INTERNATIONAL economic relations Professor Oliver Saasa has said the Kwacha is not the weakest in the region, adding that currency’s stability which the Bank of Zambia (BoZ) had achieved was more important for an economy.
He said it was incorrect for Patriotic Front (PF) leader, Michael Sata to say the Zambian Kwacha was the weakest currency in the region because there were other weaker currencies.
Prof Saasa, like Economics Association of Zambia (EAZ) president, Mwilola Imakando said the importance of a strong currency depended on its use in national development, saying export-inclined economies required weaker currencies.
Prof Saasa, who is Premier Consult managing consultant, said there were countries which had weaker currencies than the Kwacha, although that was immaterial as far as national development was concerned.
He said what was important was the currency stability which he said the BoZ had achieved.
He said contrary to Mr Sata’s view that the Kwacha was the weakest in the region and, therefore, that was bad, international economic organisations like the International Monetary Fund (IMF) and the World Bank held a view that the Zambian currency was too strong.
“It is anomalous for anyone to suggest that the Kwacha is the weakest currency in the region because it is relatively stronger and hence, good for the marketing of non-traditional export products like tobacco,” said Prof Saasa, who is former University of Zambia lecturer.
Prof Saasa said the Kwacha was faring well among other convertible currencies like the US dollar and the British pound.
He said the situation had been strengthened by the Kwacha stability which was being backed by decades-record of the biggest national reserve of about $1.7 billion.
He described a strong currency as being like a double-edged sword, saying its significance depended on what kind of the economic path the country wanted to take.
Prof Saasa gave an example of countries like neighbouring Malawi whose Kwacha had higher value than Zambia’s but the economic levels were not so high.
In a separate interview, Dr Imakando expressed similar sentiments, saying export-oriented economies would benefit more from a weaker national currency because the products would be more competitive as opposed to those with overvalued currencies.
Dr Imakando said abnormally strong Kwacha would render the local products uncompetitive on the international market because the prices would be unaffordable.
He, however, said when the country wanted to embark on major capital projects, which required importation of machinery and other things, a stronger currency would be more desirable.
Dr Imakando cited Japan and China whose respective currencies are lower compared to other major convertible currencies and yet they have giant economies, saying that went to show that the strength of the currency was immaterial.
Mr. Oliver Saasa what’s your point? Give us the list of currency within the region in order of their strength
instead of beating about the bush. To me you just sound like none other than a Sata hater.
Naimwe ba Dr Imakando, Japan can have a large economy but that is not because of the strong yen. The country is hurting now because of that. Atase, wenye wanu.
The voice of the intelligentia cometh forth with indepth analysis not all have the priviledge to decode…thx prof for the insight. But my only concern is the stability of the kwacha is most often influenced by our 70% export earning material (copper) LME price fluctuations! theres urgent need to ofset the mantle on copper, diversification is inevitable in zambia at the moment…i am glad the currency has stayed in the 4600 to 4800 band for a quite some time now. compliments of the season LT.
am not a professor nor a doctor but this analysis is crap gentlemen. Correct the strength of the currency was immaterial but when you carry your kwacha’s to any country in the region what value does it have. People need money in there pockets and it should have value as the value of developmental and economic levels is only in your sight and not to a Zambian in Mongu or Shanj’ombo. You do these analysis to your benefits and not for the people. The strength of the currency is what adds value to people and not the high level of economies and/or developments. Work up ba Professor and the Doctor. Stop impressing the government.
The kwacha is doing fine
Professor Oliver Saasa, don’t waste your energy lecturing Sata materials that are technically beyond his comprehension.His life evolves around insults period.If you have never head him end his fear of mentioning GDP, don’t expect him to grasp complicated matters of international finance, interest rate, xchange value, basis point,NPV, FV, ICC,Ratio of intangibles assets to total assets, Risk-Return Trade-offs or indeed SD in National earnings.
Any economist will agree that the strength of the currency was immaterial. However, I note with interest Imakando’s observation that a weaker currency is good for export oriented economies like China and Japan. It is also true to say that a weak currency can be catastrophic for an import oriented economy like ours because just to purchase capital machinery, you will have to incur monstrous costs and this can be a huge hurdle to grow the economy – catch 22. That’s whay buying unecessariry expensive cars like that Mercedes Benz for Banda amounts to unforgivable s.t.u.p.i.d.i.t.y.
Its like this story has been twisted I listened to Oliver Saasa and this story is a bit contrary to what he said unless I did not get it clear.
Prof Saasa is being economical on the truth. We all know what you did when you were a lecturer at UNZA, how those projects ended up in your hands and how your private consultation firm sprouted. Malawi has had a stroger Kwacha than Zambia for a long time now and we all know that its easier and cheaper to buy things in Malawi than in Zambia. under Dr Bingu Wamutharika, Malawi’s economy has soared to its best and while Zambia’s economy is ticking on paper, in Malawi its ticking in reality. so tell us something else, look at swaziland maybe not close neighbors in the southern african domain. mind you though we have DRC wemust know that they have been fighting and so we cannot compare our tattered economy with theirs. the same applies to angola. zim its a matter of time and they will be tops
China and Japan are not in our region. Being a prof is not everything, he is a specialist in one lesson! May be he is referring to the old Zim dollar.
Such a professor cannot be my advisor, he is useless, too much theory like Aka but no substance.
