EDITOR’s Note
This Story has been withdrawn by ZANIS
The World Bank (WB) has observed that the cost of doing business and various structural inefficiencies have affected Zambia’s economy, making it difficulty to grow above the 6 percent threshold.
World Bank Vice President for Africa, Ezwekwesili Obiageli said there are significant administrative and structural weaknesses affecting the way to do business in Zambia.
In her keynote speech at the official opening of the National indaba in Lusaka today, Ms Ezekwesili said the communications sector has remained among the most expensive in the world.
She further said the energy sector, on the other hand remains highly inefficient with the bulk of the money generated by ZESCO tilted towards supporting wages.
The World Bank Vice President for Africa also said human capital has remained underdeveloped and under-utilized.
Ms. Ezwekwesili said the agriculture sector has continued to lag behind despite its great potential to contribute significantly to the growth of the wealth of the country.
She said government has been emphasizing more on fertiliser provision and subsidies without attending to other critical aspects to support peasant farmers such as investment in infrastructure development and establishment of an open market system for the disposal of the farmers’ produce.
Ms. Ezwekwesili further said investors in this sector have had to contend with the poor inputs distribution system, high cost of production, high interest rates, unpredictable markets and pricing as well as inadequate extension service officers to support the rural farmers whose production standards are not cost efficient and competitive.
She said the sector was not sufficiently diversified to help the rural farmers can take advantage of the global demand for various products.
Ms. Ezwekwesili added that the rural electrification programme has still not met minimum benchmarks to attract large scale investments in rural areas, thereby making it difficult for business people in rural areas to adopt new technologies as part of their investments.
She said citizens with sufficient capital resources in urban areas have resisted investing in agriculture because the sector does not offer meaningful value for money.
She pointed out that even commercial farmers with the potential to maximize the economies of scale have struggled to break through, due to problems they face, ranging from sourcing inputs to accessing markets, which have remained highly inefficient and expensive.
She added that most farmers are failing to service their loans with commercial banks and advised government support the sector which she described as important to the sustained growth of the country’s economy.
She said it is now time to institute bold structural changes at micro-economic level because government has lately shown tremendous goodwill towards private sector initiatives.
ZANIS/AJN/PK/ENDS
There they go again, singing us a funeral song. But they have been advising us all the way and we ‘ve been following their advice. They ‘ve been pushing for the hike of electricity tariffs and the privatization of ZANACO which would ‘ve been issuing those loans to farmers. What do they want now?
But the government is aware of this and they choose not to do anything about…its just campaigning and bye elections all the time
Aba bena baume
This is a good piece and a true assessment of the Zambia situation I have ever read so far this year. I just wonder if RB and his team are smart enough to understand the issues raised and take action. Zambia is so poor and underdeveloped, if the govt can do a serious infrastructure development, unemployment in Zambia would drop into single digits. There is just so much to build in Zambia. Don’t these leaders travel? Look at Singapore, because of its central location in Asia, has an airport that pumps $2 billion dollars into an economy annually. Can’t Zambia learn or copy some of these things?
Madam Obiageli Ezekwesili,
please give Zambia solutions, instead of outlining its inefficiencies.This song does go on and on……
Its not structural inefficiency per se but government inefficiency
#5 Is it Sir or Madam?
true assessment. thanx ms
7-Kawalala
She is a woman. She was a powerful Nigerian finance Minister.
#7, Ba Ndume mwaligomauka, anso mwansekesha, Nshamonapo umwaume na necklace like that. Though I have seen perculiar ear rings and a dress like this on a man on ‘Jerry Springer show’ lol…
Wow I agree with you Chinondo. And funny enough they do travel but just enjoy their money. Some of us who actually have had the chance to even see the singapore airport, awe mwandi it’s spectacular but then it hits you of how bad the situation is in the country. Miss VP has actually outlined the current situation in the country. You have to make money to spend money. Goverment likes to start something and not maintain it. Look at our post office, gosh.
Guys have you noticed as i have during LPM’s reign everyone was speaking of Zambia of success, but after RB came to power its always been problems, Zambia has, just like in the Chiluba era. So could we say that development has stopped taking place without giving excuses of Global Crisis.Because during the time of LPM there was food crisis but he managed to orgainise food and he said Zambia had food in abundance. And dont give me excuses tell me what you think.Because during the seven years he was reigning it was all progress unlike Chiluba and RB. Am thinking it could be a matter of leadership.
#7, I like your humour. No offence meant on #10…
The high costs of production in Zambia is the main problem. Too many middlemen doubling the price at each turn with out adding value to the goods.
Every one has been telling GRZ to libralise the communications sector, but they continue to trivallise the privetisation of Zamtel.
