[stop-imf] Zambia: Opposition Asks Govt to Reveal Its Deals With IMF

[rob@essential.org]

>
> Sata Asks Govt to Reveal Its Deals With IMF
> The Post (Lusaka)
> February 27, 2004
> Posted to the web February 27, 2004
>
> Webster Malido
> Lusaka
>
> PATRIOTIC Front leader Michael Sata has challenged the government to
> come out in the open and tell Zambians what agreements it has entered
> into with the IMF and the World Bank.
>
> Commenting on continued calls by government leaders that Zambians
> should sacrifice for the economy to improve, Sata yesterday observed
> that Zambia was now at a critical point more than it was in 1978 when
> the International Monetary Fund (IMF), the World Bank and other donors
> pulled out of the country.
>
>
> Sata said it was unfair for the government to ask Zambians to
> sacrifice this year without telling them what it is that it had agreed
> upon with the donor community.
>
> Sata said Dr. Kenneth Kaunda's government after the pull out of donors
> in 1978 survived then because it had a large parastatal support base,
> including the Zambia Consolidated Copper Mines, which provided the
> country with foreign exchange earnings.
>
> He said it was strange that government leaders had turned themselves
> into spokespersons for the donor community where they were even
> threatening that the country could be liquidated by multilateral
> institutions if Zambians were not ready to suffer a little more.
>
> Vice-President Nevers Mumba on Monday warned that Zambia risked being
> liquidated by the IMF and the World Bank if the nation did not submit
> to their conditions.
>
> But Sata said from 1978 to 1988, Zambia achieved more in terms of
> development without the assistance of donors than from 1992 to 2004
> with the interference of donors.
>
> Sata noted that the donor community was asking Zambia to reduce the
> civil service by 50 per cent because the government was spending too
> much on workers' pay.
>
> "If Zambia succumbs to demands of the donor community to reduce the
> civil service by 50 per cent so that we can achieve the HIPC
> completion point, who is going to enjoy the benefits from HIPC and who
> will implement whatever benefits we will get from HIPC?" he asked.
>
> Sata said PF was aware that the major donors would be meeting the
> government on March 2, 2004 and that the World Bank would be meeting
> on March 9 in Washington where "a death sentence has already been
> passed on Zambia".
>
> "All they (World Bank) are trying to do is to go on March 9 to
> Washington and pull the noose around Zambia's neck and inflict more
> suffering and more pain on the Zambian population," Sata said. "The
> World Bank meeting on March 9, even before our budget has gone
> through, is the highest level of intimidation which any country can
> expect. It makes a mockery of the announcements which the President
> and his finance minister has been making."
>
> Sata said it was not too late for the government to draw up a new
> budget which would not depend on donors but one which would be
> domestically financed because it was now clear that the donors would
> not give Zambia any money this year.
>
> He advised the government not to play in the hands of donors by
> encouraging limited dialogue.
>
> "What we need is for the government to come out in the open with all
> opposition parties, the civil society and the labour movement and
> produce a budget which will have a token of development," he said.
>
> Sata said the current consultations between government and the
> opposition were not enough while the statements on the budget from the
> government were not assuring.
>
> He said even the statements from donors were not inspiring to the
> nation.
>
> Sata said in 1992, the new MMD government which he was part of was
> given conditionalities by donors such as massive privatisation if the
> economy was to grow.
>
> He said the government privatised without proper planning and created
> massive unemployment which has become unbearable for the country.
>
> Sata said at the moment, the PF was aware that the government needed
> to pay at least US $700,000 to the World Bank before the end of March
> while a further US $120 million was needed by the IMF before June this
> year.
>
> He said PF was also aware that Zambia's internal debt stood at K7.5
> trillion from last December's K6.3 trillion.
>
> On the amounts to be paid to the IMF and World Bank, finance and
> national planning minister Peter Magande said although he did not have
> the actual figures himself, he was aware that Zambia had a huge debt
> to service on monthly basis.
>
> But Magande added: "Your numbers look familiar".
>
> Sata said with this kind of debt, there would be nothing left for
> development in the budget.
>
> He said while the government and donors were talking to farmers
> assuring them on Value Added Tax (VAT) exempt, the majority of farmers
> had already been deregistered from being exempt from VAT.
>
> Sata said this decision means that Zambia has been subjected to
> another hardship where the farming industry is being killed slowly and
> the country may at some point be forced to import food.
>
> He said this would be difficult because the country would require
> foreign exchange to import food.
>
> Sata said the current tax regime would never trigger development.
>
> "The manufacturing industry is dead in Zambia. Now Mwanawasa is
> killing our agriculture industry to the benefit of South Africa and
> Zimbabwe," Sata said. "If we pick the budget allocations like K90
> billion for finance, K77 billion for the Army headquarters, K126
> billion for the Office of the President Special Division, K60 billion
> to Parliament and several billions to the Judiciary, it makes a
> complete mockery of the required sacrifice by the civil servants."
>
> Sata said if there was any need for sacrifice, the entire country must
> do so.
>
> He said it was a mockery to make ordinary civil servants sacrifice
> whilst those in leadership are given salary increments.
>
> "This discriminatory award of salaries and allowances has created more
> corruption, and forced medical doctors to spend less time in hospitals
> but in private clinics to make ends meet," he observed.
>
> On calls by President Mwanawasa for bank interest rates to be reduced,
> Sata said the directive was not realistic because the cause of high
> interest rates was the government's internal borrowing which now
> stands at K7.5 trillion.
>
> He said most of the borrowing was meant to fund aimless and
> unproductive trips by government leaders.
>
> Sata observed that the education sector was in shambles while there
> was no policy direction.
>
> "We train our teachers at great expense, but our reward is training
> these very profile professors, lecturers and teachers for other
> countries other than Zambia," he said.
>
> Sata said it was time the nation became bold enough to prescribe its
> economic and political destiny and inform the people so that they are
> fully aware of their future.
>
> He said it was wrong for political leaders to say that the country
> could be liquidated if it did not comply with donor conditionalities
> because Zambia was a country which belonged to its citizens and not
> donors.
>
> "We would like to reach HIPC but to reach it with dignity and not
> reach it in humiliation. We would like to reach HIPC with a happy and
> well informed nation because at the moment, the nation does not know
> what is going on," he said.
>
> Sata warned that at the rate Zambia was going, its economy might
> deteriorate further.
>
> He said while the economies of Zambia's neighbours were growing,
> Zambia was being transformed into a shell.
>
> "For another 15 to 20 years if we continue at the rate we are going,
> there will be no Zambia. We shall be carrying wheelbarrows to go and
> buy bread," he said.
>
> Sata said the challenge was for the government and the donor community
> to explain to Zambians why they should continue sacrificing.
>
>