PRESS CONFERENCE BY THE NATIONAL RESTORATION PARTY

Our invitation

Ladies and gentlemen, it is with a sense of deep concern that I welcome you to our press conference this morning. We have called this press conference in order to highlight the current and looming political and economic disasters facing our nation and to set out our comprehensive proposals on the way forward if we are to properly mitigate the impending catastrophe.

Our nation

Where is Zambia today?
Imagine the scene of an impending car accident: the driver of the vehicle last renewed his licence in 1964, having learned how to drive in a ‘Datsun 120 Y’. Moving recklessly and at high speed in a populated area, the driver continually ignores all the speed signs, road blocks and cries of frightened onlookers as he crashes through their thatched homes and small business stands. The only people that seem unworried are the passengers that the driver has invited into his car. Before long, it becomes clear, even to these complicit passengers, that at any minute a serious accident will happen.

This is what has become of our nation:

• democratic rights and freedoms are being violated on a daily basis;
• demands for a people-driven constitution are being ridiculed and brutally suppressed;
• chiefs are being routinely insulted and their traditional authority undermined
• corruption is rife – perhaps more so than ever before
• the kwacha is falling through the floorboards making the dollar that we depend on for our imports more expensive and therefore threatening the already highly stressed lives of the poor and vulnerable and all the while, our driver is whistling to himself with a car full of nervous passengers wondering which of them will be the next to be reshuffled or fired.

So how do we put the breaks on such reckless driving? Let us start with our constitution.

Our Constitution

Earlier this week, our republican vice president Mr. Guy Scott, was reported as having stated that Zambia needs a good leader more than it needs a good constitution. Quite why he was prompted to utter these words is open to speculation. One thing, however, is crystal clear: right now Zambia has neither a good constitution nor good leadership and the chances of either of these situations changing before the next election remain very slim unless the people rise up with one voice to demand what was promised by the very people resisting this request today.
To remove any doubt about this issue, let me make it clear that the people are demanding a new Constitution not because it was so publicly promised by the Patriotic Front while they were in Opposition, but because because a new Constitution is the one thing that assures us that people will not be taken for granted by so-called leaders who wield far too much power over their lives.
The constitution is not a document that is supposed to empower a few individuals and their supporters. It is a document that should ensure natural rights to liberty and protect the rights of all persons to pursue their dreams and aspirations regardless of which political party they belong to or what part of the country they hail from.
The reality of the situation is that the Patriotic Front have no intention whatsoever of giving the Zambian people a new constitution before elections in 2016. They will only do so if they significantly water-down some of the provisions that would undermine their own ability to hold onto power such as the 50%+1 threshold for victory by a presidential candidate and the need for each candidate to have a running mate.
But to hold back the introduction of a document that can ensure that democratic principles are truly upheld and thereby increase the chances of more equitable development just so that concentrated power can be used to promote the survival of a ruling elite, is both unpatriotic and a product of backward thinking. Perhaps we should think of changing the name of the ruling administration from PF to UB – “unpatriotic backward thinking”.

Our Kwacha

The recent rapid depreciation of our local currency against the major world currencies is both shocking and worrying. Shocking because of the speed at which the kwacha is losing value; worrying because being a highly import-dependent economy, every time the kwacha loses this amount of value, the costs of goods and services goes up significantly and almost immediately. It may only be a matter of time before we see increases in fuel prices, transportation charges, commodities, foodstuffs and basic services.
Our people have been battered by the storms of subsidy withdrawals and will have to face yet another storm of price rises due partly to the haphazard manner in which we are being governed. In fact, one of the few things the PF administration seem to have done with alarming consistency during their term in office has been the hiring and firing of senior government officials. Many have been in the unenviable position of being fired even before they have taken up their official postings. So not only is the car being driven recklessly, it seems it is also misfiring.
Unemployment remains high, our budget deficits are well beyond planned amounts and the lack of transparency in national contract negotiations creates huge additional costs for our development. All of these things have a bearing on the confidence a nation needs to project in order to ensure currency stability.
No one doubts the negative effect of declining copper prices on the international markets. Nor could anyone have prevented the strengthening of the US dollar and global reactions triggered by events in the Ukraine. But these factors do not excuse us from being the one country that has the worst levels of currency depreciation in the world after possibly only Ukraine.

