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TWO MEN have been fined K 2,500 each by the Vubwi Magistrate Court for allegedly smuggling 1,000 by 25 kilogramme bags of mealie meal in Vubwi District.
Appearing before Magistrate Pauline Mulenga on Tuesday was Masauso Tembo, a driver of a truck registration number NU 978 and Austin Banda, a lorry mate who were found with 1,000 bags of mealie meal along the Chigwe-Vubwi road.
Particulars of the offence are that on April 9th this year around 21:30 hours whilst acting together the duo allegedly carried the commodity while heading to Manota area near Malawi.
Upon reaching Msengeledzi primary school, the duo found a check point mounted by Zambia National Service (ZNS)who are part of taskforce on smuggling of maize and maize product.
The duo later after interrogation, admitted to officers that they wanted to smuggle the mealie meal into Malawi.
In mitigation, the two pleaded with the court to exercise maximum on them as they were the first offenders.
But passing ruling, Magistrate Mulenga said the offence committed by the two was rampant in the country.
She however convicted the two to pay a fine of K 2,500 each by April 25th or in default three months simple imprisonment.
Magistrate Mulenga said the mealie meal should be forfeited to the state.
And Patriotic Front(PF) Petauke District Youth Chairperson Jay Emmanuel Banda pleaded not guilty to two counts of assaulting Post Correspondent Peter Sukwa and his counterpart for Feel Free Radio station Kelvin Phiri.
Ms Mulenga adjourned the matter to May 17th for commencement of trial in the assault case.
In the same court, Magistrate Moses Phiri adjourned the defence in the case involving PF Vubwi District Michael Tembo to May 5th.
Hon. Gerry Chanda address UNGASS2016
Zambia has told the United Nations General Assembly Special Session on World Drug Problem (UNGASS2016) that it is committed to foster regional and international cooperation through the exchange of information, expertise and best practices on drug prevention and treatment mechanisms.
Delivering Zambia’s national statement, Home Affairs Deputy Minister Colonel Gerry Chanda said the world drug problem remained a major challenge for the international community.
He called for increased bilateral and international cooperation based on the principle of common and shared responsibility to effectively deal with all aspects of the scourge.
“While we appreciate that combating the world drug problem requires a balanced and integrated approach, calls for decriminalisation and legalisation of illicit drugs such as cannabis, are in our view against the spirit of the three international drug conventions,” Col. Chanda said.
The Deputy Minister said Zambia recognised the three International Drug Conventions and related Protocols as the cornerstone for effective international drug control and prevention.
He underscored the importance of achieving the goals and targets outlined in the 2009 Political Declaration and Plan of Action to counter the world drug problem.
“We reaffirm that these international instruments are sufficient in providing the required guidance and appropriate approaches in curbing the world drug problem,” Col. Chanda said. “While Zambia was previously used as a mere transit point for illicit drugs, trends have changed, as the country is now a consumer of drugs such as cocaine and heroin.”
He said the consumption of Cocaine and other hard drugs was on the increase.
Col Chanda said the Government, through the Drug Enforcement Commission (DEC), had continued to implement demand-reduction programmes through education and sensitisation of the citizens on the dangers of illicit drugs, counselling, treatment and rehabilitation of drug dependent persons.
“To provide early prevention of drug use among young people, Zambia has incorporated issues of drugs and money laundering in school curricula from primary to secondary school levels, including the development and production of Supplementary Readers on illicit drugs and money laundering,” the Deputy Minister said. “Government has initiated the youth development fund whose aim is to empower young people by helping to establish their own businesses and therefore, refrain from indulging in illicit activities such drug use.”
Col. Chanda said the Government has continued to undertake regular reviews of drug control legislation to address emerging challenges, threats, and realities and provide an integrated and balanced strategy in combating illicit drugs.
“To strengthen the fight against money laundering and other organised transnational crimes, Zambia has also established an Anti-Money Laundering Investigations Unit (AMLIU) under the Drug Enforcement Commission, which investigates all money laundering related offences,” said Col Chanda, who is accompanied by DEC Commissioner Ms. Alita Mbahwe and other senior Government officials.
The (UNGASS2016) adopted a new framework putting people at the centre of global policies on drug control. The Commission on Narcotic Drugs (CND), the UN’s top policy-making body on drugs, drafted the framework in Vienna Austria last month.
