Thursday, June 20, 2024

CBU Academician objects to the manner in which the Lusaka-Ndola Road will be financed

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Copperbelt University (CBU) academician Mwiya Songolo has opposed the manner in which the financing of the planned upgrading of the Lusaka-Ndola Road into a dual carriageway will be done.

Chinese group Macro Oceans Investment Consortium has been awarded the tender to construct the Lusaka-Ndola dual carriageway and rehabilitation of 45 kilometres Luanshya-Fisenge Masangano road under public-private-partnership.

According to information, financing institutions include the National Pension Scheme Authority (NAPSA) Worker’s Compensation Fund Control Board and Stanbic Bank Zambia Limited.

But Mr. Songolo, a lecturer in the school of mines, said the 25-year deal will only benefit foreigners and impoverish Zambians.

He charged that Cabinet coerced National Pension Scheme Authority (NAPSA) and Worker’s Compensation Fund Control Board to loan to the so called foreign investors money and make profit for themselves and repatriate that profit to their country.

Minister of Infrastructure Charles Milupi has been justifying that it is not the Government which will fund the US$577 million concession agreement for the construction of 327 kilometres of the Lusaka-Ndola Dual Carriageway under Public Private Partnership (PPP) model.

“Bo Milupi (Minister of Infrastructure) you are missing the point altogether. We are not disputing that NAPSA and Workers Compensation Fund Control Board should not invest their money, which is my money particularly for NAPSA where on a monthly basis I contribute from my salary through payroll. Yes I agree, my contribution should be invested by the NAPSA Board of Trustees. However, I would like to put it straight to you that you as Cabinet coerced these two Zambian institutions to loan to the so called foreign investors to use my money and make profit for themselves and repatriate that profit to their country. Your argument that we encourage Zambian investors to invest so that profit is retained in Zambia doesn’t hold any water at all uncle Charles.”

“A consortium allows two or more businesses to combine their capabilities when developing and delivering a tender. The primary driver of a consortium approach is that it allows for greater economies of scale, efficiency and effectiveness. Instead of getting a consortium that has money, you solicited people who only have US$10m. Where is the aspect of greater economies of scale here, uncle Charles? If anything, you would have done well if you encouraged Zambian companies the way you coerced NAPSA and Workers Compensation Fund Control Board to form a Zambian consortium. It’s only in that way would the profits made be retained in Zambia. Your insistence to justify this wrong decision is out of subjective rationale. How can you float a tender for PPP calling for investors to partner with and the investor convinces you to coerce your own companies and lend your money, people’s money to an investor who has nothing at all,” Mr. Songolo questioned.

The CBU don branded the PPP deal with the consortium as ill timed and a danger to the country.

“For the Lusaka Ndola Dual Carriageway you are saying GRZ is not paying any single ngwee but will be able to get a share from what the Consortium will profit out of the toll fees after paying the principal and interest to NAPSA and Workers Compensation Fund Control Board. Don’t cheat yourself, I and my fellow Zambians are the investors but we will not get the investment on return like you in CEC. The Consortium is not investing anything apart from being so clever to use our money and make us pay for the use of our money and for the profit accruing to the Consortium and a bit that will go to government out of that profit. The one investing is myself and my fellow Zambian citizens whom you have decided to impoverish through this PPP. I and my fellow Zambian citizens who contribute monthly to NAPSA will be compelled by your cabinet to pay high toll fees because it’s law enacted by Parliament. From these high toll fees, the Consortium will be able to pay NAPSA and Workers Compensation Fund Control Board their principal and interest. The Consortium will still retain much profit out of my toil paying high toll fees. NAPSA and Workers Compensation Fund Control Board will retain and use the profits from the interest on their principal and spend it in Zambia BUT for the Consortium, No. The Consortium’s gain or profit made out of my monthly contributions (principal borrowed) and profit for using my principal will be spent elsewhere because they are not a Zambian company. Don’t you see this uncle Charlie? At the end of it all, me who got you into government for my livelihood to be improved will continue in abject poverty because the toll fees will reduce my income not for one day or a year but perpetual,” Mr. Songolo said.

