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Newly appointed Zambia’s Ambassador to Ethiopia, Emmanuel Mwamba has announced that a standing business Forum between Zambia and Ethiopia will be formed. In a statement made available to the Zambian Business Times – ZBT by press secretary Inutu Mwanza, Mwamba stated that he was impressed that the Ethiopian economy was booming and driven by local people and local investors.

Mwamba said Ethiopia with a population of 105 million was the fastest growing economy in Africa in the last five years and it was imperative that private sector links between Zambia and Ethiopia were formalized.

He said he would collaborate with Chambers of Commerce in Zambia and Ethiopia to appoint a board that should drive the private sector trade and business between the two countries. He has since called for a meeting with chambers of commerce to action the formation of the Business Forum.

Mwamba further said government had shifted priority from political diplomacy to economic, business and tourism diplomacy to help fast track the economic development of the country. “We will also market tourism products to the Ethiopian tourists to sample the heritage and tourism sites in Zambia,” he said.

Mwamba who is also accredited to the African Union as Permanent Representative, said Zambia’s role at the African Union would be to champion calls that promote regional trade and integration of local Afro-economies.

He said it was unacceptable that Africa currently trades with the rest of the world up-to 88% and only trades with itself to a paltry 12%. He added that by this action Africa was inadvertantly exporting jobs, opportunities and raw materials thereby stifling prospects of implementing industrialization program and losing benefits of upwards linkages.

African countries have despite attaining political independence continued with trade and economic ties with former colonial powers who account for the largest trade volumes. You will find neighboring countries in Africa not trading through shared land borders but importing the very products available from former colonial powers who are thousands of miles away.

Non tarriff barriers as well as corrupt bureaucrats who have connived with agents of colonial interests to frustrate the provision  of  legal frameworks for the local small and medium size exporters and importers between neighboring countries is still the order of the day.

The local importing and  exporting small businesses are labeled as smugglers and treated with disdain when all that is needed is a regulatory framework to formalize small scale importing and exporting businesses who can in time grow to become large companies.

In Zambia, the belief is more skilled to attracting foreign direct investments at the expense of supporting and developing local small and medium size businesses to grow, an attitude that needs a complete mindset shift for the country to develop.

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Newly appointed Zambia's Ambassador to Ethiopia, Emmanuel

Politics

Zambia’s main opposition UPND leader Hakainde Hichilema has taken a more advisory approach to his rival, President Edgar Lungu by urging him to revert back to the Zambia plus economic program that was launched by former Finance Minister, Felix Mutati.

Concerns have been raised on the government fiscal management under the new Finance Minister, Magerate Mwanakatwe and her ability to address concerns by the market on actions the government is taking to stem liquidity and debt concerns.

Hichilema stated that “as a concerned party, the UPND would like to advise the PF Government to consider the following as practical solutions for stopping the fiscal haemorrhage and addressing the economic malaise. Hichilema stated that Lungu should consider the following:

Go back to the Zambia Plus programme and implement it in earnest. At the same time, review the implementation of the plan with the view of developing a new medium-term fiscal framework, which represents a more ambitious fiscal consolidation effort.

Hichilema advised that President Lungu and his PF Government that they should find the political will to genuinely listen to others and learn from them, particularly the intelligentsia, both within the Government and outside it. The arrogant, know-it-all attitude of the decision-makers in the PF Government is hurting the Zambian economy. Technically inept ministers in ministries like Housing and Infrastructure should not be the ones negotiating for loans from China. The PF should find the political will to stop this dysfunction.

Re-commit to the austerity measures that the Minister of Finance announced in June 2018. The PF Government should now go beyond policy pronouncement to actual execution by giving us how each of the measures will be implemented, how much savings will be realised from each of the measures and how the implementation will be monitored. This should include shutting down some of the Government departments with non-essential operations to save money for the core Government operations.