Hon. Gerry Chanda and DEC chief Alita Mbahwe at UNGASS2016Gerry ChandaD-MINISTER GERRY CHANDA AND DEC CHIEF ALITA MBAHWE
Zambia Police officersAlert Security officers in Luangwa District have intercepted 16 prohibited immigrants who were trying to use the Luangwa border to go to South Africa.
Luangwa Police Officer In-Charge, Assistant Superintendent, Mataa Muleta confirmed the interception of the 16 Ethiopian immigrants who were supposed to cross the Zambezi river to Zimbabwe enroute to South Africa.
Assistant Superintendent Mulata said the 16 Ethiopian Nationals, who entered Zambia through Nakonde border post from Tanzania, traveling in a Toyota Hiace mini bus registration Number ALR 1026, were apprehended at the Council Checkpoint on the Luangwa D145 main road at around 06:00hrs on Friday last week.
Mr Mulata said the driver of the Mini bus, Lenda Tembo and his co- driver, Prince Mulyata together with the 16 Ethiopian nationals tried to bribe
three police officers with K30,000, but the officers refused and brought them to Luangwa Police station were they are currently detained.
The Officer In-Charge further said the two Zambian Nationals, Mulyata and Tembo are detained for suspected human trafficking while the 16 Ethiopians are in police custody for illegal entry into Zambia and that they will appear before the court soon.
Meanwhile Acting Luangwa District Commissioner, Jairos Simukoko also confirmed the arrest of the 16 prohibited immigrants and the two Zambians.
Mr Simukoko commended the security wings and urged them to continue with the good so that human trafficking is reduced in the area.
He further commended Government for sending Zambia National Service officers to Luangwa to beef up security in the District which has experienced an increase in the smuggling of mealie meal and fuel to neighbouring countries.
The Acting District Commissioner said the coming of the ZNS officers was a welcome move as it has further helped to improve security in the District which borders two countries, Zimbabwe and Mozambique.
Fire engines splashing water on Kenya Airways aircraft to celebrate the airline’s inaugural direct flights on Nairobi-Livingstone route at Harry Mwaanga Nkumbula International Airport in Livingstone
KENYA Airways, which introduced a Nairobi to Livingstone route in 2013, has added a new destination to its network and will now fly to Cape Town South Africa.
And Zambia Tourism Agency (ZTA) Tourism Promotion Manager Jocelyn Mutinta said the extending of Nairobi-Livingstone route to Cape Town was a positive development to Zambia’s tourism.
According a press statement released yesterday, there will be three weekly flights between Nairobi and Cape Town beginning July 2016.
It will be Kenya Airways’ second city in South Africa after Johannesburg and will be linked to Livingstone in Zambia, the gateway to Victoria Falls.
The service will operate on Wednesday, Friday and Sunday.
Kenya Airways flight will depart Nairobi at 7.20 am, arriving in Livingstone at 9.30 am, departing Livingstone 10.20am to arrive Cape Town at 1.25pm.
Return flight would take off from Cape Town International Airport at 2.15pm, arrive Livingstone at 5.10pm and depart Livingstone at 6pm and touchdown Nairobi 10pm.
The statement states that Kenya Airways would be the only carrier to offer a direct service between Livingstone and Capetown and the route would offer excellent connections to the Kenya Airways network.
The route will be operated by Embraer E190 with a configuration of 12 business class seats and 84 economy class seats.
Kenya Airways’ Group Managing Director and Chief Executive Officer Mbuvi Ngunze said his entity was excited to add a new destination to its network.
“We continue to connect Africa to the world and the world to Africa. Cape Town via Livingstone will offer our guests two holiday destination on one route,” he said.
In March this year, Kenya Airways announced several flight scheduling changes that are expected to boost connectivity for passengers in Africa by at least 20 per cent.
Kenya Airways will now operate more hours of the day following the opening of the runway last month, thereby ensuring efficient use of its aircraft and crew.
“Through this, there is room for an increase in flight frequencies to some cities in its network, especially in Africa. More flights during the day make for more options to connect between destinations.
“The rationale behind this to augment operations as the company seeks to return to profitability in the next two years.