Our vision for Zambia

In the midst of all these chaotic developments, we must, as a nation, maintain a belief that things can and will get better – but only if, collectively, we determine in our hearts that we want to build a better Zambia together.
We need to keep asking ourselves the important questions: What is our vision as a nation? What sort of country do we want our children to live in? The hard truth is that too many of us don’t really seem to know or really care. Too many of us sit on the sidelines hoping someone else – some politician within the Opposition ranks – will do the heavy lifting for us all. This is not how we will become a great nation. This is not how we will realise our potential.

We have to stop taking chances borne out of frustration and start making choices based on reason and consideration. We have to put aside our knee-jerk reaction of voting people into power without demanding a full explanation of their vision for our country and how they intend to realise it.
In 1991, we voted UNIP out of power because we wanted to feel the fresh new breeze of democracy after 18 years of one-party rule. 20 years later we voted the MMD out of power because not only had they also been in power too long, but they seemed to have forgotten to carry the people along with the economic development they seemed so proud to proclaim.

The MMD had not only stayed in power too long, but they had failed to sustain a vision that could be understood and shared by all and were seen as being too corrupt.

In 2016 the PF may well be voted out of power solely as a result of its failure to deliver a new people-driven Constitution, in spite of their attempts to dominate the national media platforms with their propaganda.
As NAREP we see a better Zambia. We see a country with selfless leaders building on the foundations of our predecessors. We are determined to avoid the situation in which we see every political party that forms a new government start afresh as if the others did nothing good. UNIP and MMD have both left a permanent mark on the country. We want to adopt the beliefs that they were clear about; the beliefs that resonated with the Zambian people, and build on that foundation. Our collective legacy is more important than ever in the year in which we reflect on our achievements and in the challenges that lie ahead, 50 years after our independence.

Our Year of Jubilee

We applaud the PF for acknowledging the fact that it is the God of the Bible who has faithfully led us since we the time we secured our Independence. As NAREP we are grateful to God for the absence so far of war and life-threatening civil disobedience. We must never take this for granted but we must all work hard as a nation to keep the peace. This is as much a responsibility of citizens and it is of governments. Therefore nothing should be done to close the democratic space we fought so hard in 1991 to secure. Former presidents Kaunda, Chiluba, Mwanawasa and Banda should all be recognised for building and strengthening this legacy. The intolerance we are witnessing with the PF today is eroding all that was achieved by our forebears.
Jubilee is about starting afresh – it is about getting into new and more equitable contracts with investors; it is about redeeming our land; it is about laying a new foundation on which we will build our nation for the next fifty years and beyond. In declaring the year of Jubilee the PF has given us a blank check by asking the people of this nation to define how we can make this period meaningful for ourselves and our children.
I believe that the institution that can help us determine how best to observe the Jubilee is the church. We call on all the church mother bodies and other stakeholders including those within the private sector to take up the challenge to provide leadership on how we can make Jubilee an impartial and meaningful event, not just a day of marching and long speeches.
As NAREP we believe that Jubilee is not a time to celebrate but a time to reflect on what is best about Zambia and how we can harness this for the good of all not just for the privileged few. We call on the church mother bodies to use this opportunity to guide our nation towards more inclusive and less acrimonious politics. It is sad to note that our children and grandchildren now think that what politicians do best is insult each other. Our current approach to politics makes it difficult to attract some of our best people whose talents could be used to fundamentally change our nation for the good.
In the midst of major obstacles to development like unemployment, inequality, lack of access to decent and affordable healthcare, vulnerability – especially of orphans and unsupported and unprotected children, politics ought to be about using power for the benefit of the people. Politics ought to be about ideas, public service and sacrifice. That is what Jubilee is all about and it requires our churches to take a leading role in promoting this important dialogue.

