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Minister of Finance and National Planning Dr. Situmbeko Musokotwane says the International Monetary Fund (IMF) board is expected to meet and give Zambia a programme by the end of this month.

Dr. Musokotwane explained that once this happens, the IMF would be able to give the country a loan adding that the official creditors providing financing assurances has paved the way for Zambia to secure the $1.4 billion bailout package.

Speaking during a media briefing monitored by the Zambian Business Times-ZBT, Dr. Musokotwane said this means Zambia must prove to the creditors including the IMF and the World Bank that the country is capable of managing its affairs properly.

He noted that in the next coming months, government and the official creditors would have discussions on how to restructure the debt to which government is committed adding that similar discussions will be held with private creditors.

The Minister said creditors agreeing to restructure the country’s debt unlocks further assistance from the IMF and other multilateral agencies noting that this is important because after debt restructuring, debt will be sustainable but not comfortable and will need to be serviced therefore the need for extra financing.

“Money was given to us by IMF last year, Zambia got 1.3 billion equivalent to dollars, just a gift never to be repaid, part of which is being spent in this year’s budget but it’s not sustainable too because at some point the money will finish and you still have a mountain of debt”, he said.

Dr. Musokotwane added that borrowing money after debt restructuring is still important because the country will still need to service its debt and remain with enough money to spend on social sectors such as health and education.

He said a year or two ago, out of K1 collected in tax revenue, 90 ngwee was spent on debt service and salaries of public workers with nothing left for anything else.

The Minister mentioned that cancelling unsustainable projects financed by debt is one of the measures to address the debt situation and government has put a law in place, which says for government to acquire external debt loans, parliament must agree.

Dr. Musokotwane added that the law also states that at any given time, the country’s level of indebtedness compared to the size of the economy will not exceed a certain level adding that the law will make it difficult for anyone to get the country back into a debt crisis.

 

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Minister of Finance and National Planning Dr.

Companies

Minister of Infrastructure, Housing and Urban Development Charles Milupi says government decided to cancel the contract for the construction of the Lusaka-Ndola dual carriageway because it has no money to fund the project.

Milupi said the project would now be undertaken by the private sector under the Private Public Partnership-PPP Act, which will not cost government anything adding that it was too expensive for government to continue with the works under the previous contract.

Speaking in an interview with the Zambian Business Times-ZBT, Milupi said government took time to negotiate the concession as everything is being done with transparency and the ministry will announce the outcome of the concessions before construction works resume.

“On this particular one even if we were doing it with our own money, we would save about  USD700,000 000, that would be equivalent to the first euro bond saved on one project, that shows how expensive things were given out”, he said.

He noted that government could not disclose when exactly the project will resume, as discussions are underway.

The Lusaka-Ndola dual carriageway whose works are at 15% was on the list of cancelled loan financed projects and government has already engaged respective contractors to complete formalities for cancellation of work contracts for the dual carriageway among other listed projects.

The cancelled contract was on a loan amount of USD187,000,000.00 with the amount disbursed at USD30,000,000.00 and the undisbursed amount being cancelled at USD157,000,000.00

 

 

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Minister of Infrastructure, Housing and Urban Development

Agribusiness

The Food Reserve Agency (FRA) has announced that the crop-marketing season for this year is in progress and the agency is already on the market buying Non-Genetically Modified white maize, paddy rice and soya beans as announced earlier.

FRA Public Relations Coordinator John Chipandwe said all clients willing to sell their crops to the agency can deliver their produce to any nearest Food Reserve Agency Satellite Depot countrywide.

According to information made available to the Zambian Business Times-ZBT, Chipandwe noted that as farmers take their crops to the nearest FRA depot, the agency wishes to urge them to ensure that they clean the crops from their homesteads to prevent congestion and lessen on the time they will spend at the depot.

Chipandwe said the agency also wishes to advise farmers countrywide who will be selling their crops not to sell all their harvest or produce as the marketing season progresses as national food security begins at household level.

He added that farmers are therefore encouraged to sell only their excess produce after putting aside adequate varieties of food for domestic future use.

The Food Reserve Agency earlier announced that it would be buying a 50kg bag of maize at K180 for the 2022 crop-marketing season, which is an increment of only K30 from last year. The agency intends to purchase at least 170, 000 metric tons of maize, 1, 500 metric tons of soya beans and 1, 000 metric tons of rice.

FRA purchased 947, 777.55 metric tons of maize valued at K2.8 billion, 121.60 metric tons of soya beans valued at K1.2 million and 656.80 metric tons of rice valued at K3.2 million in the 2021 crop marketing season.

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The Food Reserve Agency (FRA) has announced

Lifestyle

Transparency International Zambia-TIZ has urged the Electoral Commission of Zambia-ECZ to ensure that the individual it appoints as the new Chief Electoral Officer-CEO has no political affiliation.

The Electoral Commission earlier announced that the Chief Electoral Officer Patrick Nshindano would leave ECZ on 7 August 2022 following a mutual agreement between both parties. Nshindano has served the commission since August 2019.