Seriously engage with the private sector to leverage their resources for economic growth. This will require important economic dialogue with the private sector. We propose an Economic Indaba with two main points of discussion, one to concentrate on fiscal policy and the other to deal with monetary policy. We propose two taskforces to be co-chaired by the Government and private sector, accordingly who will then be updating the nation on a regular basis.

Engage with the IMF and China with more seriousness and honesty, based on a firm and inclusive national consultation through the above-proposed indabas. Engaging the IMF should not be only about securing a financial bailout package but also to signal Government’s commitment to good governance, transparency and fiscal prudence as the basis on which economic actors can begin to respond to the Government policy intentions.

Re-engage Cooperating Partners, especially those that have traditionally supported social sectors – Education, Health, poverty alleviation (Social Cash transfer), Water and Sanitation, etc. – for help with resources and technical assistance to implement effective social programmes and a robust safety net, to lessen the impact of the stabilisation measures on the most vulnerable.

Rationalise infrastructure expenditure by being more rigorous and consistent with independent project appraisals, feasibility studies, environmental impact assessment and so on. These should  always be done prior to the approval of any public-funded infrastructure project, without exception.

Hichilema further stated that government should halt any further borrowing and engage creditors for possible re-profiling of the current debt.   

President Lungu and main opposition leader Hichilema have had a torrid relationship after going through bruising elections which President Lungu has won narrowly in the last two elections, about with an increasing but still low margins.

Their reported off the radar meeting away from third parties has however seemed to have opened some communications line though their support base seem to have retained their deeply held mistrust and rivalry. It remains to be seen how the 2021 elections will pan out.

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Zambia’s main opposition UPND leader Hakainde Hichilema

Companies

The National Road Fund Agency (NRFA) has disclosed that it has collected more than K50 million extra toll fees in the first quarter of 2019. The Agency says it has collected over K266 million (about US$19 million) in toll fees against a target of K261 million in the first quarter.

NRFA Chief Executive Officer Dr. Wallace Mumba says NRFA has distributed over 6,800 toll cards and collected about K21.7 million through electronic toll fees collections.

Dr. Mumba was speaking when NRFA and the Ministry of Livestock and Fisheries signed an agreement in an effort to reduce the disease burden on the livestock sector that has cost the government in excess of K30 million.

The National Road Fund Agency had in February this year been accused of losing K1 billion the claim it refuted and explained that the K1 million was purported to be missing represented the 11,348 vehicle transactions which were found to be misallocated as frequent user discounts.

The agency claimed it had earlier announced that it would be offering discounts to vehicles that frequent passes through the toll gates. The Agency has projected that it would be collecting more than K670 million in tolls every year.

The NRFA was established and is responsible for mobilisation, administration and management of all financial resources in the road sector with the key function of administering and managing the National Road Fund, a pool of funds collected from mostly fuel levy and has now been bolstered by introduction of road tolls.

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The National Road Fund Agency (NRFA) has

Sport

The Football Association of Zambia – FAZ has expressed concern over the conduct of some football clubs using unlicensed players by forging their Identity Cards and fielding them in the games.

FAZ General Secretary Adrian Kashala says players in three named football clubs had this week forged and fielded unlicensed players into the games in an effort to win which should not have been the case.

“I wish to advise that we had an unfortunate incident where unlicensed players were being fielded for league games. We have confiscated 10 forged cards from some clubs namely Real Nakonde FC and TAZARA Rangers and will continue to investigate. This type of conduct is highly disappointing and will not go unpunished. FAZ is on the ground and days are numbered for those teams in the habit of cheating,” he said.

Kashala stated that various offences have been committed both against the football rules and criminal acts such as peeling off the face of the player, fielding an ineligible player, fielding unregistered players and falsification of information.

The association has since called on clubs to closely examine Players Cards to ensure the correct image and watermarks are on the player cards. The association general secretary has also said that FAZ has received numerous complaints regarding poor officiating.

