Fitch Ratings has revised the Outlooks on Zambia’s Long-term foreign and local currency Issuer Default Ratings (IDR) to Negative from Stable and affirmed both ratings at ‘B+’. Fitch has imultaneously affirmed Zambia’s Short-term IDR at ‘B’ and Country Ceiling at ‘BB-‘.
“The revision of Zambia’s Outlook to Negative reflects the agency’s concerns about some of the government’s recent actions and announcements, which bring into question the direction of economic policy,” says Carmen Altenkirch,
Director in Fitch’s Sovereign ratings group. “The recent decision to reverse a privatisation deal without as yet compensating the investing parties could undermine property rights, while planned reforms of the mining and banking sectors could risk unintended consequences in terms of their potential impact on investment, and consequently on the growth outlook and macro-economic stability,” added Ms Altenkirch.
The authorities’ intentions to implement reforms fight corruption and reverse perceived flawed decisions made by the previous administration are creditable, but in Fitch’s view the speed and direction of current policy making increases the risk of policy mis-steps. However, Fitch is aware that policy direction may moderate as the government assesses market reaction to its initial decisions. The government’s decisions to reverse the privatisation of ZAMTEL and investigate the privatisation of ZANACO represent perhaps the most worrying recent development.
A further concern surrounds a recent announcement by the Central Bank to
significantly increase the minimum capital requirements for the banking sector. Although the government’s objective of increasing the size and capitalisation of the banking sector is laudable, Fitch is concerned about the potential impact on asset quality, inflation and foreign bank participation in the sector. Comments from senior government officials about the possible re-introduction of the contentious windfall tax as well as increasing the government’s stake in all mines to 35% highlight a further area of significant policy uncertainty.
Zambia’s economic performance has continued to improve over the past decade, with growth averaging 5.4% over the period and 6.8% during the past five years, well above the ‘B’ median. The economy has benefited from a more stable macroeconomic policy environment, an improved business climate, as well as a rapid increase in copper prices, which has underpinned rising foreign direct investment in the mining industry. The prospects for growth beyond 2012 are less certain. Growth in mining production could be constrained by weaker growth in China, Zambia’s main export destination, as well as persistent capacity constraints.
However, if the new Patriotic Front (PF) government’s policy framework ultimately remains broadly unchanged from that of the previous government, with a continued focus on sound monetary and fiscal policy, as well as continued efforts to improve the business environment, a more favourable medium-term growth outlook is possible.
The budget for the 2012 fiscal year, released shortly after the new government came into power, reflects a slightly more expansionary stance. The deficit is expected to widen to 4.4% of GDP in 2012, up from 3.1% in the previous fiscal year. The government forecasts a material reduction of the deficit in 2013, falling to 1.2% of GDP, but Fitch views this target as optimistic, given that constraining current expenditure while dramatically improving the tax take is likely to prove challenging. As a result, Fitch currently forecasts a deficit of 2.2% for 2013. The greatest risk to government finances, over both the short and medium term, arises from a potential failure to curb current expenditure, particularly on wages, which consume 43% of government revenue, at the expense of capital spending needed to improve the long-term productive potential of the economy.
The government plans to issue a USD500m Eurobond later this year, which will be used to fund investments in road and energy infrastructure. As a result, total public debt will rise above USD2bn in 2012 or 22% of GDP. Additional borrowing, particularly at non-concessional rates, needs to be invested in projects with a high economic rate of return.
Fitch will continue to monitor the government’s actions and policy announcements closely over the next 12 months. Any crystallisation of Fitch’s concerns over policy direction that leads to a weaker investment environment with negative implications for growth would likely result in a downgrade of the ratings. Conversely, evidence of a fiscally responsible policy framework, growth-supportive infrastructure investment and progress on deficit reduction in line with targets could result in a revision of the Outlook to Stable.
[Fitch Ratings Limited www.fitchratings.com]
Why should government’s decisions to reverse the privatisation of ZAMTEL and investigate the privatisation of ZANACO be worrying, you chaps are always happy to see the natives being short-changed.
I can foresee SENIOR CITIZEN and bitter side kick ENGINEER silviating profusely and impatiently typing to post a comment to this article.
one[1] thing common among pf chaps is lack of intellectual reasoning. they are just impossible to reason with.
