Zambia Needs Competent Economic Advisors.
One wonders if we really have economic advisors in this country. We have increased our borrowing to encourage investments and maintained our tax, which hasn’t had any effect on disposable income, aggregate demand and even saving.
We should have expected a fall in unemployment in the short term because there has been works going on. But I think the opposite is what has happened. In addition, there is no shortcut to helping the situation because even the exchange rate is very unstable as a result of less reserves in foreign currency to cushion the kwacha demand.
Speculations are that the kwacha will depreciate even further after elections – that’s a free hint for investors because government is fighting to control the fall in the value of the kwacha to maintain the status quo for election purposes.
Unemployment is growing constantly; business foreclosures are part of all newspapers’ daily print; standards of living are falling and one must now have K5,000 per month to survive in Lusaka.
Civil servants do not know when their salaries will be paid and even the contractors for these investment projects are being told that the government has no money to pay them for the works they have executed.
Bank interest rates have gone up and created a “crowding out effect” which entails that the government can now borrow right, left and centre.
But is borrowing helping our country? How about in the long run?
The energy sector is also in a mess, and we don’t even know what Dora Siliya is doing there.
Last year, they reported to have bought energy packages that were marooned in Mozambique, which would have added to a few megawatts of power and changed the load- shedding which apparently hasn’t. And again last week, they engaged two contractors to set up solar power plants.
Solar energy cannot beget us enough power and these are the facts; but because Dora is so arrogant, she will go ahead as long as they know that the PF punch will threaten the poor elsewhere to vote for them again.
The Chinese have given us loans and are again executing the same projects for which the money has been given. This means, apart from high interest rates gained on the money, they are making huge profits by virtue of doing shoddy works at low costs; they employ less skilled workers who are paid non-taxable salaries.