“Open Letter from Addis Ababa ‘How We Love Foreign Things!’ by Ambassador Emmanuel Mwamba”

Zambia’s three former Republican President’s; 5th President, the late Michael Chilufya Sata (Left), Second President the late Dr. Frederick Titus Jacob Chiluba (Centre) and Third President, the late Dr. Levy Patrick Mwanawasa State Counsel (Right) at Libala Grounds in Lusaka on Wednesday 5th September 2001 – Picture by Derrick Sinjela – National Mirror Multimedia Zambia Limited, owned by the Christian Council of Zambia (CCZ) and Zambia Episcopal Conference (ZEC). CCZ is now called Council of Churches in Zambia run by General Secretary Reverend Canon Emmanuel Chikoya while ZEC rebranded to Zambia Conference of Catholic Bishops (ZCCB) and is under the jurisdiction of Secretary General Father Cleophas Lungu.

President Edgar Chagwa Lungu with Ambassador Emmanuel Mwamba in South Africa

Open letter from Addis Ababa How We Love Foreign Things!

By Ambassador Emmanuel Mwamba

OUR most eminent persons in the economic sector have issued an uncharacteristic open letter and in summary said Zambia should rush back to the IMF to obtain a financial package and programme and halt any borrowings as a panacea solution to our “economic crisis”.

Former First Republican President Dr. Kenneth  David Buchizya Kaunda being presented with a book “The Depth of My Footprints – From The Hills of Namaila to the Global Stage” written by Ng’andu Peter Magande, an economist, who served as the Minister Of Finance And National Planning of the Republic of Zambia from 2003 to 2008.

So one would be persuaded to respond to this missive in a similar manner.

When you invite the gallery through an open letter, anyone can respond to the issues raised.

Flashback 2011 Former 4th Republican President Dr. Rupiah Bwezani Banda with Vice President&Justice Minister State Counsel George Kunda

So I’ve taken the privilege to respond.

Let’s start with the assertions that have gained factual foothold.

That Zambia is in a debt crisis.

Our foreign debt is $11.2 billion, and our GDP is $27.5 billion.

A simple standard calculation of the debt ratio to GDP will show that we are not in a debt crisis?

But we are in an economic recession as growth is projected to fall to 2% from 3.2%.

Even when you include our local debt of $5billion to the calculation, it still doesn’t give you a debt crisis tag, that they band around as a matter of fact!

But by now it is evident that as a people, we like giving our own country a negative narrative, we tell the worst stories about ourselves and praise anything foreign as good!

Coming to the economy, we routinely overlook and underestimate the domestic potential of our economy and our people.

Yet so far our government has demonstrated that we can run our national budget from domestic resources and service both our local and foreign debts from domestic revenue (taxes and fees).

Yet we are so obsessed with Foreign Direct Investment(FDI) and splash attractive tax and other incentives to foreign firms to the detriment of growing our own local investors.

Dr. Katele Kalumba, Ng’andu Magande, Ng’andu Peter Magande, Edith Nawakwi, Dr. Situmbeko Musokotwane, Alexander Chikwanda and Rabson Chongo

Derrick Sinjela with Ruth Machuku and Ireen Banda Mulenga at 641 New Chilenje Lusaka reading “The Depth of My Footprints From the Hills of Namaila to the Global Stage” written by Ng’andu Peter Magande, an economist, credited for making Zambia reach a debt write-off threshold – through the Highly Indebted Poor Countries (HIPC) initiative – Picture by Kasebamashila Kaseba at The Rainbow Newspaper Limited Office, in New Chilenje, Lusaka.

Zambia’s envoy to South Africa Emmanuel Mwamba-welcomes President Jacob Zuma

The culprits who crafted most of these policies are those eminent persons that took time to sign that open letter.

Despite repeated evidence to show that these incentives to foreign firms have been regularly abused and we have had minimal developmental impact or return to our economy, the incentives are deceptively encouraged as the only way to exploit and develop our own resources.

In Zambia, the mines produce about $5billion worth of minerals annually!

Mining accounts for 12% of Zambia’s GDP and 70% of our total export value.

Yet our tax returns on this huge natural resource are extremely poor because these eminent men signed treacherous mining agreements that protect the mine houses from paying any reasonable taxes.

We actually have to pay VAT Refunds in millions of dollars on items mine houses purchase.

Infact a mine house does not need to invest in the mine but merely wait for his VAT refunds and run mine operations from this source!

The mine agreements prevent mine houses from paying electricity at commercial rate, and are allowed to externalize all profits.

Their liability to the natural environment they decimate and the toxic hazards and pollution they produce, is actually token!

Bank of Zambia Governor, Dr. Denny Kalyalya and BoZ Deputy Governoer Operations, Bwalya Ng’andu with Alexander Bwalya Chikwanda and Amos Chanda

And above all, we relaxed labour laws that casualise almost the entire workforce of the industry, removing pension benefits and job security from the mine workers.

We produce $5billion worth of minerals annually, but these men tell us that we should beg for a $1.5 billion financial package?

Lets talk about 2020, the composition of the sources of the revenue measures for the 2020 Budget are: 67.9% from domestic revenue, 29.2% financing from domestic and foreign sources, and 2.9% from cooperating partners.

So these men should advise us on how to maximize return on our resources and national assets, than pointing us to a foreign source for solutions.

Zambia’s High Commissioner to South Africa Emmanuel Mwamba with Rainbow Nation President Mr Matamela Cyril Ramaphosa good as President of South Africa.

And didn’t these foreign sources make us sell and give away our entire industrial and manufacturing estate and complex? And plummet the formal employment sector to insignificant levels overnight?

Didn’t these foreign sources prescribe economic solutions and structural adjustment programmes that they are now ashamed and embarrassed to acknowledge as a failed disaster of policies that brought wide-scale poverty and widened the inequality gap in Africa?

World Bank and IFC representatives visit Zambeef’s Ten Miles butchery, with Zambeef Head of Retail and Marketing Felix Lupindula.

Isn’t this period of structural adjustment programmes in Africa now referred to as a dark period by the Bretton Woods Institutions?

I expected these eminent men to state that:

Zambia obtained a raw deal from the sale of mines – as not much income comes from these national assets.

I expected these eminent men to propose reforms to this sub-sector that would benefit the country.

I expected them to acknowledge that Zambia still has a lot of potential from its other economic sectors especially the agriculture and tourism sectors.

For instance: We need to cap profit externalization by all big and small investors.

How Zambians Love Foreign Things laments Ambassador Emmanuel Mwamba

Victor Mundende (right) is ZESCO MD

I expected them to say that:

1) Government must move quickly to operationalize the new gold mining company under ZCCM-IH and help reorganize the new gold industry.

2)I expected them to say that government should re-organize and restructure the civil service as up to 52% of domestic revenue is spent on remuneration for 200,000 civil servants.

3)I expect them to encourage government to invest in agricultural activities and increase agri-processing and formalize exports.

4) Encourage government to continue to develop its energy sector, open energy markets access, generate power and sale to any client through ZESCO transmission Lines and pay wheeling charges to ZESCO.

Tata Africa Region President Sunil Kapul, President Edgar Lungu , ZESCO MD Victor Mundende

Mbita Chitala picture by Jean Mandela -javascript: void(0)

And urge government to quickly develop the renewable energy sector.

5) Urge government to exploit the central location of Zambia as a market for products for the region.

6) Encourage the development of the tourism sector aggressively and encourage wide local participation by our business persons.

Bane let us grow our own people, let us maximize benefits from our natural resources, let us grow our economy, because some of the ‘ifikolwe fyesu’ are taking us backwards with their antiquated proposals.