He continued:”So, then why did you get into government uncle Charles, to impoverish me and my fellow Zambian citizens further? Uncle Charles, my dear President HH and Finance Minister Dr Musokotwani, on this one, you have missed it badly and it’s a danger to the country. I and my fellow Zambian citizens have been insisting that we can develop our country Zambia using our own resources and the President should look at what we have instead of continued seeking of foreign investment. Now, in pursuance of FDI, you have ended up getting conmen to manage what we already have. You don’t trust that we could have established a consortium of Zambian companies to manage our own money. Wouldn’t it have been better for you to invite Zambian companies on board to form a consortium and facilitate for NAPSA and Workers Compensation Fund Control Board to lend it money unlike your urge to enrich foreigners? If a Zambian Consortium was to manage the toll fees and maintain the road for 25 years, wouldn’t that have been a great milestone? I’m very much disappointed on this one, uncle Charles. In fact if anything, Mopani Copper Mines should not have been struggling where to source US$300m because NAPSA alone has that amount from my monthly contributions. It will be folly if government finds a foreign partner to own shares in MCM when we have the people’s financial institutions with money to fund the mines so that the profits from copper are not repatriated.”

Mr. Songolo said the Chinese consortium does not have the financial muscle to bring in foreign direct investment into the deal.

“At the end of it all, me who got you into government for my livelihood to be improved will continue to be in abject poverty because the high toll fees will reduce my income not for one day or a year but perpetual. My income will be reduced to enrich the foreign Consortium who has borrowed my monthly contributions as a loan from NAPSA AND Workers Compensation Fund Control Board. So, then why did you get into government Mr President, uncle Charles, and uncle Situmbeko only to impoverish me and my fellow Zambian citizens further? My dear President HH, Uncle Charles, and the Finance Minister, my uncle Dr Musokotwani, on this one, you have missed it and you are taking the country on a wrong trajectory. I and my fellow Zambian citizens have been insisting that we can develop our country, Zambia using our own resources and the President should look at what we have and can do instead of continued seeking of foreign investment. Now, in continued pursuant of FDI, you have ended up getting a foreign Consortium without financial muscle to bring in FDI. Instead you brought the foreign consortium to manage our money which we already have because you are convinced that we can’t manage our own finances properly,” he said.

“Mr President, you don’t trust that through your facilitation, we could have established a consortium of Zambian companies to manage our own money. Wouldn’t it have been better for you to invite Zambian companies to come on board to form a consortium and facilitate for NAPSA and Workers Compensation Fund Control Board to lend it money unlike your urge to enrich foreigners? If a Zambian Consortium was to manage the toll fees and maintain the road for 25 years, wouldn’t that have been a great milestone in as far as the benefits accruing to Zambians? The profit that was not going to accrue to us in thi PPP would only be that which the company contracted to construct the dual carriageway will make. I’m very much disappointed on this one, Mr President and my two uncles. In fact if anything, Mopani Copper Mines should not have been struggling where to source the US$300m which my fellow Engineer Sakanya has been crying for because NAPSA alone has that amount from our monthly contributions. It will be folly if government finds a foreign partner to own shares in MCM and reduce the 100% shareholding from Zambians when we have the people’s financial institutions with money to fund the mines so that the profits from copper are not repatriated from the country,” Mr. Songolo said.

17 COMMENTS

  1. CBU Didnt they do the ZRA portal for a Said $$10 Million and its still in a big mess 2 years Plus down the line

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    • The point here is that academicians and other professionals who want to get parts of or some of their thinking adopted as government policy do more than just talking to the media. They formally engage the 0government in a persuasive way.

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  2. I hope Mwiya Songolo has sent a formal letter of objection to the Ministry of Infrastructure &Urban Development in which he points out hw the road project should be financed. He’s expected to do that because he’s part the enlightened persons in Zambia who should know how to petition a public office. Do u get it Mwiya Songolo? It’s either you put up or shut up.

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  3. ITS LIKE THE LECTURER IS NOT WELL VERSED WITH THE DYNAMICS OF COMMERCE IN ECONOMY. DOES HE WANT ZAMBIA TO GO OUT TO CHINA OR USA AND BORROW MONEY . MOST OF OUR INFORMATIONAL LOANS ARE LONG TERM PACKS, THIIS MEANS THAT, THE PRINCIPAL AND INTERESTS HAVE TO BE TAKEN OUT OUR COUNTRY. BUT WITH THIS ARRANGEMENT. THE PRINCIPAL AND THE INTEREST ON THE LOAN HAVE TO REMAIN IN OUR COUNTRY , OFCOURCE, THE CONTRAR HAVE TO BE PAID FOR WORK OF CONSTRUCTION AND MAINTAINING THE ROAD FACILITIES . THIS A BTTER OF ORGANIZING LONG TERM LOANS