“In the last two years we have improved fleet utilization by 30% by re-looking at our schedule and enhancing it to suit our customer needs,” the statement stated.
And ZTA Tourism Promotion Manager Jocelyn Mutinta said the extending of Nairobi-Livingstone route to Cape Town was a positive development to Zambia’s tourism.
“This is a positive development because we already have tourists who usually come here from Cape Town and so it will be easier for them to travel.
“Further, the move will connect two world heritage sites namely Livingstone’s Victoria Falls and Cape Town’s Table Mountain and ultimately enable tourists to visit the two places easily,” Ms Mutinta said.
Apparently, the prescription of ceiling prices for maize and mealie-meal by the Zambian government is prompted by several factors. Firstly, it is designed to effect a more egalitarian distribution of the affected commodities than what would ordinarily obtain if prices were allowed to rise in response to the market forces of supply and demand.
Secondly, the majority of citizens would not be able to afford to maintain a decent level of subsistence in the absence of price ceilings, given the high levels of poverty in the country, and the fact that maize and mealie-meal are currently Zambia’s staple and principal foodstuff.
And, thirdly, the high levels of undernourishment, child mortality and child wasting and stunting obtaining in the country are not likely to be addressed in the absence of price controls on maize and mealie-meal.
Unfortunately, price ceilings on maize and mealie-meal are the major cause of the smuggling of the two commodities to countries where prices are higher than prescribed prices obtaining in the domestic market, and/or where there are inadequate supplies of the two commodities.
So, what is the long-term solution to the smuggling of maize and mealie-meal?
Simply, there is a need for the government to provide adequate support and incentives to agribusinesses and to both small and large-scale farmers. In this regard, the government needs to promptly take the following measures and initiatives, among other things:
1) Address the following factors identified by the COMESA Secretary General in 2000 as having contributed to the low levels of agricultural production in the country: non-availability of financial capital, and the high cost of agricultural credit; inadequate transport and storage infrastructure, and the high cost of transport; the under-provision and high cost of agricultural inputs; an inefficient agricultural marketing system; inadequate skills in agricultural production and marketing; inconsistent and unrealistic agricultural policies; and inadequate investment in agricultural development by the government.
2) Revive and revitalize the Zambia National Service (ZNS) production camps, which should accept enrollment by unemployed Zambian citizens on a voluntary basis, as well as promote and bolster agricultural production in the camps through greater financial support and generous conditions of service for ZNS personnel.
3) Utilize the vacated refugee camps dotted across the country for agriculture-related training, crop production, and other vocations to be facilitated by a cadre of skilled and professional trainers.
4) Require all provinces to create revenue-generating Provincial Agricultural Estates, and to use a portion of the output of the schemes to maintain their own local food reserves, and also require all district councils, educational and training institutions, police camps, military barracks, garrisons, and prisons to initiate and maintain agricultural production units.
5) Encourage resettlement schemes to produce more food by providing for irrigation dams and canals at all such schemes to facilitate all-season crop production, as well as provide for attractive agricultural incentives to boost both small-scale and large-scale agriculture-related activities. In this regard, there is a need for government officials to continually acknowledge the assistance rendered by donor countries in bolstering the viability of the National Irrigation Plan (NIP).
6) Continually provide information to farmers aimed at promoting efficiency in processing, sourcing and sharing of seeds, organic manures, and other kinds of agricultural inputs.
7) Spearhead the creation of a “Farmers’ Holding Company” by farmers (through a low-interest loan, if needed), to supply low-cost inputs nationwide at zero value-added tax—including seeds, seedlings, fertilizers, pesticides, insecticides, stock feeds, and grain bags. The cooperating farmers would need to assume ownership of the company as founding shareholders, and the company should preferably be registered and operated as a corporate entity.
8) Periodically maintain and rehabilitate existing feeder roads nationwide, create feeder roads in areas which do not currently have such roads, improve training conducted in agricultural research centers, and provide for low-interest loans for erecting secure storage facilities.
9) Provide attractive tax incentives to agribusinesses, and to processors and canners of agricultural produce.