Kaponyas are kaponyas. What Fitch is talking about is well above them, all Greek to them.
Developed countries developed because they have people who think, like Fitch has demonstrated.
We will not be worried even if we were downgraged to C because of Zamtel. the only worry is PF’s failure to fulfill its election promises, it Homosexual agenda, isata’s dictatorial tendancies to moves districts without consultation, appointments of people based on their tribes, BA64 issue and street vending.
maxwell its because it reduces incestor confidence……i am for the idea of the repossesion of zamtel but the way it was handled was wrong………furthermore careless statements such as the one Bob Sichinga said on the fake kwacha give the ipression that the govt doesnt have any economic policy in place ………..that is alos worrying…….furthermore we dont need a foriegn company to tell us that the economy is in chaos just look at the foriegn exchange rate
The cycle continues, we went from thieves to kabovas tsk tsk
did we not tell you? you can not let Monkeys in a maize field…
RB you will have the last laugh…..
the boat is on auto-pilot….
The boat is at sea with no compass and a dead engine!
And a strong wind is also blowing strongly, just imagine.The end is doom.
The instability and lack of direction shown by the government is worrying because as an investor (or minister for that matter!), you don’t what will happen the next day. One second you’re revamping a dying Zamtel, the next day it has been repossessed without compensation. Does this spell investor confidence?
Brace for tough times, you won’t need to tighten your belts, just use a rope and adjust accordingly.
The PF government is taking Zambians for a ride.There is so much uncertainty and instability.The country is being run like a creche.Lord have mercy.RB, missing you already.MMD please re-organise yourselves because Zambia needs you.Why should the progress Zambia has made be run down by a witch hunting, tantrum throwing government.
That’s what happens when you talk too much without consulting various stakeholders. Fitch is not against the reversal of ZAMTEL, it’s the rhetoric of nationalization being spread back into 1990 privatization. The PF needs to be very careful and need to work within budget. These unnecessary commissions and irresponsible pronouncements of 100% salary increments must be discontinued. You can’t borrow for investment with a bad rating.
These white people are coming up with stupid ideas for zambia. Look what the UN is doing with the issue of GAYS
My friend. When it comes to knowing how to develop an economy, teh whites have brains. Lets learn from them. Africa is poor because of poor management of our resources and our economy. What Fitch has said is what they say to any country. Please listen and learn from the whites. Lok at their countries. Of course moral things like homos are to be resisted. But they did not develop on the basis of homos. It is because they properly think and plan economically.
Stupid ratings. Why didnt they underate Zambia when Zamtel was corruptly gotten?
Surely MMD should wake up & bring back sanity in governing our resources. Ministers are being shifted from one ministry to another in no time & you expect investors to have the confidence to put money in with such management.
Well, personally, am not really concerned about the downgrade and these happen all the time and if you read between the lines, this is just a warning shot being fired by the rating agency and I hope this Government of Kaponyas By Kaponyas for Kaponyas take notice that they are putting this country in a hole and it is time they stopped digging further.
What am concerned about was the data released by the CSO for inflation last month, and though it should the lowest inflation rate ever, the last line in that report indicated that trade account surplus almost halved from K470bn to K270bn. That was drastic and am watching this figure for the next 6 months and if it continues going down, then I will consider this a trend and ran for cover
Bootlicker, you talk sense. You are one of the few enlightened on LT. Please keep us updated on the movements on that trade account in the next 6 months. I hear you.
No 1
You may not like it… the fact is PF has no depth to run government. The may have been good as an opposition and that was it. Winter, Bob etc are intellectual who have achieved nothing and can never take you anywhere… lets not even talk about your president SATA..(for any doubt he his not my president)
The MMD may have had faults… the reality is the can produce a bus load of intellectuals. Point one country in the world were you have a president who never finished primary school. I can point one ZAMBIA
Even Zuma in SOuth Africa at least went for some Night School
This economy still has a lot of juice left by the MMD and I hope these people realise and wake up and start getting concerned with governing than being shocked and not belieeving it that they are in power.
