The terrible depreciation of the kwacha is due to the presence of illegal currency that has been printed and put into circulation by the ruling Patriotic Front government and is said to be entering the country through an unscrupulous businessman from Kenya.
Kenya is well know spot for money laundering activities especially from terrorist controlled regions in the Hone of Africa.
Bank of Zambia sources have told the Zambian Watchdog that the PF had access to this ‘dirty’ money which they were using to buy voters in by-elections, causing instability in opposition political parties and used to corrupt people to oppose the call for a people driven constitution.
The source said Finance minister Alexander Chikwanda’s revocation of SI 33 and SI 55 were a mere window dressing but the root cause was in the illegal notes. The source further said Chikwanda was personally against the exercise but political forces within the PF had prevailed over him.
“The PF condemned MMD for this exercise hence the rebasing of the currency and quick change of the notes soon after taking up government but they have also taken the same bad financial governance systems, this money is coming from a country where there is even a high rate of terrorism, used to finance political confusion in Zambia, corrupting people in constitution demands and also used in maize procurement then goes back in dollars. This has created a high demand for forex,” said the source.
The kwacha is still trading at over K6 per dollar even after the revocation of SI 33 and SI 55.