10) Create—in collaboration with the Zambia National Farmers Union (ZNFU), the Millers Association of Zambia (MAZ), the Zambia Cooperative Federation (ZCF), and other relevant stakeholders—a marketing system for all kinds of agricultural produce designed to provide for the following: direct sourcing of such produce from farmers by millers, retailers and other industrial buyers; and procurement of unsold produce by the Food Reserve Agency (FRA) at wholesale prices for preservation and/or distribution to government institutions like boarding schools, colleges and hospitals.
11) Ensure that the various kinds of imports that are currently exempted from customs duty continue to enjoy the duty-free status—including fertilizer, irrigation equipment, irrigation pumps, tractors, machinery for soil preparation and cultivation, harvesting and threshing machinery, poultry machinery and equipment, fungicides, and herbicides. And
12) Support all kinds of agricultural pursuits and endeavors nationwide—including poultry, dairy farming, cattle ranching, fish-farming, horticulture, and crop husbandry—in order to boost the supply of agricultural produce, as well as expand the variety of foodstuff and lessen our over-reliance on maize and mealie-meal on our main menus.
These kinds of measures and initiatives can make it possible for us to attain greater levels of agricultural output, the greater supply of which can result in several outcomes. Firstly, it can culminate in lower prices of food, and in enhanced food security. Secondly, it can boost our beloved country’s food reserves.
And, thirdly, it can enable us to export excess foodstuff and, in the process, end the rampant smuggling of maize and mealie-meal to neighboring countries and beyond.
The author is a Zambian academic currently living in the City and County of Denver in the State of Colorado, USA.
VICE-PRESIDENT Inonge Wina
Zambia’s Vice-President Inonge Wina is today expected in London, United Kingdom at the invitation of the London School of Economics (LSE) to officiate at the 3rd Annual Africa Summit.
The London School of Economics and Political Science will host its Africa Summit on the Theme: “Africa within a Global Context: Thinking Beyond Investments” on Saturday 23rd April 2016 at the LSE. This years’ theme will focus on the inventive facets of Africa’s economics and Communities. The theme will explore ways in which African nations can capitalise on opportunities and better address significant challenges when positioned with the rest of the world.
The Vice-President Mrs Wina will deliver a keynote opening address and will aim to address the day’s programme panel discussion by aligning perspectives of how Africa can stay in that global standing, positioning Zambia’s standing with the rest of Africa and its trajectory to sustaining long-term wealth creation.
Panelists will discuss among other themes: inclusive economic management and sustainability; the role of microfinance and Foreign Direct Investment (FDI) as emerging markets in Africa; and new financial structures and fiscal policies steering Africa’s engagement with the global economy,technology and telecommunication sectors, participation of African citizens in local and global economies, governance and social movements, effectively and sustainably power Africa in the age of a global shift away from carbon-based energy sources; power infrastructure to foster industrialisation and economic growth; the role of traditional and renewable energy producers , as well as the role domestic and regional government actors play in the future of the African power sector and how technology may not be a panacea for Africa’s ills.
The Vice-President will also meet various investors as follow up to the Zambia-UK investment forum which she officiated last year in November.
THE revision of Zambia’s rating to B3 by Moodys’ will not have an effect on the interest payments of the Eurobonds, Finance Deputy Minister Christopher Mvunga has said.
Moody downgraded Zambia’s long-term rating to B3 from B2, changing the outlook to negative from stable.
The downgrade on the issuer rating was driven by greater-than-anticipated fiscal slippages in 2016, leading to material liquidity pressures and significant challenges to finance the Budget deficit.
Further, the prospects of additional deterioration in Zambia’s debt matrix in a lower growth environment, with Government debt, are likely to exceed 60 per cent of the Gross Domestic Product (GDP) by 2018.
Mr Mvunga, however, said that Moodys’ assessment had implications for the country as it may require to pay a higher premium on new borrowings from the international capital market.
“Their assessment has implications for our country as we may require to pay a higher premium on new borrowing from the international capital market.
“The revision, however, does not have an effect on the interest payments that we are paying on the three Eurobonds,” Mr Mvunga said.
Despite the generally held view that it would affect investor confidence, Mr Mvunga said this did not hold for Zambia as illustrated by a tightening yield on the current Eurobonds from an average of 14.5 per cent in February this year to around 12 per cent currently.
“Regarding the domestic market, we have limited exposure currently from foreign investment, hence there will be minimal impact associated with net portfolio outflows,” Mr Mvunga said.