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  4. THESE FUNNY ZAMBIAN ENGINEERS ARE A LET DOWN AND ARE JUST GOOD AT STORIES AND JUST TALKING ABOUT WHAT OTHE3 PEOPLE ARE DOING. IN ZAMBIA YOU WONDER WHETHER WE EVEN HAVE ENGINEERS FO EVEN TOOTH PICKS SEEN IN ZAMBIAN ARE FROM THAILAND. SO LET ECOLOGISTS CONTINUE WITH WHAT THEY’VE STARTED IN ORDER TO SOLVE THE PROBLEMS OF EXTERNAL BORROWINGS . LET PROPER ENGINEERS JUST COME IN AND DO THIEIR JOB AND BE PAID

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  5. Zambian companies even struggle to build a car park………..

    How are they going to form a consortium to build a motor way ???

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  6. ITS LIKE THE LECTURER IS NOT WELL VERSED WITH THE DYNAMICS OF COMMERCE IN ECONOMY. DOES HE WANT ZAMBIA TO GO OUT TO CHINA OR USA AND BORROW MONEY . MOST OF OUR INTERNATIONAL LOANS ARE LONG TERM PACKS, THIIS MEANS THAT, THE PRINCIPAL AND INTERESTS HAVE TO BE TAKEN OUT OUR COUNTRY. BUT WITH THIS ARRANGEMENT. THE PRINCIPAL AND THE INTEREST ON THE LOAN HAVE TO REMAIN IN OUR COUNTRY , OFCOURCE, THE CONTRAR HAVE TO BE PAID FOR WORK OF CONSTRUCTION AND MAINTAINING THE ROAD FACILITIES . THIS A BTTER OF ORGANIZING LONG TERM LOANS

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  7. Throughout Africa you find these “know it all like types” like Mwiya Songolo. They are theorist or as you refer to him an academic. in other words someone who has not got a practical solution to resolve things.
    The problem concerning this road has been going on for years without a Zambian coming forward to solve it and people complaining about the hazards, accidents and fatalities being encountered. Yet now when the government has come up with constructive solution you are seeing people like this guy writing all sorts of nonsense.
    Is it any wonder that our countries are so backward?
    My advice to guys like him is, look to be constructive or shut up

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  8. It’s a pity the way we look down upon our intellectuals. This is a good write up regardless of our past. There has to be a starting point on how we empower our local companies. We cannot perpetually condemn ourselves and rely on foreigners to uplift our economy. We will have to take risks. The foreigners laugh at us when they look see things like this. Let us remember that for Chinese companies to be what they are they have been heavily assisted by their government.

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  9. What is most annoying about this deal is that of letting the Chinese construction companies of the Ndola-Lusaka dual carriage way be the ones to recover the money that will be spent on the road when they have not brought in money to do the road but are using Zambian workers’ monies. Can the unpatriotic UPND government tell us why it cannot allow National Road Fund to be the one to collect the toll fees from which the contractors will be paid? Has National Road Fund not been doing this after all? Why not give the responsibility of maintaining the road for the period during which the contractors will have to be paid to Road Development Agency and other Zambian contractors?

  10. I think Mr Songolo should have googled and read what terms like Special Purpose Vehicle (SPV) mean when doing such projects and Macro Oceans is such SPV. This is NOT a Chinese consortium, the only role of a Chinese firm is construction and maintenance. The majority stakeholders in this project are Zambians. Toll fees collected will grow Mr Songolo and all NAPSA stakeholders funds. A number of educated guys are a disappointment in this country.

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  11. This kind of arrangement being pursued generates a lot of loopholes, which are unsealable, hence giving advantage to powerful invisible hand.

  12. Mr Songolo is 100%, Zambian contractors are merely sabotaged by Politicians who demand cuts. The capacity to make roads is there

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  13. The deal stinks !!!
    Why use NAPSA money and continue collecting toll fees for 20+++ !!!
    Find another alternative ways of upgrading the road or leave it as it is !!!!
    When you use the pppppp terminology, the deal is so convincing, but scrutinize the facts, it’s rotten to the core !!.
    Guy’s you are a let down!.
    Another one is busy offering farm land to Kenyans to come and grow maize(like we don’t get bumper harvest’s) , maybe it’s because of the current fertilizer prices which are just too high for the local farmers.who are the ‘paya farmers ‘ (PF)

  14. purported academicia? whiles there’s book knowledge and practice. the academicia has spoken too much leaving off the nittty gritty mechanisms.

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