Our Churches

The church is a key partner with the government in the development of our nation. Several of our first national leaders were educated through the efforts of the church. When our colonial government discriminated against the indigenous population, particularly in the area of health and education, it was the church, working largely through missionaries, that filled the gap.
Today the church continues to provide various services that are helping us meet the Millennium Development Goals and our desire as nation to see more equitable development. Today in our communities, churches are supporting thousands of vulnerable children with financial resources to enable them to receive an education. Some churches use their own buildings and others have built classrooms to enable our children attend school. Churches are doing commendable work in the provision of mosquito nets to reduce malaria infection. Churches have trained a battalion of volunteers who visit our people who are bed ridden and infected with AIDS. We have seen many wonderful innovations from our churches which we, as politicians who want to be better leaders for our people, can learn from. Many of the activities undertaken by churches are done by willing volunteers who demand no pay.
We are therefore, deeply concerned to see that churches and NGO’s will be taxed by the PF administration, even though they make no profit from their activities. We call on the PF government to rescind its decision to remove tax exemption on churches and NGO. Not doing this will be a grave mistake that will drastically affect mostly women and children and the disabled – in other words, the most vulnerable groups in our societies.

Our Chiefs

It is time that the government backed down from its confrontation with the Chiefs of our land, particularly its standoff with the Bemba Royal Establishment. It is not and has never been the responsibility of any government, pre or post colonial, to select a chief for any area in the country. Government’s only role is to recognise the legitimacy of the traditionally established practices of an institution that pre-dated colonial rule.
This is not a fight that the government can hope to win and live in peace over. The repercussions go beyond the power play being waged by the republican president and all wise minds will do well to have their voices heard on this issue.

Our collective responsibility

Finally, let me address our collective responsibility. Whether we pretend to be unaware of the situation or not, deep down in our heart as a nation, we know we are driving too fast and on the wrong course. It is time we all rose up to tell the driver and his passengers to slow down and listen to the people.
Whether we like it or not, we have a responsibility to leave our country a better place than we found it. Let us not sit on the fence. Let us also not be like scavengers waiting to take advantage of an accident scene to pickpocket the victims and steal what we can. Let us be constructive and proactive – seeking a common solution to prevent a disaster we can all see unfolding before our very eyes.
I thank you all and may God’s grace be with Zambia.

Elias C. Chipimo, Jr
NAREP President

By Hjoe Moono

PF’s Haphazard economic management

The recent persistent negative trends in the economy as being reported by economic agents within and outside Zambia raise much concern and one cannot avoid the temptation of commenting on the responses being given by our government. We may agree that perhaps, just perhaps, the present government may be serious about resolving the daunting economic problems of the country, but is unlikely to achieve positive results because of its piecemeal and disorganised approach to economic management.

[pullquote]We are not going to get any richer by borrowing more from others in the world just so that we can buy the things they make[/pullquote]

The PF government is looking at each problem facing the country in isolation from others without completely grasping the interlinks in economic policies, and without taking into account the side effects on other areas.This is evident from the recent attempts to make the kwacha strong. It is not clear where such seemingly disjointed policies are coming from, or why there doesn’t seem to be a robust economic management team to coordinate these measures effectively. Perhaps it could be partly due to the fact that most of the economic policy advice our leader is getting is taken from nonprofessional bureaucrats, administrators and vested interest groups or individuals from either the public sector, or indeed the private sector who seem to have no grasp of, or interest in, macroeconomic linkages of the Zambian economy.

Recent blunder by BOZ

The BOZ recently announced offloading $178 million from its reserves on the market to help stabilise the kwacha. However, the kwacha seemed to have performed even worse than before. Why? They forgot the most important rule of effective monetary policy:

“Only unanticipated monetary policy will have any effect on the money market”

As long as BOZ announces its market moves, economic agents—Banks, Bureaus, Traders, etc., will form expectations and adjust their activities in anticipation of the policy, hence when effected, will be ineffective.

Let us be clear that a government that follows inconsistent policies cannot achieve consistent economic results.

There have been a lot of inconsistencies and disorganisation in economic policy which has led our economy on its current unattractive path. I will give a few examples to make the point that the individual policy solutions adopted to address a particular problem may aggravate the macro situation if policy interlinks are not fully understood and taken into account.