If he is a genuine prof in economist, why is he poor! HH is one of the proper economist because he practised what he learnt with his MA.
These matters are beyond Sata’s comprehension. He has promised to perform economic miracles within 90 days of, God forbid, assuming presidential office. The man just says whatever comes to his mind as a populist demagogue with little or no grounding in economics or international trade and finance. He is a talking disaster.
A strong currency is one which can buy you variable things at less expense.Our kwacha cant.Proffesor what you are saying ni malabish
A strong currency is one which can buy you variable things at less expense.Our kwacha cant.Proffesor what you are saying ni malabishi
#5 Those were my thoughts as well. No one in PF can understand the issues raised in this article. It is beyond them. Even their supporters on this blog. Trust before the day is out you will see the many insults and ad hominems they are going to spew. That is all they know. This issue is well beyond them to debate decently. And please get used to the FACT that Sata will never rule Zambia. We don’t want dull characters and on top of that without wisdom to be in charge of state house. They will take us back 120 years.
The unfortunate thing here is no matter what veteran and his MMD say, they are going almost next year and thats the best gift any Zambian can be given. Right now, anything is better than MMD. So whether sata is right about the useless kwacha or not, the PACT is giving MMD a big boot and thats what matters. Enough of MMD filth.
How wrong iz Sata? This iz roughly how the kwacha farez against regional currenciez; 1. Angola= K52, 2. Botwana= K699, 3. DRC= K5, 4. Malawi= K33, 5. Mozambique= K152, 6. Namibia=K614, 7. Tanzania= K4 and 8. Zimbabwe= K13. Who iz fooling who?
#13 & 14 typical PF mentality ..this topic is just too heavy for you. Come on my friend this is basic economics. For a country to develop it needs to export more and import less in terms of value. A higher valued currency is not profitable for exporters who create jobs and wealth in the country. A lower valued currency though bad for importers is actually good for exporters because they get more money for their goods and this is the real more money in the pockets fo Zambians. Also note that it is manufacturing that creates real jobs and manufacturing is supported if exports generate more revenue. In this SA for example people are not comfortable when the Rands starts strengthening because they heavily rely on exports.
Stability is more important and Kwacha is.
#17 The Only Living JAY, Oh my God, what a dull way to compare the currencies? Where did you learn that. Certainly not from UNZA. You need to go to Comesa market and get some education from Cross Border traders. If you were border trading you would go bankrupt in days. They got they education from the school of hard knocks and it seems they would beat you at this game. Currency strength is about value of goods you can get out of it. What you can buy in that currency if all conditions where equal. Its not about figures my idea. There is a big difference between price and value.
Good point #18 chief bootlicker
“Prof Saasa said the Kwacha was faring well among other convertible currencies like the US dollar and the British pound.”
Q: Is the Zambian Kwacha a CONVERTIBLE currency? Is it AMONG them?
“He said the situation had been strengthened by the Kwacha stability which was being backed by decades-record of the biggest national reserve of about $1.7 billion.”
Q: Wasn’t this backed by a direct loan to Zambia to boost its reserves? And not by anything kamwendo Munjila has done?
This is shallow reasoning by the Saasa and am quite disappointed. What we say in the pact is that results must be seen. MMD presidents are so out of touch they talk such language in the villages!
#15 MMD Bootlicker I dont what the crap you are talking about. If the Kwacha is doing so fine why is there so much poverty in the country. The situation in Zambia is only a few people are enjoying and living well the rest are wallowing in poverty and you are proud to say what you are saying. You should find time to go round Zambia and see things for yourself. MMD whether you like it on not has failed to run the country.
These poverty stricken professors, too much theory! I remember this prof when he was campaigning to be UNZA vice chancellor with Prof. Serpell. He again used such cheap theories, and he failed to win the debate, the guy lost! I can only listen to real economist who have used their brains to become rich eg HH!
Assistant MMD Chief Boot Licker @ 4. What makes currency strong? Is comparing the Kwacha to the USD enough? Let me tell you since the Kwacha appreciated against the USD the prices of all commodities have risen by 1.5 times eg mealie meal has shot from K45,000 to K60,000. Dstv has gone K340,000 per month to 370,000 per month. You are talking that way because you are far off. Me like Sata I will measure the STRENGTH OF THE KWACHA BY THE AMMOUNT IT WILL BY ME NOT BY FIGMENT OF IMAGINATION OF SOME PROF AND BOZ. Sata has seen that the Tanzanian Shilling is buying more commodities compared to the Kwacha. To me that is makes more sense.
This may be a dull way to compare the currenciez, but it still remainz a fact, unless it can be proved otherwize. Obviously when other economic factors come into play, the situatation may be differnt here and there. There iz the realistic situation and what iz obtaining on the ground.
# 18 great analysis but that is a school of thought that is not working out. This country has too many intelligent economist but look at how poor we are. IMF and World bank filled with theorists just like Zambian economists. What we need is to stop people externalising funds and ensure money from copper sales sits in Zambia. In the vent that we cant do that windfall tax should set in. Then we shall have money circulating in the country, banks will lower interest rates, and the manufacturing companies can afford to buy equipment. The country needs people with balls to make hard decisions.
