TEN STEPS OF HOW PF HAS DESTROYED THE ZAMBIAN ECONOMY
1. NO PLAN (2011 – 2012 ) – Firing experts, dissolving boards and appointing cadres
They never had a plan in the first place and didn’t seem to know who was qualified for what. Sata’s first cocky action was to fire the BOZ governor without replacing him. He then appointed an ancient Minister of Finance obsessed with borrowing. These are two poor decisions that changed the trajectory of Zambia’s economy.
2. INFRASTRUCTURE OVER PRODUCTION (2012 -2013) – Neglecting the cause-effect of economics like debt today is tax tomorrow
When Sata announced the Link Zambia 8000 and Pave Zambian 2000 project, no one was courageous enough to say that even a 10 year national budget was not enough to fund 8,000 km of road network without other productive sectors suffering. The appetite for infrastructure meant, productive and social sectors suffered and generated little income for tax revenue to payoff the debts created. There was no balance between building and generating income and liquidity to sustain the economy.
3. BORROWING FOR CONSUMPTION (2013 – 2014) – Eating what we have not earned
The increment of the civil servants salaries was justified but PF failed to devise counter-measures that increased the tax base and revenue. Because as economic growth was falling, tax revenue was getting tight and eventually, we used project funds for salaries. Today we stand at 50% of national budget going towards salaries, cutting into education and health budgets.
4. KWACHA DEVALUATION (2014 – 2016) – Kwacha will soon qualify for marriage at 21
Apart from delays in appointing a BOZ governor, the replacement proved to be an under-performer. The MOF attempts to stabilize currency rates with SI33 and SI51 backfired terribly. Liquidity problems in government ensued and partly resulted in the depletion of the foreign reserves. A weak kwacha affected the cost of business, cost of machinery and cost of debt service as a result job creation stopped. Today our debt obligations have plummeted by over 300% due to kwacha depreciation.
5. INFLATION, COST OF BUSINESS AND TRADE DEFICITS (2014 – 2016) – It is global
Whatever salary increments the civil servants were awarded was stolen by inflation. Due to inflation, local products became less competitive and running businesses has become less profitable. Since 2012 Zambian has not recorded a trade surplus. Trade deficits are an indicator of falling jobs and have created a vicious circle of kwacha depreciation since forex earnings are falling as well.
6. ELECTION FOCUSED SPENDING (2014 – 2016) – Sonta epo wabomba or is it boasting nanjala
In the 2016 PF manage to “buy” votes using easy Chinese money. PF was basically boasting about spending money which the country did not generate, including building roads up to people’s door steps. The easy loans is how the Lungu administration found itself tied to the Chinese who have been getting a lion’s share of projects at RDA at the expense of local firms. Spending to appease voters is reason they think changing the face of Lusaka, changes the pockets of Lusakans.
7. CHINA-CENTRIC POLICIES (2015 – 2017) – One Zambia, two economies?
PF call China partners when in actual sense they are hijacking our assets. These are vultures who saw our brokenness and offered loans to politicians who were desperate for popularity. The reason we say RDA, ZESCO and Top Star are owned by China, is because they control these institutions by demanding tariffs and contracts. China controls them not through shareholders, but by having a say on profits and economic benefits. A chinese foreman is likely to have a meeting with President Lungu, than an ex-finance minister.
8. LEGAL CORRUPTION (2017 – 2018) – Ubomba mwibala alya mwibala
Dora Siliya coined the phrase “legal corruption”. It confirms why trucks worth US$42m where approved by ACC, ZPPA and the President, because the new legal corruption is not subjected to common sense, but to public officials colluding in the theft and saying it is legal. If corruption between 2011 and 2016 was called mere politicking until the FIC reports of 2017 and 2018 reminded everyone that it was real and widespread. People were able to connect the evidence by FIC to individuals.The reaction of the PF administration to FIC report did more harm than good to the PF administration, as they exposed their guilt. While Dr. Chilufya thinks we are suffering from hypochondriasis, it is him and PF who have chronic hypo-pompweisis.
9. ZERO ECONOMIC RECOVERY PLANS (2018 – 2019) – IMF can go to hell
The refusal by the PF to engage the IMF dates back to 2014 when they first warned Government of over borrowing and Chikwanda insisted all was well. Even at that stage Chikwanda was struggling to balance his books and was only resorting to more borrowing. The ministers that followed, Mutati, Mwanakatwe failed to stir the economy in the right course using austerity measures. This is despite the stable copper prices, low oil prices and stable SADC region. We lost this great opportunity to restore the economy due to wrong political priorities and persistent unsustainable spending.
10. BILL TEN (2019 – 2020) – Before corona virus, we had dununa virus
PF has failed to devise an economic recovery plan, because it is easier for them to steal elections using bill 10 than to offer new hope. This is a bill which basically expresses Lungu’s regret for signing the 2016 constitution with his eyes closed and he now wants to reverse all constitutional gains. Bill 10 is the seed that if planted we shall all be cursed with dictatorship, corruption and poverty. Bill 10 is a dununa virus, that PF minions are infected with and we need to quarantined.