‘Chinese loans to Zambia are illegal’

‘Chinese loans to Zambia are illegal’

By Prof Michelo Hansungule

The Zambian law on loans or ‘public debts’ and how they should be contracted by the executive is very clear.

This is governed by the 2016 constitution as amended. Article 65 of the constitution provides that:
(1) Parliament shall enact legislation through Bills passed by the National Assembly and assented to by the President.

(2) The National Assembly shall oversee the performance of executive functions by—
(a) ensuring equity in the distribution of national resources amongst the people of Zambia;
(b) appropriating funds for expenditure by State organs, State institutions, provincial administration, local authorities and other bodies;
(c) scrutinising public expenditure, including defence, constitutional and special expenditure;
(d) approving public debt before it is contracted; and
(e) approving international agreements and treaties before these are acceded to or ratified. (sic)
I have deliberately underlined three paragraphs hereof because they are the most important to this intervention.

Particularly the last two paragraphs, idea of providing for them in the constitution is in order to control reckless borrowing by the inexperienced politicians and members of the executive. In the past, public debt despite the word ‘public’ was a highly confidential process which was not regulated by the constitution. Only cabinet members and sometimes just the president and Minister of Finance would contract and in fact know the country’s debt and to whom the debt is owed.

Zambians remember the infamous 6 billion USD the country reportedly owed the international financial organizations during Kenneth Kaunda’s tenure and how this was used by opposition to remove Kaunda from power?

Most of the details were sketch which helped Kaunda opponents.

Back to the article above, article 65 (2)(d) plainly makes it unconstitutional and therefore illegal for the country to contract any public debt unless this first has been approved by Parliament. In terms of this law, contracting public debt by anyone including the president which has not been approved by Parliament renders that debt illegal.
It cannot be argued that these actions are served by paragraph 1 of article 65 which reads:

(1) Parliament shall enact legislation through Bills passed by the National Assembly and assented to by the President.
Some people in government have sheepishly argued based on this that unless Parliament enacts legislation contemplated in this paragraph, which up to writing this article has not, public debt may continue to be contracted in disregard of the clear prohibitory terms of article 65 (2) (d). Quite clearly, this is incorrect interpretation.
If legislation contemplated in article 65 (1) is not yet in place, this in fact means Parliament as a whole must approve any public debt before it is contracted as provided in article 65 (2)(d) failure which by the terms of the constitution, any such debt contracted is unconstitutional and illegal. It means in the absence of the law contemplated in article 65 (1) which is intended to guide the exercise of article 65 (2)(d), this latter paragraph should guide the exercise of the power to contract public debts.

Besides, the constitution is primary law which is the source of the ‘legislation’ referred to in article 65 (1) and not vice versa. Absence of paragraph 1 legislation which should have been introduced by the Ministry of Finance does not affect the mandatory application of article 65 (2)(d) on all public debts. This also is in line with part 1 on the supremacy of the constitution which provides that that the constitution is the supreme law of the land.
Consequently, all public debts which were ‘contracted’ by the government after the coming into force of the constitution are unconstitutional, null and void to the extent they lamentably fail the article 65 (2)(d) constitutional muster. It does not matter whether these debts were signed by President Lungu as State House appears to suggest. President Lungu or any other person or authority are not contemplated as ‘contracting authorities’ by the clear terms of article 65 (2) (d).
If, on the other hand, Parliament has in fact played this role, it must contradict this assertion and publish evidence to that effect. Short of this, parties to any public debts contracted after the coming into force of the 2016 constitution as amended are in illegal relationships which are not enforceable.

But this illustrates President Lungu’s character. Besides that he is clueless on governance, it is his character to get excited with money hence he signs contracts including international contracts anyhow. The mistaken belief that becomes he occupies the office of president and therefore is the sovereign does not at all cure the mandatory requirement of the express terms of the constitution. In terms of the constitution, president Lungu or any president for that matter cannot append their signature to any public debt unless only after the constitution has run its course. But because president Lungu is so easily excited with money and in any case he is clueless or has no idea how to govern, he just signs instruments to prove he is the president and in order to get as much money from those contracts. Zambians mutt wake up and defend the constitution.

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