Comparing the Zambian currency against the Malawian currency (e.g 1ZMK compared to 1MK) does not give an accurate picture of the strength of the currency. There are many things to consider, is the Malawian kwacha widely accepted in Zambia and vice-versa. This is why most trade (not all) is done with reserve currencies like the USD, EURO or Japanese Yen because these are widely accepted currencies all over the world.
Currency also depends on the amount of confidence people have in it. This is why there are many concerns with “dollarization” in the economy. If people do not have confidence in the ZMK, they will not accept it as a means to conduct business and will opt for a more widely accepted currency like the USD, EURO or Yen. [tbc
cont from #27
If people are not confident in the currency, they will dump it by buying more widely accepted currencies like the USD. This will cause the ZMK to fall in value. Concerns about the currency can also possibly cause inflation as there will be too much money flowing in the economy due to currency dumping. This is where the “immaterial” issue comes into play. Depending on the type of business (importing business/exporting business) you run, you will look at the strength of the currency but the main thing that is mostly looked at is stability in the currency. The currency must be stable in order to reduce on the cost of doing business. [tbc
You economists, the people of Zambia want a plate of nshima and a plate of kapenta on the table twice a day. and a plate of porridge with groundnuts and brown sugar in it everyday for the kids. You may fortify it with vitamin A if you want. Children can go to school after that and parents can go to work in the fields as long as when they meet in the evening, it is over a big meal enough for all. They have big land and are only twelve million. Whats the matter?
cont from #28
We must also look at our major trading partners when looking at currency in the international markets. Zambia does a lot of trading with South Africa in the region which is why at many Bureau of exchanges, you’ll find the South African rand listed together with the USD, EURO, British Pound and most likely Botswana Pula.
My point being, it does not matter how many zero’s you have on your notes, what matters most is the confidence people have in the currency. Confidence is strengthened with a stable currency.
Good night/day everybody and happy blogging.
I dont understand what the prof is trying to get at realy
zambians we talk too much and do less.. I call a spade a spade, it just is what it is.the kwacha is very weak and someone saying bla bla must be fired..we must do something 1$=5000 sure look at namibia botswana ..sometimes i send $ to my family at the bank they laugh at me eg i send $150 in kwacha it will be half a million then some one is saying the kwacha is ok..please give me a break
WISHING ALL LT BLOGGERS AND THE LT CREW A HAPPY XMAS AND A PROSPEROUS NEW YEAR…….CHEEERS!!!!
The professor is just part of the new MMD propanda strategy. He obviously has been some brown envelope to spread false material. Ni nkani yakongono che.
# 33 thanks but xmass in russia is not real tommorow i have an exam..imagin that shit.everyone is in xmass mood but am in an exam mood..triky
Thanks to the 2 educated men. Sorry ba PF leader is grade 7 so cant understand. Ba Sata tabanwa ink
From the articles and the opinions of the professors it seems that Sata was not wrong at all. What he stated was that the Kwacha was the weakest economy in the region (even if you want to get technical and consider Zim cause the Zim dollor is no longer in use). By the learned economists own admission, a strong currency is a double edged sword depending on whether a country is a net importer or net exporter. So what would be more informative coming from a professor of economics is to inform us which of the two situations is beneficial to Zambia. Is it more important for us to have a weak currency so that our exports can be more competitive, or do we have need a strong kwacha so that we ca import capital goods more cost effectively. The professors analysis disappointingly lacked on this.
# 18 MMD Chief,
This is has been the premise of my unwavering fear of rewarding patent illiteracy. Do you see the clear and present danger of protruding ignorance which is anchored on illiteracy Sata personifies in this age? It’s unfortunate that all PF kaponya lack the very basics of economics, rationality and development gist. MMD is ambitiously moving the country towards an export driven economy from the manufacturing base which the current steadfast investment flow will create.
All of you have a merry Christmas and a happy new year except you know who.
#22 ISAKA, to quote you “ If the Kwacha is doing so fine why is there so much poverty in the country.” that is a very myopic statement in this time and age. You might as well answer the question. If Europe, US and Japan are developed countries, you do you still have poor people, homeless families and street kids?
#26 to keep money in the country we need a strong manufacturing base and RB and the MMD government have realised this and that is why there is a push to building these economic Zones you have been hearing about. I can tell you 2010 you will see more action on the ground, and tangible development. We all know in MMD that our 2011 re-election depends on the practical manifestation of development on the ground in 2010.
How do you diversify and build an export driven economy with Sata’s flawed logic? Here are historic economic zones just about to mushroom around the country a good thing for all as they will expand the business horizon. Economists are in-charge; just expect more investments as we move towards industrializing the economy. Technology, skills and capital transfer will flow in which will enhance efficiency, reduce production cost, product quality and deliver a competitive edge in SADC if we can put our act together. This is a match towards real and sustainable economic empowerment than the 90 days Utopia of more money in the pocket of every cadre that can insult.
#continued from 40 If we can convince Lusaka and copper belt province with our massive projects in these regions that add real value to lives of the people and create well paying jobs, Southen Province and Northen/Luapula will be irrelevant. Western and North Western we are 50-50 there. Eastern and Central is already in the bag. Trust me 2010 is a new dawn for MMD in terms of service delivery ..watch the space. We need to for us to secure a landslide in 2011
Good morning Zambia
Well, I don know much about this professor Saasa but his reasoning really leaves one questioning the authenticity of his credentials.