“We have also noticed with regret that complaints regarding poor officiating are not brought to the association but instead shared through social media. As FAZ we continuously evaluate the performance of referees, he said.

He added that the Referees Committee will be meet ping this weekend to deal with all the cases regarding poor officiating that have been formally presented.

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The Football Association of Zambia - FAZ

Agribusiness

The Government of Zambia has re-launched its partnership with Brazil aimed at resuming the bilateral cooperation in the field of biofuels development which had slowed down in progress since its launch in 2010.

Zambia and Brazil signed a bilateral instrument of cooperation in 2010 aiming at the developing biofuels in the country of which limited progress was seen. Brazil is one of the best examples in the world in the development and use of biofuels as a substitute to fossil fuel.

Speaking at a policy dialogue consultative forum held in Lusaka on 7th May 2019, Minister of Energy Matthew Nkuwa told the Zambian Business Times – ZBT that the failure to progress in investment of biofuel is due to some challenges the country was facing in migrating to blending of petroleum products and the necessary infrastructure needs to be developed for a successful roll out of the biofuels programme.

He said the partnership earmarks the renewable energy industry in the area of delivering the establishment of biofuel blending facilities by 2021, thereby calling for the need to grow the industry.

Nkuwa said biofuels have low emissions compared to fossil fuels hence it contributes to efforts of emissions reduction which helps in mitigating climate change adding that the importation of fossil fuels contributes to the depletion of much needed foreign exchange in the country.

In addition, he said the operation on the biofuel blending programme will lead to a reduction in foreign exchange depletion due to fuel imports as the biofuels will be produced locally.

“I wish to inform you that currently, Indeni Refinery and Tazama Pipeline Limited have no capacity to enable blending, therefore it is necessary for government to invest in additional facilities to enable national blending of biofuels with fossil fuels.

And Brazil Ambassador to Zambia Colbert Soares said the agreement around biofuels is an interesting sector of developing the rural sector in Zambia as it will contribute to the increase of jobs and to the training of labor force, add value to agricultural production chains, reduce the country’s large oil imports and improve logistics and infrastructure in Zambia.

He mentioned that Brazil is in a better position to partner with Zambia in the matter as it has about 45% of its energy and 18% of the fuel consumption originating from renewable biofuels.

Speaking at the same event, Minister of National Development Planning Alexander Chiteme also stated that energy has become a necessary resource for the operation and growth of pivotal sectors such as mining, transport and agriculture hence the need to grow and diversify the energy sector to enhance its contribution to the economy.

He said government has set an ambitious outcome of improving local energy production and that the target set in the plan requires government to increase proportion of renewable energy mix to 5%.

Zambia’s currency the Kwacha struggles with perpetual depreciation due to the country’s huge  import bill of which fuel is one of the biggest. Efforts to utilize available arable land to grow plants that can be used for biofuel generation have stalled mainly due to loss in long term focus and changes of policies by successive governments.

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The Government of Zambia has re-launched its

Markets

Zambia’s economic growth in 2019 is projected to slow down due to continued adverse weather conditions which will negatively impact on agriculture production and the energy sector, says Minister of Finance Margret Mwanakatwe.

Mwanakatwe said the slowdown in the global economy is likely to weigh down on the domestic economy. Speaking when she officiated at the quarterly performance report meeting held in Lusaka on May 10th, 2019, attended by the Zambian Business Times – ZBT, Mwanakatwe stated that the country’s economic growth in 2018 was a resilient and that the GDB grew by 3.7 percent from 3.5 in 2017.

She explained that the key drivers to this growth included mining, electricity, manufacturing and financial services sectors. Mwanakatwe further noted that the poor climate conditions affected agriculture output which brings about the importance of adopting climate resilient agriculture practices and quickening the pace of implementation of the country’s economic diversification programme.

The Minister has also indicated that the country’s budget performance on the fiscal side over the first quarter of 2019 has seen domestic revenues collection of K14.99 billion, which were above target by 4.4 percent adding that this was mainly driven by higher non-tax revenue collections from declaring of dividends.