All inone, it is GRZ that turns a blind eye when the common man is being fleeced by parasites. Aslong as the the parasites pay taxes, it is fine for GRZ.
Until this changes, the dream of universal development for all my pipo shall reamain but a fleeting illusssion to be pursued but never attained.
For your own information MS Ezwekwesili, is a Nigerian economist who is that country’s former finance minister that Nigerians feel was very successful in handling that portfolio. She may have some masculinity looks but that does not take away from the powerful woman that she has been. Just look at the position that she holds now..Viva!
For as long as we continue looking for solutions from outsiders, the song will go on and on. I think it’s about time zed looked amongest themselves for solutions to their problems. Don’t blame the world bank or IMF for their suggestions, they do this because they realise that we cannot think on our own. So if we want this song to end, lets find solutions to our problems and not the useless Indabas.
I hope the technocrats of various fields attending the Indaba I will be able sieve from the speeches and pick up that which is applicable to Zambia , e.g the inadequate agriculture extension officers , they played a very vital role in the past ,where are they now ? The colleges producing them should be supported, some agriculture college in monze., Mpika , NRDC, nkumbi international , chipembe college of agric ,fisheries, vet and UNZA school of agric and vet. To keep these people , give them rural incentives. decent accommodation.. employ them
Even an outsider can see. Yet those we have entrusted with driving us forward cannot see. Zesco too high wage bill like AIG yet no perfomance and the ordinary Zedian suffers instead. What VP is saying is bring this rot ( All inefficiencies tabulated) to a halt. You will see development. We are to blest by God to be poor. RB and Team Muposeko amano. And you should be listening not just dozing.
No comment on this article,but I have one question.Why is it that most of the women with higher potifolios are single?
” She further said the energy sector, on the other hand remains highly inefficient with the bulk of the money generated by ZESCO tilted towards supporting wages. ”
‘Wages’, or management? Zambia needs I think a better legal framework for both parastatals and the depolitication of the civil service.
” The World Bank Vice President for Africa also said human capital has remained underdeveloped and under-utilized. ”
I guess that is the result when the IMF tells you to reduce spending on education and healthcare, or else. Gee, maybe the IMF and the World Bank should talk to eachother? Or is this some kind of power struggle between these two institutions?
” She said the sector was not sufficiently diversified to help the rural farmers can take advantage of the global demand for various products. ”
But with food prices high and incomes low, producing for world demand should really be the last thing on their or the anyone’s minds. We need commercial scale farmers who produce food for Zambia first, the region second, and think about commercial crops last.
” She pointed out that even commercial farmers with the potential to maximize the economies of scale have struggled to break through, due to problems they face, ranging from sourcing inputs to accessing markets, which have remained highly inefficient and expensive. ”
And that is why it is so important to produce for local markets first. There is much less transportation cost…
Lets us do it ourselves, and ignore them. They shall lend us money regardless of our descisions. May God bless Zambia.
People this is not new! This is really not something that has been recently analyzed. i
This is what keeps serious investors away from Zambia. Even when you hear that some Asians are investing, just know that they organize contracts that suit them and never favorable for a long term strategy. Zambia’s inefficiency to create an environment for long term Business is for the biggest part due to the corruption within. For as long as the government does not invest in restructuring the economic frame works, the problem will still remain. Zambia has enough resources but lacks proper policies to develop the economy.
” She said it is now time to institute bold structural changes at micro-economic level because government has lately shown tremendous goodwill towards private sector initiatives. ”
I completely agree. I would like to see the following:
1) Decentralization of government
This will bring government closer to the people, potentially reduce waste and corruption if it is accompanies with greater transparancy and accountability. If accompanied by the decentralisation of budgets, it ensures money for basic services is available to all citizens, which will have the effect of taking regionalism and tribalism out of national politics, and make retaliation or favoritism for specific regions by national parties irrelevant.
2) Reinvestment of money from mining into agriculture,…
2) Reinvestment of money from mining into agriculture, infrastructure and manufacturing
This will actually lead to real development that is owned by the people, not foreign businesses doing business in Zambia and hopefully will end this obsession with attracing foreign direct investment.
3) Localisation of economic activity
The government can and should encourage only those businesses which use only local suppliers, and manufacture consumer goods within the country. The governemnt can and should lead by example, by only procuring goods made in Zambia by Zambian businesses whenever possible. Foreign investors should only be allowed to set up if there is profit sharing, they pay taxes and only use Zambian suppliers. Shares could go to local councils, or pension funds to keep money…
This woman does us Africans proud. Unfortunately she is addressing a bunch of thieves. If they spend all this money on development, there will be nothing left for them to steal! As for ZESCO, they need tariff hikes so that they can increase their salaries to European levels. Sad country.