1. Everyone knows that international financial organisations like IMF and the World Bank are instruments of oppression for the Third World countries so how can he side with them in holding the view that the Zambian currency was too strong???
2. Why does he fail to name the other currencies in the region which are weaker than the Kwacha?
3. He cites that Japan’s and China’s “giant economies” are due to their weaker currencies but I think he is maistaken. How does he explain the strength of the European economy even though the Euro and the pound are currently the strongest currencies worldwide
Big up to Mr Capitalist, The bootlicker and a few others. Most bloggers dont seem to see a difference between the economy and politics. Some guy asked me how i feel about the zambian economy and i told him GDP has grown by 6% and we have had the highest reserves in 4 decades.Our rating on the easy of doing bussiness has also gone up. guess what he said ” awe MMD is loosing the 2011 elections, RB taishiba ukuteke ichalo!!” and i said to my self ” this chap asked me about the economy expecting politics” people must realise that its not about which party you belong to, if its $1.7 billion it will still be, if its 65 it will still be. Figures dont lie!! I have noticed that even the Post doesnt talk about the economy in their editorial or headlines because they know what time it is!!
# 39 JUST SAY WHO
#22 ISAKA, “ If the Kwacha is doing so fine why is there so much poverty in the country.”
# 40 # 18 MMD Chief,
Maybe its time to start lecturing some basic economics than debating in evidence of knowledge imbalance between MMD and PF surrogates here. I see the need for debates on Welfare economics, unemployment, stability, development and the The Malthusian Trap theories. PF Kaponyas we are here for you.Just share your challenges.
Currency exchange rates do not play out in a vacuum, they do so in a context and that context is their economies. If what some economics quacks critisizing Saasa here are saying was true, then why did the United States of America incur a trade deficit equal to US $2 trillion with China in 2008 when every US$ 1 during the year could buy Chinese RMB 6.80? Further, can these people also explain why during the same year the US economy grew by a megre 2% (real growth rate) while the Chinese economy surged by 9% in real terms? Exchange rates are not all there is to the strength of the economy, there are many other factors so please if you do not know, just listen so that you can learn.
PF kaponyas are indeed a rare breed. They side with everything that cantankerous leader of theirs says and they lack a basic understanding of real issues. Where are you going to get money to give to people so that they have more money in the pockets within 90 days of coming to power? (God forbid!). Dream on and while you are dreaming others are performing.
Its laughable really for some people on this blog to be singing about how ‘strong’ the Malawian currency is. Honestly this is rubbish. Please compare the GDPs of the countries in the region and you will understand as to who are the economic giants in the region. According to GDP figures of 2008 the top four are South Africa, Angola, Zambia and Botswana in that order. The exchange rate is and has never been an indicator of economic strength. If this were the case little Malawi with a GDP of $3.9bn is a far better economy than Japan and South Korea because you get more dollars from Malawian K1000 than you will get from Japanese Y1000 or South Korean Wong1000. Sata and his supporters should just go back to school ratherthan continue to embarass yourselves. Economics is beyond your…
What do expect from a grade seven dropout like Satana?he knows nothing apart from distorting facts .God forbid that this never rules Zambia in future .May you deal with him as his sins deserve ,he’s crap nambala one.What a shame .
Very interesting arguments between the PF camp and the MMD or pro MMD camp on this blog. As an observer I think the PF camp has lost the argument. They dont seem to be knowledgeable enough on this subject.
The strength of the kwacha is indeed a 2 edged sword. Zambia desperately needs to be export oriented, therefore we need a weaker ZMK. Our local market is not big enough, population is small and not as rich. Yes importing capital goods is more expensive but if most of the production thereof is exported, that will be compesated. ZMK strength is linked to our exports, mainly copper at the moment. China & Japan are examples of export oriented economies and have got richer as a result.
Mr Saasa, in the place try to compare the Zambian currency with other international on the markert. if is doing on the international market why people in Zambia. for instance K6802.70 is equal to €1. And there are people who getting about €100 which is K6,80010.45 of which they are failing to support there families for a month. Now if the Zambian Kwache is doing well on the Inthernational level why is the value of it is so poor. Please be clear when touch such issues.
shyt up all you MMD puppets!!!! kwacha is a shambles currency. economists.. my ass.
#51
UK-Zed Observer: PF have lost the argument? Depends in what context Mr Sata meant by the weakness of the Kwacha. Like Imentioned earlier things including food have really become very expensive. In short, we anti MMD are not interested in your academic explanations even if the Kwacha trades at 1 to 1 against the Dollar. This really means nothing. Tell my mother in Luapula that the Kwacha has gained strength while Bunga has jumped from K45k to K60k if she will know what to make of you.
Prof Saasa what our economy need is to start a delibarate manufacturing base to substitute some of the unecessary imports which directly contribute to the high inflation inthe country.Why for example can’t we make breakfast cereals in our country like cornflake?Car parts can be made in Zambia as well and that will even further improve reserves .We do not need empty politician like Sata to comment on subjects they least understand.This man is liability to the safety and prosperity of Zambia.He belongs to the recycling bin-finish.Merry Christmas to progressive Zambians both at home and abroad.
#53Mr So called Tembo you failure to hell with your little knowledge.Go and educate your Satana on Satanomics of kaponyas who make make money everyday yet are poorer than a civil servants who earn peanuts because they give all their money to Given Lubinda’s beer businesses and the chap is rich.
