collectively, one way or another. We borrow for a good reason but we don’t need to pay back the creditors by again borrowing. If we do that we enslave ourselves… IMF is a slave driver we all know that. Prudence ought to have taken precedence. Wait and see.

  5. Ooooh another of those defeated & bitter PF tribalist trying to sound educated with his street economics.

    Us the majority Zambians listen to the sound & educated advice of a very educated & successful economist, the President of the Republic of Zambia, HE Hakainde Hichilema. We don’t take advise fr street *****s masquerading as economics experts.

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