I have a lot of faith in sane minds in this Govt, particularly people like Alexander Chikwanda and Guy Scott, and I hope they really reign in this over exuberance by Kaponyas around them and put this government feet down and start sailing their boat to greater places.
What people don’t realize is that Zambia’s darkest age was between 1996 and 2001 and Sata was at the center of this era of MMD, and it took a lot for Levy to bring back sanity, which RB consolidated and I hope we are not taken back to that era again. PF is simply the bad part of MMD in that era
Yeah, I remember the Chawama hatchets by you know who.
PF can actually use this Fitch’s report as a some blueprint, making sure that they address every point accordingly in order for them to assure investors. Fitch has done them a great favour, a depth of analysis that may be they themselves, PF, could not have mastered with those scatter brains of theirs.
I just hope that wiser people in PF will say, Hey guys, let’s use this report intelligently.
A little turbulence only makes the boat stronger. Nothing unusual here folks. The US also has a B rating and it is not the end of the world.
I guess we must give the prophets of doom enough bungee rope to hangs their behinds – enough voice to make them selves f.o.o.l.s. When the turbulence is over and the boat is sailing swiftly, I hope the prophets of doom will be decent enough to admit they were wrong, but we really don’t care. Look how a non-issue like homosexuality has been blown out of proportion by idol sectors of the populace. We are not swayed by negative unproductive feedback, but use it to advantage so please continue yapping boys and girls. It is your right to yap.
The US has an AA rating instead of an AAA rating. Get your facts straight.
Hope you are not burrying your head in the sand. True to pathological optimism, eh?
Nations that have advanced economies did not develope on the back of kaponya mindsets. Look at RSA, UK, Europe, USA, Japan, Australia, etc etc. It takes, thinking, planning, foresight to build an economy.
PF is in a huge storm economically. It’s not a little turbulence. They have no clue and are not in control. That’s why everyone is rebuking them. The dials are there, but the pilot has no clue what to do.
This will likely influence the much anticipated Zambian bond issue in a nuanced but adverse way….
On ZNBC Business news (22nd February, 2012 quoting Chibamba Kanyama):
‘Government needs to consult widely on the issuance of the US$700 million bond in view of the likely negative perseption of the economy by investors….A lot has happened lately. The real winners will be the legal and financial advisors as we expect to pay a premium for it. The catch 22 situation is that the bond is already factored in the 2012 national budget, implying government still has to issue it at all cost even though investors may not rate Zambia as stable at this stage’
Haha,we told you so.Now you have clueless folks running GRZ whose only qualification was “personal appeal” and witch hunt.RB left solid ratings from Fitch,bumper harvests,record forex reserves,high FDI inflows,a stable exchange rate and a solid growth rate.You decided to throw away that gold plated legacy in favor of a village clown who is still fiddling and lost doing monthly reshuffles.Running GRZ is not about popularity.Even Mweene is popular but he can’t run GRZ and thats where Sata fits too.
Village clown. Ha ha ha aha aha aha aha aha aha aha aha a…………..
Stop worrying about how other people should be having sex and start acting on attracting investors and 21st century development. Simply stop wasting time on silly issues
not surprising. even before voting i knew that pf were capable of driving the economy to the dogs, more to come.
the whites are always keen to sack our resources for thier own personal benefit.they will always want african govts to compromise with them,they want to do business on their own terms,getting the lions share and leaving us with bread crumbs.they can even impose sunctions if that country refuses to adhere to their terms.they want to bring investment corruptly and we say nothing about it.they have criminal minds and it bothers me too much.am looking forward to a time when african countries trade amongst themselves.these whites dont really want other economies growing.look at how the US panicks when CHINA is booming.they start talking,trying to catch up.they sheep in goats skin.they want to monopolise everything.we should not care about the down rating.we dont starv anyway.
Why always play the race card. Somebody tells you to manage your economy better, you say its because he is white. Aren’t bloggers on LT and Zambians in general been raising the same concerns about PF lack of depth?
Have you not wondered why Africa is always backward? its because of poor management. This is what we want to address, otherwise we will always be a failure.
ahahahahahahaha Bazooker, but as Senior citizen said indeed the change to negative status of the rating is of no concern. It’s the response the PF and opposition think tanks shall come up with that is the meat and bones. DAMBISA for consultancy any one. Why do we not utilize that young lady imwe Bantu; or professor Clive Chirwa?