An economy based on paper work and projections is no economy at all. Translate the economy on how much the poorest of the poor can afford to buy with the little they manage to save. Can they buy bread and sugar and survive a week. If the Kwacha can not afford unless a cent. Then our money is weak and useless in the region. Zim dollar will pick and we will remain static defending our currency on use.less …
#52 thats a terrible comparison you are making .The cost of living in Zambia where you in europe is very different.For 100 Euros you can’t rent a decent flat but that same money you can rent a relatively good house in Lusaka or Solwezi.The problem with you chaps in UK and alike is that you keep on comparing zambia to those imperialist countries.Why do’nt you compare Zambia say with Nigeria which is a resource country like zambia or Zimbabwe the former darling of the west or indeed Tanzania,Kenya ,Uganda which is moving forward much better than zambia because they talk less and their politicians and educated not like our grade two Sata.
Huh!!! What are u guys debating?Really,sometimes I find you bloggers very funny.I don’t know if it’s LT to blame for bringing up this topic or what’s to blame?I mean,in all fairness of life,how on earth would one ever even contemplate debating the differences in the economic/currency analysis of Mr Sata,on one hand, and Prof Oliver Saasa & Dr Imakando on the other hand?Just HOW??? I can understand if it was HH in place of Sata but not Sata himself.LT please don’t start confusing people,bring topics worth debating!
Just yesterday the PF UPND pact was critising the zambian delegation sent to the climate meeting in Demark.One would have expected that at least HH should understand that the carbon emissions market is fast becoming a major cost driver for businesses and the carbon market will be worth £1 trillion by 2012. The MMD government needs to now create a local downstream industry for Zambian’s raw materials like copper and in the near future crude oil. We can’t continue exporting raw materials as we have done in the last 45 years. Botswana mines the diamonds, processes them locally and then exports them.
I see that prof Saasa’s explanation and analysis is beyond the comprehension of many of you and Sata. National and international economics are governed by trade and export dynamics which in turn stretches the power of the currency. These are based on the country’s capacity to produce good, both finished and unfinished. I know what Sata wants to say next,” If i become president, the Kwacha will be strong” No, i doesnt work that way Mr. Sata. And yes, the Kwach is not the worst.
DEPUTY Minister of Justice Todd Chilembo has clarified that Vice-President George Kunda travelled to London for a case Government had with Donegal International and not for the plunder cases involving former President Chiluba.
Elo yawama bola bane.
#60 which Bostwana are you talking about?Sooner than later Zambia will be far much better off than Bots coz we farm and do not import cabbages.
Ladies and gentlemen go do your christmas shopping this Sata is going confuse even the most learned person with his assumptions.He’s a comedian ,how come he’s the only one who speaks on everything and on anything concerning the country where are others from his party/
I have noted with interest that now almost all the stories on Lusaka Times are coming from the Times of Zambia.Is the Lusaka Times a subsidiary of the Times of Zambia? Fill me in on this one gentlemen and ladies.
#65 No, but that it is a reliable source if you want the post go their website it’s free for now.Thank you.
#54 De Javu
I did read your #24. I do not know why DsTV and mealie meal prices have gone up despite kwacha strengthening against the USD. May be forex is not the only ingredient. Try to find out from Multi Choice and from millers.
You may be interested to know that in Zambia, mealie meal prices are cyclical and they go up every rainy season. Largely due to scarcity of maize, road conditions worsen due to rains, etc. Mealie meal prices will come down at harvest.
My mother is also in Luapula and I had DStv in Lusaka so I am familiar with your concerns.
Zambia has very useless educated people no wonder the country is still backward,too many theorists like Aka and this mad professor at play.The wealth of Zambia is only good on paper.The kwacha is a very useless currency as it buys peanuts.All you supporters of this Saasa professor are just like every other Zambian that glorifies illusion.The reality is the Zambian economy is weak despite having an improving GDP as all the cash is flown out of the country by foreign infestors and all you dull clowns remain with is a peice of paper telling you how well the economy perfomed.Zambia’s economic story can only be compared to the “Emperor’s new clothes” where he thinks he is dressed but is actually naked.All the cash leaves Zambia,wake up you daft mongrels!!
He is indeed he is a ‘unique Zambian politician of rare breed’ like his mouth pieces at the tabloid.
Indeed he is a ‘unique Zambian politician of rare breed’ like his mouth pieces at the tabloid.
Unfortunately, expecting Mr Sata to understand macro economics would be expecting far too much for his interlect. I always get amused when I find relatively well educated collegues lamenting how weak our currency is compared to say, that of Malawi.
For starters, Zambia is a poor Country and poverty will not be eradicated by simply moving about the zeroes in a currency. Zimbabwe tried several times and you all know it never worked. It is not the number of zeroes that matter, it is the stability. The Kwacha has been hovering between K4000 and K5000 to $1 for the last seven years or so. It sometimes moves up and sometimes down. Its therefore not correct to say its very weak just by the zeroes our notes carry, because if that was true, Japan, the world’s 2nd biggest economy would be poor.
Bloggers dont argue and blog from afar about zambian kwacha, some of you dont even remember last time you had Zkwacha’s in your pockets, because you have been spoiled spending in US dollars,Euro,Pounds etc and you dont even know how much a single meal cost on the streets of Lusaka. Ask a common man on the streets of zambia, will tell you the practical situation of a Kwacha VS other currencies, other than this explanatory theories by this professor Saasa
Secondly how honestly a professor would think China and Japan are in the same region with Zambia?