He said the revision of the outlook did not necessarily mean the country would have to pay a higher premium in the international market, stating that it would be imprudent for the Government to continue borrowing externally at unsustainable levels in such a scenario.
“You may wish to note that this assessment by Moody’s is based on the assessment that we should be close to our peers in terms of future debt to GDP accumulation,” Mr Mvunga said.
He said debt sustainability remained Government’s key objective, hence enhancing of the debt management capabilities, including the periodic undertaking of debt sustainability analysis.
He said the country’s debt stock stood at US$6.6 billion, a marginal rise from $6.4 billion, representing 38.7 per cent of GDP in December 2015.
Zesco United head into the 2016 CAF Champions League group stage draws in the company of seven ex-African champions.
George Lwandamina’s team is the only one of the eight team’s heading into the May 24 group stage draws never to have won the African title.
However, Zesco remain the only Zambian club to have played in the league stage of the same competition.
Nkana and Zanaco campaigned in the 2014 and 2010 editions of the Confederation Cup respectively.
Meanwhile, Zesco’s prospective group stage opponents include record 8-time champions Al Ahly of Egypt and their compatriots and five-time winners Zamalek.
2003 and 2004 champions Enyimba of Nigeria are also through.
Wydad Casablanca of Morocco, DR Congo side AS Vita, ASEC from Cote d’Ivoire and Algerian club ES Setif, all with one win each, are also through.
The teams will be drawn in two groups of four and will play each other in a league format for a place in October’s semifinals.
Defending champions TP Mazembe were knockout of the competition by Wydad who drew 1-1 in Lubumbashi on Wednesday to advance 3-1 on aggregate.
Mazembe have been demoted to the Confederation Cup last 16 for a place in that competitions’ group stage where they will play Stade Gabesien of Tunisia who eliminated Zanaco 4-1 on aggregate on Tuesday.
MMD President Dr. Nevers Mumba speaks to the Clergy from various congregations at Victory Ministries in Kasama on 11th February 2016
The embattled Movement for Multi-party Democracy (MMD) President Dr Nevers Mumba has called on members of the party to ignore the announcement that there will be a convention between the 20th and 22nd of May.
Speaking when he addressed the media in Lusaka Thursday, Dr Mumba said there are people who are using blood money to ascend to the presidency of the party by all means.
In an apparent reference to the Mutati faction, Dr Mumba said some people are using the money they are getting from what is happening in the country to fight his presidency.
He wondered how the Mutati faction has suddenly found money to litter around when the party has been struggling financially.
He further said it was irresponsible for some individuals to pick venerable people from streets and portray them as MMD members when in fact they were not.
He described the faction as imposters who are being used by known elements to take over the party and that he will not step aside because he is the legitimate President of the party adding that no amount will be able to buy the party.
The MMD president further said that the MMD is the party that is holding the political balance for the outcome of the August, 2016 General Elections, hence the wrangles in the former ruling party.
Dr. Mumba revealed that the continued fighting was as a result of the well-known strategic position the MMD holds ahead of the general election.
He said it was therefore not shocking that suspended National Secretary, Mwansa Mbulakulima and others facing disciplinary action from the party, have now re-grouped to use fraudulent and criminal means, including forging documents which they presented before a Court of Law to attempt to take over the leadership of the party.
“The presiding High Court judge examined the documents presented by suspended National Secretary Mbulakulima and ruled that they were improperly filed in the Court and had no legitimacy and therefore refused to sign the Order of Consent to allow the group hold a convention,” Dr. Mumba said.
“It is therefore shocking that upon emerging from the hearing which was held in chambers, Mr. Mbulakulima addressed his rented crowd outside to inform them that the Court had issued a Consent Court Order permitting them to hold a convention and that all the suspended and expelled members had been re-instated, when in fact not,” said Dr. Mumba
Dr Mumba explained that the reason for the briefing was to assure members of the MMD and the nation at large that the party was still intact and in full control under his leadership and the Nec and that expelled and suspended members are just playing immoral politics.
“This meeting is to tell our members nation-wide who have been following these events since yesterday that our colleagues lied before the Courts of law and actually committed a criminal offence by lying that the Court had issued a Consent Order for them to hold a convention when in fact not,” he explained.