She added that domestic financed expenditure amounted to K12.8 billion below the budget projection due to depreciation of the exchange rate in the first quarter of the year. She said most expenditure items were constrained below budget projections except for interest payments on debt which were 16.2 percent higher than the projected at 5.0 billion.

“I wish to add that the bulk of the above projected performance in domestically generated revenues, amounting to K1.4 billion were utilized on meeting the shortfalls on maturities for government paper . And in line with the fiscal consolidation drive, government intends to front fiscal consolidation over the medium term, I will be outlining measure that we must undertake subsequently,” she said.

Meanwhile, the minister said government is aware of the challenges facing the economy and that it will remain committed to addressing these challenges so as to foster inclusive growth and sustainable debt management.

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Zambia’s economic growth in 2019 is projected

Companies

The Annual Economic Review for the Zambian economy has revealed that for 2018, the total domestic revenue was at K52.8 billion, 8% above the set target of K49.1 billion.

The growth and above budget performance was mainly on account of good performance on value added Tax (VAT). Other tax types were however below projection.

However, the country recorded diminished disbursements of Grants which were below budget target by a whooping 74% at K35.4 million, partly explained by low inflows from some cooperating partners.

The report also indicates that non tax revenue collections which are mostly fees and charges levied by government institutions stood at K8.5 billion, this were above the target by 4.3% which was at K8.2 billon. The favorable performance on non-tax revenues was largely attributed to increased mineral royalty and toll fees collections. This was augmented by enhanced use of direct deposits and use of e-payment system for fees, fines and government services.

Total expenditure including amortization for 2018 stood at K79.2 billion, which was above target by 10.5%. Domestically financed expenditure amounted to K55.4 billion; foreign financed expenditure amounted to K18.3 billion while amortization was K5.5 billion.

Most of the expenditure categories were below target or within programme levels except for interest payment and non-financial assets.

The fiscal deficit on cash basis was 7.6 percent of GDP compared to 7.8 percent in 2017. The outturn was higher than the budget target of 6.1 percent of GDP. Largely on account of higher than programmed project financing.

Meanwhile, preliminary estimates indicate that real GDP growth was at 3.7 percent slightly higher than the growth of 3.5 percent recorded in 2017. The improvement was underpinned by good performance in the mining, electricity, manufacturing and information and communicational sector. Agriculture outputs was however subdued following poor rains during the 2017/2018 farming season.

The performance of non-tax revenue is one area were there is excessive government revenue leakage. Some members of the public have called for automation of fees collection in all government ministries and quasi governmental institutions to ensure that funds do not flow into individual hands of some few corrupt government employees.

Some ministries contribute almost nothing to the treasury yet members of the public are parting away with considerable amounts of monies to “push their files” for various government services. Some institutions have however put up service charters to stem the Vice but this needs a systematic approach for all the different wings of government.

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The Annual Economic Review for the Zambian

Markets

Minister of Finance Margaret Mwanakatwe confirmed that her ministry has advanced and that its on her neck planning the rebasing of the country’s Gross Domestic Product (GDP), an exercise last conducted about 10 years ago.

The minister had last year during the budget speech announced that Government will undertake an exercise to rebase the country’s GDP this year 2019, an exercise last conducted in 2012.

Mwanakatwe stated that given what is happening with the country’s economy and what has happened in the last few years, the country should be able to see the improvement and growth in the economy once the exercise of rebasing of GDP is completed.

The minister said this when she responded to a question raised by the Zambian Business Times – ZBT during the Quarterly Town Hall engagement held in Lusaka on Friday, 10 May.

The minister said that her ministry has set aside some money for the rebasing exercise but that there is need to take stock of what GDP really is. “The ministry has set aside a budget meant for the rebasing of the country’s GDP an exercise last conducted 10 years ago. But before we do that, there is need to ensure that we understand the current status of the economy before the funds can be released. The ministry will soon release the funds for the exercise which will enable the measurement of the improvement of the country’s economy,” she said.