#68 YesZambia has very useless educated people no wonder the country is still backward,like yourself who sweeps the streets of London.Make yourself warm man.
#73 Ask yourself why do Zambians talk always in dollar terms?Go ask South Africans they do know even the current exchange rate.You want to peg even nshima in dollar ,for what ?Think kwacha it is stable enough period.Good night and merry X-Mas.
Mr/Ms YAYA, we use Dollars not because of the weakness of our currency but because it is more convertible and has more international recognition. Our economy is too small to have a rimple on the world stage, if I may ask you, you know that Botswana is quite rich by third worl standards, and it is our close neighbour, how often have you used the Pula?? It is rather size that matter
#5 Veteran and # 18 MMD Thief Bootlicker,your reason should be of very low Standard because Please before debating on tha Blog,Research by defining the Subject matter Like this
1.Kwacha is a Currency.hence the defination of a Currency is; Money in any form when in actual use as a medium of Exchange.
2.You now look out for Currencies for the region and make a Comparison with our Kwacha, I believe our brothers @ #17
3.Now Go back lokk into whose statement has Substances and the truth betwen the Professor’s and that one for Ba Kateka. So Brothren do be so Arrogant.
Atleast i have taught you how to approach and debate issues not the excuse you give everyday that your lecturer was always in and out of the Hospital when you were suppose to be learning.
Some of these professors and doctors of this and that should remember that the majority of Zambians do not understand all about the Kwacha appreciating or depreciating and what matters to them is value for their money. They are not interested in your academic achievements and all that stuff. What can a kwacha buy for a poor villager who has no access to the US$ or the £? Why should Malawi be better off than Zambia? And some of the bloggers will support the governments incompetence and mismanagement just because they are beneficiaries of the plunder and the rampat corruption. These same bloggers will not comment on the ghost teacher issue and the use of 3 aircraft on one trip to WP and ..etc..etc
#5 Veteran and # 18 MMD Thief Bootlicker,your reason should be of very low Standard because Please before debating on tha Blog,Research by defining the Subject matter Like this
1.Kwacha is a Currency.hence the defination of a Currency is; Money in any form when in actual use as a medium of Exchange.
2.You now look out for Currencies for the region and make a Comparison with our Kwacha, I believe our brothers @ #17 has helped us with the rates.
3.Now go back look into whose statement has Substances and the truth betwen the Professor’s and that one for Ba Kateka. So Brothren do be so Arrogant.
Atleast i have taught you how to approach and debate issues not the excuse you give everyday that your lecturer was always in and out of the Hospital when you were suppose to be learning.
From the many brains that have spoken i get the feeling that the Govt is keeping the Kwacha at these levels( weak so Sata is rite after all) to encourage the manufactrers and examples of China and Japan are being given as examples of countries following similar startegies.
This is strange coz zambia has no maufacturing industry to speak and our major exports are as follows :
copper/cobelt 64% and the rest are electricity, tobacco,flowers and cotton.
So were are we getting this keeping the exchange rate so high in order to encourage the manufacteruring industries.
Going by the analysis by pro Sata bloggers; we can now officially declare that the 14th biggest economy in the world i.e South Korea is poorer than the 52 African countries serve for Zambia. This conclusion has been reached on the basis that $1 is equivalent to 2200 South Korean Wong. This exchange rate is far worse than those of the 52 of the 53 ountries in Africa apart from Zambia were you get $1 for K4600. Lol.
lets not waste time on proff saasa. reality shows that zambia experienced the the biggest industrial growth ever seen when the kwacha was 1 to 1 with the pound. during the mwanawasa regime when the kwacha appreciated against the the dollar in the tune of k2000 or so people imported cars that you now see on the roads thereby adding value to the average zambian.cooper although not as essential as oil will always sell and zambians have to benefit from this god given resource by way of a strong currency. finnaly dont compare malawi to zambia they dont earn export revenue like us, besides zambians have always enjoyed a better standard of live even with economic problems than them.
Practicaly sata is right and equaly theorecticaly wrong and the other way around
Strong currency means cheaper fuel and good running economy. Let be practical. Exports does not benefit Zambians as the Copper is no longer ours but Chinese and Indians and the only way Zambians will benefit is through a strong Currency as the ****ts we are geting will buy something practicaly
If food and energy is affordable to everybody earning a living then our currency is better off but if it is the otherway round the the so called capitalist economists must go back to the drawing table bearing in mind that capitalism has failed. It has no heart for the poor of the poorest. we want share what belongs to us and not letting these so called infectors to milk our country in the name of building our economy. What happens when we reach there you think they will let us. In case you are not aware China has a 100yrs plan for Zambia. Where will most of you be yet zambia has only 30yr plan with no tangible resources both technologically and monitorily not to mention brain drain on human resource. Let us be practical and objective. Why are most of our neighbours better off. I dont…
Exporting Zambians and Expatriates whose salaries are pegged in dollars like a weak Kwacha because they get better receipts from exports and locally produced goods are cheap and they can sell what they import more expensively. Consuming Zambians whose earnings are quoted in Kwacha hate a weak Kwacha because imported products like cell phones, televisions, wines and spirits are then more expensive. Western Union customers in the diaspora love a weak Kwacha, because they send ‘more money’ to relatives. So, there are losers and gainers. BUT Prof Saasa is right. It is STABILTY that is most important because then, one can plan and budget and prices and inflation are stable.