Nothing to worry about the same thing has happened in Eurozone.
Such news should make true statesmen concerned.We are supposed to be moving in the positive direction (forward) and not in the negative (backward).PF should give this issue the attention it deserves.Dont dare down play it,take corrective measures for you are lucky there is someone somewhere providing free advice
#12,good point ,our NTE ve dropped significantly & this should be a cause to worry.we need consistency frm the pf for once bob sichinga looks like is lost!as rgds the ratings obviously its a warning sign bt remember the european crisis also has a bearing esp.on our free falling kwacha.the govt should never go to sleep mwe bantu!lets engage the populace as we move forward
No 23
“Nothing to worry about….” yes it has happened and their brothers and sisters are giving them money to survive…. am sure you are thinking Zimbabwe will help out Zambia good thinking …
Don’t be fooled economics has always been a science…. people thought it was art to be presided upon by village clowns
Even several countries in Europe are down graded by this agencies from time to time. The idea is that you hear their views and take appropriate measures. It is not the end of the world, nor does it give anyone any political capital. Some bold measures have to be taken regardless of what other institutions will say.
NOTHING TO WORRY ABOUT. SORRY
The reasons given for down grading are not justified.One would expect them to up grade bcoz fighting corruption will create a more conducive environment for investment.Did they down grade our economy when Zamtel was privatized corruptly? It will be very foolish of them to come back in the near future and upgrade us after realizing that fight against corruption has created a better environment for Business.
#22 Its called capitalism my friend. What do yo mean whites? What about China (US$ 10 trillion), Japan (US$ 4 trillion), Thailand, India(US$ 4 trillion), Indonesia and Brazil. Stop being inferior and work. South Korea(US$ 1.4 trillion) has productivity more than the whole of Africa (South Africa US $ 500 billion), Egypt and Nigeria included) combined at (US$ 1.3 trillion) and Brazil (US$3.5 trillion) has three times the productivity of Africa. The essence is turning your enviroment to your maximum benefit. What we see in Africa is self destructive attitudes to politics, ecomics, technology and even cultur.The work culture is very bad. More people are loitering the streets or producing 2 dollars a day.
those who are saying nothing to worry are lost. the status of the economy is the main thing. what do you mean nothing to worry.
By the way those calling PF as Kaponyas, be reminded that we are very proud of being Kaponyas, becos in two years from now Zambia will see the kind of development it has never experienced. Ours is not theoretical or book kind of development like the MMD one. We shall build Hospitality and Schools, We shall promote production of other food crops apart from maize, we shall build new roads between districts. The end result is reduced poverty levels. We hope these companies will upgrade us with such achievements becoz no investor confidence is involved in this one but real issues of bring food to the table.
Why in 2 years time? This is not what Sata promised, 6 monts now it’s 2 years in bemba? Foolish!!!!…All bembas are Kaponyas thats true,you’re good at that…No homo am only being true..2 years from now Zambians will see the worst Govt. ever.!!!!!!!
And if you don’t build roads between districts, you’ll just make new districts to go where the roads are, right?
LOL! Typical Kaponya language. Empty promises of we shall do this and that. You may as well have 100% salary increament!!
Dear one, without money you can do nothing. Investment makes money. So you need a conducive investment climate.
Thanks Kwekwe!! We are listening to these educated people and their complaints. They are still the minority; so ignore them. Their Zambia was one that promoted their interest only, corruption even at places of school, council and the rest. My file got lost at the ministry of lands for 4 years; after PF came in power, it resurfaced. Can you imagine!! Better an ***** in state house than a corrupt educated person.
Building Hospitality indeed. Hospitality to poverty and disease? lol!
guys also refer to the EIU country report Zambia February 2012. Completely the opposite of this “OPINION”
@32 above, I meant Hospitals
Presidents should be Degree Holders….This must be included in the constitution.Am ashamed to have Sata as a leader.People open your eyes,this not Early Stone Age to have Sata as the president..changing ministers from ministry of sport to ministry of Health….what?? And bembas are supporting this Nonsense…they are saying “nothing to worry about the down rating”,what? You are foolish as your President with no idea how serious is this Rating.Wake up,you triblists push your president before thing get worse.