Addressing Railway infrastructure and loadshedding

1.The government is rightly focussed on addressing the loadshedding problem as well as the railways transport system on a priority basis but this is being done without giving due consideration to the implications of a particular solution for other problems faced by the country. The poor state of rail infrastructure and years of under-investment in the sector, coupled with increased truck haulage competition on our roads were some of the factors for below-capacity utilisation of the rail-network. The step taken to ‘improve’ infrastructure in Zambia Railways after taking it under government control with borrowed funds from the Euro Bond is indeed a joke. The amount being spent on rehabilitation with the borrowed funds is a small drop in the ocean, and it will be harder to find any value addition in wasting the Euro Bond in laying new sleepers than it will be in finding the missing MH 370 missing plane. What was required in Zambia Railways was a Public Private Partnership with a serious private investor.In which government would enter into a win-win agreement, like was done with the Gautrain Underground tube train in South Africa. A private partner would bring in the required capital at sufficient levels as well as expertise to manage the venture. This would relieve government of financing the infrastructure through debt. Just like in the power generation process, continued government borrowing from the domestic banking system and international market may or may not help reduce the periods of loadshedding but it will certainly increase the debt situation and add to inflationary-pressures.

The Path ahead due to continued domestic and foreign borrowing

On continued borrowing, both domestic and foreign, let us be true to ourselves dearly:

We are not going to get any richer by borrowing more from others in the world just so that we can buy the things they make. We have to earn our own way in the world, by making our country, Zambia, more attractive to overseas investment, better educating our workforces, and providing a climate in which our businesses are able to produce goods and services of sufficient quality that the rest of the world wants to buy them. COMESA & SADC offer a ready market for our produce, for once, let us see the value of our belonging.

Our government, the PF, has to live within its means, and not pile up deficits and debts that will burden future generations with the taxes to pay for them. We have to reduce entitlements and drive value for money through government, so we can focus public spending on areas likely to enhance our productivity such as education & health care. That said, those fired nurses must be reinstated-we cannot afford the luxury of inadequate staff in our hospitals due to deliberate policy.

If the government is serious about improving access to SMEs, more credit availability to the private sector without a sharp reduction in government borrowing would explode money supply, increase inflation and contribute to a further sharper downward slide of the exchange rate. If the exchange rate continues to depreciate because of excess liquidity in the economy reflecting excessive government borrowing, the country will get trapped in a vicious circle of more debt serving liabilities and more government borrowing. This seems to be the path ahead of us with the recent record limit to government borrowing.

Budget

In our budgetary area, to meet a large development expenditure – in addition to rising debt servicing and high infrastructure and by-election spending – the government may decide to rely much more than before on foreign and domestic borrowing. This short-sighted solution of the scarcity of revenue resources in relation to public sector expenditure requirements will push the country further into a debt trap and increase the inflationary pressures.

While there is nothing wrong with building infrastructure and even engaging in prestigious projects with sweet code names being commissioned every day, such as the ‘Mongu Stadium’—on paper, or Paul Mushindo University—under construction, these ought to be done within the budgetary constraints. Given the low tax-to-GDP ratio, such projects collide directly with more allocations for water, sanitation and health facilities for the large underprivileged population who are the majority. It is particularly annoying when the government is unable to introduce major tax reforms (e.g. windfall tax, etc.) that would bring into the tax network the vested interest groups of industrialists such as the mines. The government’s reliance on taxation using the convenience of tax collection as a criterion for taxation, and resorting to excessive borrowing will hurt domestic financial saving and at the same time aggravate the income inequalities and increase poverty.

In the absence of a macroeconomic framework that meets the test of consistency and takes into account policy inter-relationships, the pursuit of a piecemeal approach to policy formulation is likely to end up in a bigger economic mess than we are currently experiencing.

That said, the three most potent instruments of macroeconomic policy framework are fiscal, monetary and exchange rate policies. Those need to be interlinked on a consistent and professional basis and not through scattered administrative and politically motivated decisions. The macroeconomic policy framework should dictate individual economic policies rather than scattered and stand-alone economic policy decisions determining the macroeconomic outcome.

So, finally, as long as the PF government continues to look at each problem in a stand-alone manner and seeks out quick patchy fixes while avoiding structural policy reforms, the overall state of the economy is bound to continue to deteriorate even in the context of partial success in addressing some problems here and there.