BUT ZAMBIANS ..YOU GUYS KEEP YOUR HEAD UP..ZAMBIA IS A POOR NATION, WEAK CURRENCY AND ALL THAT..THEN SOME OF YOU ARE SAYING ECONOMY IS OK PLEASE GIVE ME A BREAK..ALL OF YOU SAYNIG ITS OK .WE CANT DEVELOP WITH MINDS LIKE YOU ..KEEP YOUR HEADS UP.YOU HAVE EYES BUT YOU DONT SEE ..
MOST OF YOU GUYS ARE ABROAD.. HAVE YOU GONE TO ZAMBIAN EMBACIES IN THOSE COUNTRIES ..?EVERY TIME ZAMBIA IS ASKING FOR MONEY AND HELP.THEN SOMEONE IS SAYING OUR CURIENCY IS OK.PLEASE WHATS WRONG WITH YOU GUYS .KEEP YOUR HEAD UP..
How I wished that people like Saasa would be able to articulate issues in the real world instead of proposing theories that have never worked for Zambia. There are many factors involved in development. A weak Kwacha alone will never improve Zambia.You can’t compare Zambia to China or Japan albeit their currencies are stronger than Kwacha. Zambia has nothing to export.Period. The copper export belongs to foreign investors. Our GDP is a fake one. We are much poorer than what appears on paper.Our country has been sold off.We have 2 cows, sell then for pennies to investors, and complain why they are not giving us milk.What suprises me is that many people do not see that. Middleeast is better off coz they haven’t sold off their oil fields.
Zambian will really be ruled by *****s who don’t understand the economy.Sata will never improve the economy.He will actually destroy the economy.How can train sweeper analyse the economy.Some can even talk about hating sata.No please.it is his CV which is shake.We know the new Constitution will require a degree holder to run for the presidency automatically he will be disqualified.
I never knew that the PF leader lucked the basic knowledge of economics. Its a nightmare to imagine him in office.
It is very sad for the poor Zambian nation which is need growth (partly through exports), to display such widespread ignorance about the importance of “weak” (the correct term is competitive) currency.
I elect to make a technical comment, since many of you are only supporting the debate based on who your personally favor. BE OBJECTIVE.
An objective comment is that a “strong” (correct term is overvalued) Kwacha will encourage many Zambians to switch preference to foreign goods. THUS UNEMPLOYMENT WILL RISE IN ZED. Also, our Zambia products (with the exception of copper) become more expensive to foreigners. AGAIN UNEMPLOYMENT WILL RISE.
The opposite is true for a “weak” Kwacha and the economy will grow. The fact is Zambia is better with a competitive currency.
To all MMD & chi Bwezani supporters. You should be ashamed of yourselves muleendanko nefyalo mwe fupumbu mwe. Did you know that Zed with all it’s resources in abundance(Natural and human) is supposed to be better than SA and /or Egypt? . Zambia is probably the only conutry where investors are tolerated such that they can come and make money and go back without any regard for the locals . Sata would only want to resident for the service of the Zambians not for power, the man is already wealthy .
We are getting nearer to 2011 Presidential and General elections. The Zambians will then choose the guy who is talking more sense.
Prof Saasa reminds me of the late Ronald Penza and his “micro” and “macro” economics language or garbage which only made sense to himself.
Prof, what people need is reduced cost of living by increased kwacha purchasing power and not these theories you preach.
sata will tell the chinese and whites to leave zambia and zambia will be like worse than zimbabwe.like he said on VOA phone in program
Ba Lubinda Gilbert, mweba sambilila , please tell us who runs the govet? is the president or thesystem that has been set in place? Any President has advisors, people that guide him and help him to run the affairs of the state, that is why even FTJ who had no degree managed to president for 10 yrs, so mr educated dude tell us your ingenuity, avail to us your university knowledge, How come the degree holder president has failed to completeley turn arround the economy of Zed even when the copper prices have started going up. Let’s be realistic guys , Zed is ours and ours alone no one will improve it or change it for us all of them will come and make money and go
# 91 you are right
Fresh you are my man. I had a privilege of staying and working in the Middleast Doha to be precise,Doha is in a smal country called Qatar with the population of only a million and yet it far much better than Zed, the citens of Qatar do not beg bread in the strrets nor do they go to look for work in other countries all because they have managed their resources well, they do not allow investors to rip them off their hight prized oil, and how much do have interms of resources in Zambia? Kenya only has wildlife and yet they are better than us, Zimbabwe only has agriculture and yet they are still better than us despite their situation . Come mwilatusebenya, think and grow rich use what you have , dont tell me you dont know what we in Zambia.
THE PROF IS CORRECT..IF YOU CAN’T READ BETWEEN THE LINES, AT LEAST SEE BETWEEN THE LINES OR SEE BEYOND THE LINES IF YOU ARE TOUGH ENOUGH…
SATA IS JUST A STONE THROWER…ZAMBIA HAS LIMINTED LEADERSHIP OPTIONS AT THE MOMENT.
#18, MMD Chief Bootlicker:
I usually do not agree with certain things you spout off, but your analysis on this one is right on point. Even some of your other postings are quite persuasive and make sense.
