Lusaka based prominent economist Yusuf Dodia has described the sacking of the Bank of Zambia Governor Dr. Denny Kalyalya as shocking.
Dodia, Speaking to the Zambian business times – ZBT in an exclusive interview stated that it is shocking to the country that the Governor of the Bank of Zambia has been removed with an “immediate effect” condition.
President Edgar Lungu had on Saturday 22 August 2020 termited the contract of the Governor of the Bank of Zambia Dr. Denny Kalyalya with immediate effect. President Lungu further announced the appointment of Deputy Secretary to cabinet – finance and economic development Christopher Mvunga as the new Bank of Zambia Governor subject to ratification by the national assembly.
President Lungu further announced that Ministry of National Development planning director for development planning, Dr. Mike Masiye has been appointed as deputy secretary to the cabinet- finance and economic development taking over from Christopher Mvunga.
Yusuf Dodia stated that Dr. Kalyalya has been a focused economist, banker and a very dedicated contributor to economics in this country. He has worked at the Bank of Zambia for many years and has been through many ranks to be able to understand the operations of the central bank.
Moreover, one would have thought that Dr. Kalyalya would have been in good place to be able to resolve the challenges we have with international debt that is around US$11.2 billion dollars and Zambia’s domestic debt that is around K80 billion.
We are going through difficulties with a runaway exchange rate where we are seeing our Kwacha continuing to weaken against the US dollar, with an escalating inflation rate in our country, which is around 17%. Zambia is also engaged in negotiations with IMF to get a financing packaging for for the country.
Dodia stated that it would be prudent to have a seasoned Governor of the Bank of Zambia to insure that we get through the difficulties in a smooth and strategic way. Nonetheless, jobs are not there to be held by one person for life, Dr. Kalyalya has served in that position for almost 6 years.
The coming in of Mvunga to take over as Governor of Bank of Zambia is something which will be a big burden on his shoulder, because his taking all these challenges.
Mvunga’s background working in the ministry of finance, at cabinet office and as a Banker with Standard Chartered is quiet useful in understanding the machinery of government and it remains to be seen how the Bank of Zambia fits into this whole arrangement of banking.
Moreover, it is going to be a difficult task. Dr. Kalyalya had a difficult job and Mvunga inherits this equally difficult job. We can only wish him well.
Dodia’s advice is that there are a lot of technocrats at the Bank of Zambia. It is one institution with adequate technical expertise. In addition, good leadership means the Governor should use his human resources to the best of their abilities to ensure that they are all saving the people of Zambia in the best way possible.
It is really a team building challenge that is required at the Bank of Zambia in order to ensure that this country goes through these difficult periods with as little negative impact as possible. We begin to build a positive future in the years to come.
The sacking of Dr. Kalyalya has raised suspicion that something may have triggered it. According to sources at Bank of Zambia, he was due to complete his send three year contract in the next few months but he has been sacked even with a few months remaining.
There is more than meets the eye. It was much easier to simply let the contract run out and not renew it than to terminate his contract with immediate effect. There is definitely a trigger somewhere.