The poster of this article must apologise. It is lifted from Kanyama’s website indeed and the journalist got the attribution wrong. WB may protest.
Matworld Nice guy! product of two Zambians.Iam so proud of my beautiful land of Zambia,and Iam proud to be identified as a Zambian.Wheather good or bad economy Zambia and ni tight like akacena(smell ) and bachelors shoes and socks they are inseparable so am I with my country. God bless Zambia.
Eyi ifi ifyanakashi fiponona abalume. Rambo bakamba
The advice she has given Zambia is not rocket science. Unfortunately the country is run by, as one blogger once said, job seekers.
#28, Ba Great Kalu.
You have cracked my ribs.. mwansekesha sana…
# Musi , sorry I have to respond to you ,only that you have made a good reminder observation. Yes as the saying goes , a prophet/ess is not honored in his/her country. If our leaders will listen from VP Abiageli though recapitulating a Zambian speech and our leaders learn from it good and well for our people.
I think HH has a point when he questions why hold indaba now, after the budget has been executed. Coz there’re numerous structural weaknesses that govt is supposed to address if Zed is to forge ahead and these areas need financial and policy inputs. Is there going to be fincial provision for some projects/policies that will be recommended out of indaba or these recommendations have to shelved for inclusion in the next budget.
# 32 The faithful one , we need solutions for Zambia , yes we are in need of solutions . Motions can be passed in parliament for amendment in the national interest. It has happened before and it will . Give solutions , to be a great leader requires thinking outside one`s shell and comfort zone. We have right now unprecedented floods everywhere in Zambia, motions can be passed in parliament for amendments…..I rest my case , will be watching from the rear mirror
One other important thing that is missing in our country is a proper railway network. trains save billions. imagine how many billions another railway line linking us to the Atlantic ocean through Angola can save us in a long run?
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LT still need to withraw the story cos it is not fair to WB.Phoenix have reported it correctly as comments by chibamba reacting to WB.check his website. WB to be fair never said much of what is attributed..
Zambia is so poor really!U can’t find good supermarkets with 3-4 floor,internet is very poor,No infrastructure,3 universities,poor hospitals,what else?it’s a shame to live in Zambia.It pains me all the time.Since those building British left us we’ve not built any modern building.These people ruling us should be removed either by force or voting another person.Because MMD will continue rigging elections so long they tell us Zambians are peaceful people.we’ve enjoyed peace since independence.In the name of peace Zambia will suffer while other countries such Angola ,Tanzania,Botswana,Namimbia moving very fast.
This report is spot on. The way to solve problems is to face the truth. Any person who refueses to face the truth doesn’t truly want their problem resolved, it’s just that simple. I don’t know how in the world we think we can create jobs without capital expenditure, there is so much building that is required in Zambia so much that the day we will start building roads, schools, hospitals, more and better 21st century houses, up to date airports, up to date telecommunication systems etc, we will find that we don’t have enough man power to build everything. We have potential to bring unemployment rate to single digit, just open your eyes. We don’t even need money from IMF and the world bank that is backward thinking and we tried it before and it didn’t work. The definition of insanity…
Sosa, sosa ichalo chilekumfwa apart from GRZ. The things she has said about ZESCO are on the ERB website in a cost of service study document. The main one is the labour cost, which is more than 50% of the income. How do you then propose a 66% tariff increase. To eat well? How do you collect revenue if 2/3 of your customers are not metered. How do u replace energy meters with prepaid meters when 2/3 of your customers are not metered? Why not start with the 2/3 ?
#38russia moscow says By the way just a correction the many people think many building that were built were by the British that not true the British in Zambia left very few building the money the made went to the building of Zimbabwe and especially Harare.Many of the building that you see in ZAmbia were built by Kaunda and his government.I thought the same like you after i read some few article but after doing some reserch on them i discover most of them were by K.K the time when not many building were built its the time of Chiluba very minimal.Even Mwanawasa tried a lot atleast then FTJ.
#41Trigo. I do not need to do research. I was there. Did u know that our mines contributed 200 millions pounds towards the contribution of Kariba Dam and yet the first power station was located in Zimbabwe? Did you know that the British left us a lot of money in foreign reserves which some say KK used to develop the country initially such as the Kafue Gorge Power Station which the World Bank refused to finance but was eventually squandered? Did u know that Chiluba inherited US$ 7 billion debt and that most of the projects that took place were therefore donor funded? One mismanaged the economy in the midst of plenty while the other one mismanaged the economy in the midst of little despite the presence of the so-called Harvard boys.
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