TIZ President Sampa Kalunga said different independent stakeholders should agree upon the next appointee so that even at a time when the UPND government leaves office; the individual would remain in office.

Speaking in an interview with the Zambian Business Times-ZBT, Kalunga said the appointment should be a sober one to avoid people losing confidence in the Electoral Commission therefore the need to refrain from appointing somebody because he/she sides with the ruling party.

“They should avoid appointing a person that will have to be changed with change of government. The new Chief Electoral Officer should have no political affiliations hence the appointment should go beyond praise singers”, he said.

Kalunga noted that there is need to build something that will lead the country into good systems of democracy and good governance.

“If they make a mistake and appoint somebody who is inclined only to the views of the UPND we won’t go anywhere”, he said.

 

 

 

 

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Transparency International Zambia-TIZ has urged the Electoral

Companies

The Bus and Taxi Owners Association of Zambia has appealed to government to reconsider reverting to the quarterly fuel price reviews as the monthly review is negatively affecting the business community.

Association Spokesperson Amis Daudi said the cost of fuel is a fundamental cost in the operations of the industry for both the business community and bus owners therefore the need to bring about stability by reintroducing quarterly reviews.

Speaking in an interview with the Zambian Business Times-ZBT, Daudi said it is becoming very difficult for business as well as individuals to plan and budget on their spending because of the changes being made in various sectors of the economy due to fuel price changes every month.

“Last month they increased the price, after increasing the price we had to draw a fare chat and government delayed to give the approval of that chart until the 17th. By the time we were distributing the charts, it was around 20th so the new price has only been around for 10 days and we are already talking of a new one”, he said.

Daudi noted that the association has tried to table the issue during meetings but there has not been any positive response.

The Energy Regulation Board-ERB announced a downward fuel price adjustment of K3.56 for petrol and K3.14 for diesel for the month of August 2022.

 

 

 

 

 

 

 

 

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The Bus and Taxi Owners Association of

Markets

Energy Expert Boniface Zulu says there is need for Zambia to invest heavily in new energy in order for the country to take its rightful place in the global energy market.

Zulu said the race to produce clean energy has never been greater than today as most regions, nations and private companies are putting resources together to maximize production of these systems.

According to information made available to the Zambian Business Times-ZBT, Zulu said Zambia has not seized the opportunity fully to invest in alternative energy sources seeing that energy demand is huge and far outweighs production, which is currently 3800 megawatts and is proved to only cater for 31% of the general population.

“Pre-feasibility studies to build solar factories in strategic points around the country will see move faster than lightening into a new future that has never been seen before opening doors to industrialization, electric mobility, cultural change and economic prosperity”, he said.

He explained that the main goal to build such facilities is to reduce costs on importation of solar panels that will be used to build large state-owned power plants as well as provide the public with a cheaper source of generating energy within the comfort of their homes.

Zulu mentioned that the stipulated ideas need a lot of money that can be outsourced from the International Finance Corporation (IFC), International Bank for Reconstruction and Development, the African Development Bank and the U.S government partnership power Africa.

The Expert added that the initial project studies will cost an estimated $1.8 million with the help of financial aid, it will be easy to estimate the initial amount needed to bring a project of such magnitude to life.

He noted that the tasks ahead are not easy but planning has to take place immediately as the raw materials needed for the production line of these systems are widely available in Zambia.

 

 

 

 

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Energy Expert Boniface Zulu says there is

Companies

The Citizens Economic Empowerment Commission-CEEC says it intends to recover 80% of the empowerment funds that were obtained by various individuals including artists, by the end of this year.

CEEC Public Relations Manager Michelo Mukata said the Commission has put in place plans to recover the empowerment funds from artists as well as other individuals who accessed funds under the Aquaculture Seed Fund, Skills Development and other schemes.

Speaking in an interview with the Zambian Business Times-ZBT, Mukata said the business loans that people get are meant to be paid back in order to make the empowerment sustainable so that other people can benefit adding that this will ensure the commission meets its mandate.

Mukata said the commission is currently recruiting more human resource in order to ensure continued monitoring and evaluation of the financed projects among other implementations so that all the money that is owed to the commission is recovered.

He has urged the general citizenry to make sure they practice what he called the highest level of responsibility and ensure they pay back the funds that they become accountable for when obtained.

 

 

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The Citizens Economic Empowerment Commission-CEEC says it

Markets

Economist Trevor Hambayi says the K22 billion supplementary budget that President Hakainde Hichilema requested to have added to the 2022 national budget cannot be a surplus because the country is running on a deficit.

Hambayi said the country is failing to finance its own budget as most of it is being financed by debt therefore until a time when the country is able to eliminate a portion of debt; it is not possible to have a surplus.

Speaking in an interview with the Zambian Business Times-ZBT, Hambayi argued that the country is not running to a recession but there is need to make sure that the country has a growing economy by taking recognition of what is happening around the globe.

He explained that even with exceptional financial prudence, it is unlikely that the country would have surplus funds requiring approval to spend under the current economic metrics.