You speak sense, only drop the Bemba thing. It’s not necessary to incite tribal bigotry. Kaponyas and Bembas are not the same baby.
I am Bemba. we are one nation, right?
Presidents should be Degree Holders….This must be included in the constitution.Am ashamed to have Sata as a leader.People open your eyes,this not Early Stone Age to have Sata as the president..changing ministers from ministry of sports to ministry of Health….what?? And bembas are supporting this Nonsense…they are saying “nothing to worry about the down rating”,what? You are foolish as your President with no idea how serious is this Rating.Wake up,you triblists push your president before things get worse.
My friend, not all bembas voted for sata — grow from your tribal view and look at the bigger picture. I’m bemba and I did not vote for pf.
One Zambia, one nation.
My friend am grown,haven’t you heard the noise bembas are making? They are claiming to be the majority in Zambia..and several bembas had posted silly comments here recently….it is very sad to see some of you supporting the foolishness of this Govt.
One Zambia One Nation indeed!!!
Forgiven son, we Bembas come to you in peace. Dont allow yourself to be tribal. Do and say what you think is right, not what other people make you. So far 2855 have read this article but only 61 have commented. Meaning bloggers are only a tiny fraction of the genearl readership. And you allow the views of such minority to make you hate Bembas? Come on, you are wiser than that. You seem to be paying to much attention to Kaponyas. The vast majority of Bembas are not tribal. Get to be friend some. You will be amazed.
As a matter of fact, not every one that speak Bemba is bemba. So you could be insulting teh wrong people.
This is is just friendly advice. If you dont want to make friends, there’s nothing we can do about that, it’s your decision. We are better off friends than enemies.
The mistake PF made was to overhaul the whole system, they would have left permanent secretaries at list and appointed a team not on merit.
They ve no option but to swallow their pride and consult from MMD now.
Sense!!!!!
These PF Donch Kubeba, have been told now , thats its not just talk but work to prove your worthness of your office, Dont KUbeba every time, now trouble begins right there, let watch and see what happens, these people that suffer from diahorrea of the mouth especially Bob Sichinga and Kabwili, we are watching.
CONSEQUENCES ARE TOO PONDEROUS IN MAGNITUDE
Understand the perils of leadership then you will get fired up to be one of the Generation change agent. Throughout human history it takes visionaries to build a nation not aimless barking, haphazard and vacuous threats on a strong willed generation of those who have tested fundamental rights. Without a vision people perish and kaponyas have no vision but heads full of drivel and doomed circuses to show. The mess you the country is witness is the best they can offer. Here we are in a historic quagmire under a regime of kaponyas by kaponyas for kaponyas.
@32
Why in 2 years time? This is not what Sata promised 6 monts now it’s 2 years in bemba? Foolish!!!!…All bembas are Kaponyas thats true,you’re good at that…No homo am only being true..2 years from now Zambians will see the worst Govt. ever.!!!!!!!
Waste of space!
The mess you are seeing in our country is the best a boart of dry bones can offer. Here we are in a historic quagmire under a regime of kaponyas by kaponyas for kaponyas.
Dont even blame the Euro problem.It has nothing to do with Zambia’s problems.We had a worse off meltdown in 2008 than this ka euro problem.Neighbours have stable economies- look at SA rand is appreciating against the dolla despite their huge tarde volumes with europe and the pula is alos stable.malawi kwacha is stable.Europe’s problems havenothing to do with Zambia,just accpet that you voted for a clueless govt of Kaponya for kapaony by kaponya.You will be in hell in the next 5 years with these lumpens.Lawless is the order of the day see what happened in Kitwe taxi drivers yesterday and think that is an environment where investors will keep their money forget.
Forget about Malawi Kwacha. The stability of these currencies does not work to any business person on these countries you are talking about. SA rand is very volatile and not stable. Maybe the Pula. Check you econ.
You guys make me laugh!!!Why is it that Zambians never analyse things?The US of Obama has been downgraded and so are some of the EU countries.Cause for concern?