Dr. Mumba said it was unfortunate and total mischievous for suspended and expelled members to even set the dates for the convention when the party’s National Executive Committee (NEC) resolved not to go for a convention.
“It is criminal, they set a date, all that is fraudulent, criminal and extremely unfortunate for people who want to be in leadership to do that. We want to confirm with our general membership that they must disregard the action with the contempt it deserves; I am president of the MMD and your NEC is still intact. We are not holding any convention as suggested by our colleagues,” he reiterated.
“All they want is power, they have no structures. We are in charge of the MMD as NEC and we made a decision that the convention will be deferred until after the 2016 general elections and that decision stands; every resolution we made stands; so we ask our members to disregard all that is going on with our colleagues because it is just a side-show.”
He said the MMD exists as a party and will strongly participate in the forthcoming general elections, adding that this weekend he would be touring provinces to inspect on the progress the party has made in identifying people to contest in various constituencies on the MMD ticket.
Dr. Mumba said he was now hopeful that, the party has gained strength to be able to stand firm in readiness for the elections.
President Edgar Lungu says it is shameful that some politicians and commentators have dismissed the recovery of the Kwacha and drop in the inflation as a political gimmick which will not last
Speaking when he officially opened the sixth Zambia International Investment Forum in Lusaka today, President Lungu says no leader seeking prosperity for the masses must always programme their mind to expect negative trends in the economy.
President Lungu says no one must take pride in national failure as an opportunity to gain political success.
He has since assured the nation and investors that his administration has the full confidence in the leadership of the Bank of Zambia which is why they allow them the necessary autonomy to execute monetary policy as professionally as they can.
President Lungu says the central bank’s measured response during turbulent times of the Kwacha is now paying off.
He adds that the synergy between officials handling fiscal and monetary policy gives him even greater confidence that the country is on a recovery path.
President Lungu states that this is evident from the increased investor interest in government securities and renewed confidence in the mining industry.
And President Lungu has called on investors to partner with government in developing infrastructure such as roads,rails,hydro power stations,tourism infrastructure and others in public private partnership arrangements.
He says in order to achieve meaningful sustained development; the right infrastructure must be in place.
President Lungu has since urged investors to take advantage of the favourable investment climate and invest in Zambia.
Meanwhile President Edgar Lungu has urged the international community to harness Zambia’s investment potential and increase investment in the country.
The Head of State made this appeal when he received letters of credence from High Commissioners and Ambassadors accredited to Zambia from the United Kingdom, Djibouti, Guinea and Venezuela.
President Lungu says Zambia boasts of a conducive environment for doing business with numerous investment opportunities in priority areas of Agriculture, Tourism, Manufacturing, Energy, Mining and Water Development and other development sectors.
He adds Zambia attaches great importance to her relations with other countries, which are based on a firm foundation of mutual trust and respect.
President Lungu adds that government appreciates these relations which have played a role in positively impacting on the lives of the Zambian people.
Those who presented their letters of credence are UK High Commissioner to Zambia Fergus Obe, Djibouti Ambassador to Zambia Mariam Goumaneh, Guinea Ambassador to Zambia Djigui Camara and Venezuela’s Ambassador to Zambia Lourdes Martinez.
President Lungu apologises for Xenophobic attacks, visits foreigners squatting in a Church
President Edgar Lungu this morning visited the over 300 foreign nationals who have sought refuge at Kalemba Hall at St Ignatius Catholic Church in Lusaka.
President Lungu who made the impromptu visit around 11:30 Hours apologise to the affected foreign nationals for the attacks.
The foreign nationals are mainly from Rwanda, Burundi and Congo.
Addressing the affected people, President Lungu said he was ashamed that some of his citizens can take to such criminality to attack foreigners.
“I take full responsibility on behalf of the Zambian people. I also assure you of full protection and security of your person and property,” President Lungu said.
He emphasised that the senseless violence in some parts of Lusaka are acts criminality rather xenophobic.
President Lungu Sata he will work with the UN and church to resolve the matter.
United Nations Resident Coordinator Janet Rogan and UNHCR Representative Laura Locaastro and Catholic Priest Fr Charles Chilinda accompanied President Lungu.
