Ailing dictator Michael Sata’s government has run out of cash and running on a serious budget over-run that salaries for May 2013 for civil servants were paid for by the Chinese government.
Highly placed sources say the budget deficit is ever increasing to a point where the new salaries for civil servants in September this year may not be effected.
“What is even worrying is that key donors have with held their budget support to this government because of serious financial mismanagement and the regime has now resorted to massive borrowing.
Since PF assumed power Zambia’s external debt is nearly double what it was 2 years ago and in 2012 alone, PF borrowed a staggering 14 times abroad adding that the country is now paying nearly $300m annually in debt repayments, and that figure is rising,” sources said.
In 2010, the MMD left the debt at 167.6 million US dollars but by 2012, preliminary data indicated that the debt was a staggering 3179.6 and it was likely to even double by end of 2013 because of massive corruption, unbudgeted projects such as PF induced by-elections, huge cabinet expensive, and travels.
“The situation is likely to worsen with the looming hunger in the nation due to poor yield as a result of bad agriculture policies. Even worse, countries like South Africa have suspended supplying food products to the sub-region option to sell to their fellow BRICS nations and Europe for more profits”, sources said.
Mineral prices have also gone down significantly hence no more government revenue making it almost impossible for the PF government to operate.
Sources said the country is not only heading into another debt trap, but is likely to stagnate in the near future because of the suspended budget support by key donors due to poor human rights record and bad governance, among other things.