If you guys want to move forward you need to stop bickering on silly land issues or pre independence unfinished businesses which will not benefit the nation in any way.
I feel sorry for you!
The govt is not working at all. All they do is talk talk talk; they must be on some network (which has almost the same name). The govt can actually be used for an advert; talk talk talk talk and I wish it was sense they spoke.
I think the govt has realised that running the country is not the same as running a kantemba. Secretary to the cabinet has directed that salaries for civil servants and institutions that receive grants from govt must not increased by more than 4%. i wonder how our health personel will feel about this from 100% to 4%. ouch….
@ You ***** how dare you call all bembaz kaponyas. People you call kaponyas are in govt. and the so called “educated” kissed dust.I think the so called educated must be very dull for a kaponya to beat? Just admit you are very dull bunch of people who lack strategic thinking and perceive issues through dark glasses.
The problem that we have in zambia is that they are few literates and as long as they make money they won’t wake up to go and queue up to vote thus leaving a few of us who care in a quagmire
And its downhill from here ………… and who will feel the pitch, the same poor, unemployed, that PF claimed to represent. Africa … 5 steps forward 8 backwards.
I remember very well that PF candidates in the previous elections refused to be featured on debates including their presidential candidate hiding in the slogan of donch kubeba kanshi it was due to lack of econmic program to run the Govt shame on these pretenders.SATANA only cpmes to destroy and not to be build as the word of God is always true.How do you people sure vote for a serpent for president of a christian nation.You reap what you sow.
The lust for lucre and power is easy enough to understand. And once a nation risks themselves with you in power in an intentional gamble, instead of proving yourself positively as a clueless motor mouth you really don’t have much choice about how to behave but mining from the Dictator’s handbook of doom; it’s like riding a tiger; you’d better not scheme to circumvent the democratic spring.
You, my friend are just a gong at the rail road crossing clanging ever so loudly and vainly as the train goes by. You wallow in your bitterness and employing all the big words in the Oxford dictionary, that gravy train that you used to enjoy under ale bee is no more, FINITO!!!
Keep QUIET!
These rating are a big reflection of what the world is thinking about Zambia and the donchi kubeba policies. All important stakeholders have this report and making decisions based on this findings.
Ubwanto has no compass to get us to the shore. It is heading into the deep blue waters infested with crocodiles and water beasts.
Its amazing what level of understanding of economics people can exhibit due to political blindness… i think the level of intellect has really gone done in Zambia. No wonder UNZA is now rated no 61 in Africa.
Fitch downgrades Zambia from “Stable” to “Negative” and some people on this blogg say its not a problem.
Do you really no the implications? Its mean all the corporate more especially the big mines operating in Zambia will now have to pay higher interest rates on short and long term borrowings. What that means is cost of production will increase and that means a drop in revenue and that means Government will collect less corporate tax. Hope this simple 101 help some of you who are intellectually challenged and from the postings here you seem to be in the majority
This kind of thinking is well above Kaponyas. I guess Sata is looking at that Fitch report scratching his chin, what the hell are they talking about? LOL
I will be interested to see the govt’s response to this.
Sata will say its a fake downgrade.The way he labelled Chibamba Kanyama as fake economist..lol
While the fight against corruption is a good move forward, the respect for the rule of law is even better. Better laws [constitution] would prevent abuse by civil servants (including the president!). as it stands, we can have all the COIs and ACCs, and trials, but as long as the law [constitution] stays as it is, even the next government will find PF wanting.
Let us get a good solid constitution in place, one that is not based on witch hunting the previous admin, one that will not empower the current admin, but one that will stand the test of time, one that our children and our children’s children can use and rely on.
But who am I folling, we are too busy having fun with the circus taking place. :-w
#1, you have said it all for me. These guys are the “nichekeleko” type. If you plug the hole from which they feed their greed, they downgrade you.
We need our own internal systems that do honest economic evaluations and assessments, to know where we are.
To know where we are economically.
Dolar nainina ububi sana worse rebasing of the kwacha has also contributed coz every jim and jack is converting their trillions of kwacha to dollars..Economists should have seen this coming with the announcement of removing the 3 zeros..