The numbers of people mostly women and children flocking to the drop in centre at Kalemba Hall which was opened on Tuesday has continued to rise.
Father Chilinda said the Church has continued to take in more people but that the situation has now overwhelmed the Church as it is now struggling to provide for their supplies such as water and food.
President Lungu Greets a Grade 5 Pupil a Victim Of RiotsPresident Lungu Greets Riots Victim at Kalemba HallPresident Edgar Lungu Being Briefed at Kalemba Hall
Implication of the Downgrading of Zambia by Moody’s
The international rating agency Moody’s has downgraded the rating for Zambia as an issuer from B2 to B3. The agency has also changed Zambia’s economic future outlook from stable to negative.
What are the implications of these changes?
Firstly, this means that global financial institutions will be skeptical about Zambia. The higher perceived risk means the interest rates of lending to Zambia will be increased, thereby making our external debt more expensive to service through higher charges. Bear in mind that our Ministry of Finance already needs to pay around US$21 million each month on the interest alone for the three Eurobonds contracted under the PF Government.
Secondly, the current holders of Kwacha denominated instruments will get rid of them. This will mean the weakening of the Kwacha. So the little gains made by the Kwacha over the last fortnight will be eroded.
Thirdly, in a bid to stem this, the Central Bank (BOZ) will have to increase or maintain our already high interest rates. This means that access to credit by local businesses, especially our Small and Medium-sized Enterprises (SMEs), will remain difficult, holding our economy and job creation prospects back. Banks will likely increase their interest rates further or cut borrowing altogether in the context of the uncertainty around further spending by Government, especially during the upcoming election campaign period.
In its statement, Moody’s has attributed this fall in the rating in large part due to problems with fiscal policies, especially Government maintaining high levels of expenditure despite reduced income. This strain on the budget has been made all the greater due to the failure of Government to put in place policies that can generate more income to the state.
Yields on Zambia’s US$1.25 billion Eurobond sold in July have climbed to 11.4 percent from about 9.4 percent at the beginning of August 2015. This is a result of increased pressure on yields meaning that investor expectations of profits are high because the risk is high. A similar situation can be observed on the Kwacha that has depreciated by 41 percent against the dollar this year, more than any of the 150 currencies tracked by Bloomberg.
The reaction from the Government and the Ministry of Finance is a laissez faire approach, meaning that they want to treat this as business as usual. The PF is seeking to hoodwink the people into thinking that things are normal and that the Government is in firm control of the country’s finances, while it increases expenditure in the run up to elections. This is a betrayal of our local entrepreneurs and SMEs, of hard working citizens, those looking for jobs, and our children who will be the ones paying back these escalating debts for years to come. The time has come for a Government ready to face up to economic realities and take action to protect our future.
Geoffrey Bwalya Mwamba
UPND Vice President for Administration
Given Lubinda
PARLIAMENT heard yesterday that Government did not ban the export of maize to its neighboring countries.
Agriculture Minister Given Lubinda told Parliament that at the beginning of this month his permanent secretary announced a suspension of the issuance of export permits to allow for carrying out an audit of maize that was held especially by the private sector to avoid a situation where FRA maize was also exported dubiously.
Mr Lubinda said when he previously announced the release of maize by FRA he had indicated that the private sector was holding onto more than 200, 000 tons of maize and that maize would be allowed for export from the Ministry of Agriculture.
“There was no ban that was made. In accordance with the Food Reserve Act, a ban on exports of any food item would have to be by way of issuing a statutory instrument,”
He said that after the stocks were verified, government announced that the issuance of export permits had again commenced.
Meanwhile, Mr Lubinda told the House there was a leader of some opposition political party that misled the world when he lied that government had sold all its maize to its neighbouring countries.
Mr Lubinda told Parliament he was shocked to see a leader of the opposition political party featuring on the British Broadcasting Corporation (BBC) news misleading the world that Zambia had exported all its maize at $200 per metric ton.
He said lies should never be a mark for leadership quality by misleading the world through international media.
“Mr Speaker, we ought to aspire for the leadership of the country on the basis of the truth,” Mr Lubinda said.
He said the statement issued to BBC by the opposition leader was misleading and alarming in nature.
Mr Lubinda said people who were bent on telling lies should never be voted into office.