I am not sure on which side of the bed you woke up today, LOL—-just kidding!!!!
Truly is a Professor Saasa!!!!!!!!!! i thought the guy would give a simplified analysis full of examples to counter President Sata`s view. What do you expect from professors who have spent the rest of their lives teaching without ever working in a company———-? out of touch, just busy reviewing literature and not inventing any single product for the market. Sata is a smart businessman than this teacher Professor Saasa.
You people we need to be wise enough. Zambia is doing mush better now than before, thank God for giving us Mwanawasa the educated to rule us. I hope Banda will not destroy what Dr Mwanawasa and Magande worked for. People of zambia, need another educated leader again as a president and not these illiterate ones like Sata. We really suffered under another illiterate in the name of Chiluba who could not understand the economy at all. We are suffering because of Chiluba the non educated we allowed to rule the country, though Mwanawasa tried to fix a few of his mistakes. Illiterate no, no, please. Sata is like an empty tin which is too noisy.
Some of you bloggers here are comparing our economy to that of Malawi, honestly thats poor reasoning and it is a pity that it’s coming from the so called educated ones. Malawi GDP is 250, Mozambique 370, Tanzania 350, Zimbabwe now is also at 350, and the zambian one is at 950 according to BBC 2008. From this analysis it means zambia is much better. Zambians are much better than some of you living abroad staying in small 4 corner houses there in Europe. Zambians now own assets, some of you that side are just living hand to mouth, thats why we do not need sata the illiterate because he may spoil what we have built so far.
A beer costs $5 in this place were I stay and I hear it is about K6000. in most bars in Zambia.So , my question is , where is it cheap. Given that the Zambian Kwacha is 4600 to 1
#103, Mwansa, people in this world will NEVER eat GDP figures. If Zambias GDP is that high and if we have to comment on this article in its form where we look at the region, then Malawi is one such example. So dont mislead people by dissuading them from reality. All we need is how much is my kwacha going to sustain me from the day one to the 30th or 31st day of each month. Just compare the price of ubunga in Malawi and Zambia. Dont you know that people in Mchinji area prefer to buy items from Malawi? Have you asked yourself this question? you may think oh there are no zambian shops nearby then i will tell you what of the chipata boys far from lilongwe, why do they risk smuggling goods from malawi if at all we have a better GDP than theirs? Learn some stats boy and in this world no one eats
such good looking figures.
Che Guevara, I have very limited economics knowledge, going by your statements, I really don’t know who to call Prof. You or Saasa. My field is Workforce Education but you have simplified this debate to me that I feel Saasa sounds like he needs consulting you before he opens his mouth with regard to economics and the numbers thereof. What is intriguing is that this man Saasa, is a prof but seems not to support his arguments with references or numbers. He sounds like a street economist. He talks about Malawi but not tells what is wrong with the Malawi currency or how it relates to our Kwacha. That is basic in every comparative study. How about the PPP of the two currencies? If Ithink ba Saasa babwela pofye.
There is no such thing as strong or weak currency. It depends on value. Strength or weakness can be changed depending on monetary policy. Value is dependent on the gold reserves. The US federal reserve prints the dollar without refernce to this. Pres Kennedy probably died coz he signed an order to restore dollar value vs gold & siver reserves.
Oh …No, Saasa is such an embarrasment to the education fratenity. A long time ago, if a high profile person made such abnormal assessments, he would be killed. Mwalatusebanya. This sounds like another professor who said that UNZA students must not stay in private residences. Imwe, are these people OK?
His is a very cheap argument that could only stem from a weakened viewpoint, motivated by either madness or mere siliness!
CIAO..donot blow with the wind my boy, stop, listen and look then think…not just because the boat is floating then you want to jump on it, you a ship not sata’s small boat
Kalos2020, the Prof is right malawian kwacha has more value than ours but zambian economy is better than malawi…that means we are on the right track, it will take afew more years. Thats why we need a good leader: not banda, not HH and certainly NOT sata…a good and focussed leader with good education who can see beyond what simple and cheap minds.
I found reading these arcles very nice. Zambian politics is not about education is about popularity. if this said so, then RB is leaving office come 2011 election. There are a number of things RB got wrong, one: of them is the appointing peple from one region or tribe. 2. when you look at the appointment you find some areas like southern province which has no minister in RB’s government: I do not know how he is going to campaign in this province.. This province will vote for sata as long HH is made vice president or president. You can not win an election already giving up battle grounds to your enemy. All those saying MMD will win are just dreaming and lack of focus in zambian politics.
It is also very suprising to me, some of you seems you have no ideas of what is happening in zambian. The problem with HH is the way he came into politics, he was not known. They still believe he has future in zambian politics but he should save as vice president to seasoned politician sata. HH will gain alot in his capacity as vice president to sata than wanting to be a presdent because other people still hates because of the way he came. This is the way sata made popular from nowhere. sata took over Lusaka and copperbelt. They just need southern province. The are very popularous provinces in zambian politics. From this pact UPND will benefit alot because they have more educated persons than PF. They will take most ministerial positions than PF. viva pact…!!!!!
We cant move economically if we cant get the barest fundamentals write. Bloggers on this forum are among the most eduacted in the Country, I scared to think about the rest of the Country if the elite are so economically illiterate.