Hambayi added that the K173 billion 2022 budget has a provision for the country to borrow K74.2 billion (K24.5 billion domestics and K49.7 billion external) to finance part 42.8% of the 2022 budget (with K98 billion being 56.6% from coming domestic resources). Therefore, any surplus the country will generate will only reduce the proposed budget debt financing of K74.2 billion.

The Economist mentioned that the country has not been servicing its external debt liabilities since November 2020 when it defaulted on its euro bond coupon payment. As of December 2021, the country had accrued default arrears of USD 1.2 billion and if there has been prudence in resource management, these funds should be reflecting in the country’s resrves.

President Hichilema had instructed the Minister of Finance, Dr. Situmbeko Musokotwane to request parliament to approve a supplementary budget of K22 billion arising from financial prudence. Parliament approved the supplementary budget which brought the 2022 national budget to K195 billion.

The Head of State said the extra-generated revenue would be used to increase funding towards fertiliser support programme, dismantle arrears for suppliers and contractors, payment of retirees and more road construction.

He noted that it was not debt but a surplus as the country has resources and what was missing was prudent management of resources adding that the resources have been allocated to benefit the citizens.

 

 

 

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Economist Trevor Hambayi says the K22 billion

Markets

ZANACO bank Head of Economic Research Dr. Patrick Chileshe has cautioned that a strong kwacha has both positive and negative effects on the economy, stating that exporters for instance risk facing a drop in demand and sales.

Dr. Chileshe told the Zambian Business Times – ZBT that on the positive side, the cost of imported items or products will be relatively cheaper for Zambians but on the negative side, an appreciated currency makes Zambian produced items more expensive to foreigners and that should discourage them from importing from Zambia.

“We do import quite a lot of clothing, a lot of our processed foods, what that implies is that a stronger Kwacha would imply that these goods are going to be relatively cheaper”, he said.

Dr. Chileshe however said a strong kwacha could have a negative consequence on the country’s trade balance with other countries and will have a negative effect on the performance of the manufacturing sector-export sector.

“It is also going to have a bigger impact on the agriculture sector especially the those farmers that deal in the export of exotic products such as soybean, wheat, rose flowers and other cash crops which are generally traded in the US dollar, so it will have that negative impact on [some members] the farming community”, he said.

The Kwacha has continued to gain against major convertible currencies and according to sobank’s daily indicative rates, the dollar is being sold at K16.12 and buying at K15.82 as of 3 August 2022.

Zambia National Commercial Bank-ZANACO says its projections suggest that the kwacha will end the year 2022 trading in the range of K15.60-K15.80 to the United States dollar.

The Bank’s Head of Economic Research Dr. Patrick Chileshe said it is difficult to tell the impact of macroeconomic fundamentals on a currency but given the current conditions prevailing in the market, the country will experience a stable currency.

Dr. Chileshe told ZBT that there is a risk that if the United States of America (USA) continues to tighten monetary policy, there will be a flight to safety for most international investor funds and that should have a negative impact on the favourable trend in terms of the Kwacha trading against the dollar.

When asked to comment on what is behind the current gains the Kwacha is posting, Dr. Chileshe explained that the performance of the kwacha this week is largely due to the positive sentiments associated with the creditor committee’s agreement that they will give guarantees to Zambia as well as provide further relief in terms of supporting the government to restructure its debt.

He added that this development should be able to make government access the $1.4 billion bailout package, which is a three year extended credit facility from the International Monetary Fund (IMF).

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ZANACO bank Head of Economic Research Dr. Patrick

Agribusiness

ZAMPALM General Manager David Subakanya has urged more local Zambian farmers to venture into growing of palm oil trees that are used for extraction of palm oil as there is market for the product as well as competitive prices for the produce.

Speaking in an exclusive interview with the Zambian Business Times –ZBT, ZAMPALM General Manger said over the years, Zambia has been importing the crude palm oil as there are less farmers engaging in this type of farming when there is an existing deficit.

He said this is so because what is being produced is not yet reached even half of the required threshold where you can stop importing adding that the quantities are still low. Subakanya said farmers should therefore consider taking advantage and start growing the trees to get income as well as contribute to cutting on the importation of crude palm oil.

He said Palm oil has a lot of opportunities as it’s extracted from a very productive crop, it offers a far greater yield at a lower cost of production than other vegetable oils.

The Zampalm GM further golf ZBT that what is good about this type of farming is in compliance with the environmental necessities as instead of cutting trees you plant more trees. The harvest is also on a continued basis as opposed to annual planting when compared to other Agro production processes.

Located in Kanchiya District of Muchinga Province, ZAMPALM farm has started a journey to reduce crude palm oil importation as they are producing about 3,900 litters and have the target of hitting 20, 000 liters to contribute to about 80% import substitution of the crude palm oil.

Subakanya told ZBT that the price of crude palm oil is market determined, it’s also determined by the world demand, which should encourage more farmers to venture into this kind of farming and create business opportunities and the much needed  jobs in the country.

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ZAMPALM General Manager David Subakanya has urged