However, a source had last week told ZBT in an exclusive Interview that no funds have so far been set aside for the rebasing exercise as announced by the minister. “The pronouncement by the minister of finance that government has set aside funds for the rebasing of the country’s GDP is just mere word on mere paper. In reality government has no money and that the government should instead approach institutions such as the African Development Bank – AfDB to assist it with the required resources for the conducing of the rebasing exercise”.

Concerns on budget credibility and the rebasing of the GDP have arisen following the fact that some projects which were announced for completion in 2019 which need more than six months to implement have still not been funded by end of first quarter 2019.

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Minister of Finance Margaret Mwanakatwe confirmed that

Politics

Former vice president for United Party for National Development – UPND Geoffrey Bwalya Mwamba popularly known for GBM has donated K80 000 to Kasama district marketeers with the aim of boosting their capital.

He told the Zambian Business Times – ZBT in an interview that he has donated K40,000 to marketers at Chambeshi market, K30,000 to Chikumanino marketeers while K10, 000 has been received by the small and medium size business community.

GMB said the donation is part of his empowerment programmes to boost capital for marketeers in the district. He has explained that marketeers play a vital role towards the growth of the economy through the taxes they pay to government.

He said most traders in the markets are women who support families hence the need to empower them with capital to help expand their businesses. He has however promised to work with the people of Kasama and has urged traders to to put the money to it’s good use.

GBM was recently suspended by the opposition UPND, an action that led to Mwamba ditching the party and later rejoining the ruling Patriotic Front – PF. He left the main opposition party on allegations of being sidelined by the leaderships of UPND.

GBM also disclosed that most of the project’s that he undertook in the UPND party where funded from his own funds. And when asked how much he spent on the projects during his time with the UPND, Mwamba refused to review the amount of money used saying the information will be disseminated on a letter date.

Meanwhile, GBM told ZBT that his move to support Kasama marketeers as a way of helping boost their capital adding that residents of Kasama have been helpful to supporting him both in business and personal life. “Am helping people of Kasama not because of politics or trying to win trust from PF, my aim is to help them enhance their businesses, and they are the people that have been supporting me in becoming the member of Parliament so I can not reject now,” he said.

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Former vice president for United Party for

Markets

Bank of Zambia – BoZ Deputy Governor says the country should seriously consider setting up a Computer Incident Response Teams (CIRTs) for various industries including the financial sector in order to curb cyber security crimes.

BOZ has since called upon the Bankers Association of Zambia to work with the central bank to ensure that this is achieved. The financial services sector is a key target by cybercrime criminals because it is the custodian of large amount of funds in the economy.

Deputy Governor – Administration, Dr. Tukiya Mabula-Kankasa was speaking during the Cyber security workshop. “I believe that the CIRT would not only assist in ensuring that all financial institutions are collaborating and working as one in mitigating cyber risks but also enable information sharing. The financial services sector has to see cyber security for what it is, a large scale operational risk deserving the utmost attention and thus develop the necessary systems and cultures throughout the sector to deal with this risk,” she said

Key to the development and operation of these systems and cultures is the need to nurture talent capable of addressing cyber security threats through prompt detection, investigation, reporting, prosecution and prevention.

She further stated that technology (ICT) has over the years permeated all aspects of our lives and in particular has become the mainstay of the world’s financial sector infrastructure. “While these ever emerging technologies such as Digital transformation, Artificial Intelligence, Internet of Things, Cloud Computing, Enterprise Mobility and Mobile Banking, have brought about efficiency and increased innovations, they have also exposed the financial services sector to cybercrime”.

”For this same reason, the financial services sector has to also deal with other types of risks, which among others include, fraud, extortion, money laundering, illicit financial flows, market manipulation, data theft, and currency attacks,” she said.

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Bank of Zambia - BoZ Deputy Governor