I wonder the kind of advisers surrounding sata coz people are running out of patience…PF should be very careful and analytical otherwise the will just kick themselves out of office, Zambian people are very serious about change now
Let the FALL begin.
No 50
With an economy of US$17bn and you want to create your own system???? Go to Zimbabwe were the tried to create their own system and see what happened? Don’t try to be a China, India or Brazil. Just obey the economic laws of nature and you will prosper. Life is easy the problem with Africans we try to break the rules… thats why Africa is were it is.
Chibamba Kanyama, earlier predicted that because of the actions taken by government on various issues including issues of minimum wage, the investor confidence and general rate of investment would slow down. He was labelled by the head of state, SATA, as “Fake Economist”.
We are yet to see the real fake economist now, and in the near future!!!!!
School is good. Chibamba, George Kunda etc have been to school. But the uneducated call them fake!!
Do you know why a iron ore mine in south Africa’s more valuable than a gold mine in DR Congo?
Ask FQM they know better!
Enlighten us kaili
The GRZ plans to raise the $700m euro bond as a means of funding the budget.With the downgrading of our economic outlook to negative it will be very difficult for the GRZ to raise that money.That will in turn affect the budget.The GRZ will then be forced to raise the taxes that they just reduced.This guys have no clue in running the country,it is job on training.
FDI into the country will be affected ,meaning our economic growth will slow down.
1 + 1=? Why spray perfume on a pig. That is what Zambia did to PF ke ke ke ke ke ke ke ke ke ke\:d/
What is this??
Why is it that most you such as senior citizen and The Engineer only resurface from your hiding when we have an issue again the gvt. It simply shows that you do not mean while for our country. Your are just political bootlikers of MMD thieves. We want to hear your comments even when PF scores a plus and that time is coming. At least MMD chief bootlicker is consistent and very objective. he is with us all the way. Wait for your DOOM to come because PF is in leadership for next 20 years. These whites and their racism wanted to bring Obama down but failed, the down grading here has come about so as to discourage GVT from repossessing ZANACO if found wanted. Only a fool can pay attention to this Ru.bbish
EXACTLY, they are just prophets of doom, nothing but loud gongs on the side walk!!
I am saddened by the level of unpatriotism of PF cadres. As long as sata aleteka, they will find solace in Zambia falling over the clif. You can you call the downgrade meaningless mother father. It means the interest rate for the $700million bond will be high. Its a Junk bond before issuance. In case you are a typical pf Kaponya, I will advise that Greece is defaulting on paying interest on Bonds because it was downgraded and therefore the interest has to rise
No 58
Very simple answer. I have absolutely NO faith in your PF government and your president. Show me what plus PF has scored. I will show your the record bladders in 90 days. In your wishful thinking PF is gone in 2016 that if we don’t have a presidential by election SOON. I respect your views about PF and respect my views.
No 58
The other reason is that this is a matter of national importance… i do not need to comment on your president changing cabinet every week… just do not have the time to waste on a Village Clown
Instead of appointing Chibamba Kanyama as secretary to the treasury, Sata appoints a fellow unqualified Bemba man whose experience is running a pub at Kamies in Woodlands. When Chibamba advised that the minimum wage bill must be handled carefully, Sata retorted that these fake economics were getting K30million kwacha and they dont wants others to have good peks. Now who has the last laugh?
Two groups of bloggers comment on this down grading of Zambian Economic outlook by Fitch Sovereign Ratings. There those Intellectual Zambians whose concerns are genuine as they scan the global economic outlook and watch helplessly as our country is plunging itself in irredeemable and catostrophic levels of difficulties to progress economically. The other group is typical of Kaponyas or Kabovas who dismiss Fitch ratings and believe Zambia is an island. The stalk of truth remains that governance is not just empty rhetoric playing on the local playground to unschooled masses. Rule of a nation is bigger than one individual and more serious than than fighting corruption as an end in itself.
The two groups actually represent the electorate!! That’s how we ended up with a Kaponya govt. It’s like water and oil. Cant mix.
This truth of facts is reflected in Fitch’s ratings as follows “If the new PF govt policy framework reamins broadly unchanged from that of the PREVIOUS GOVERNMENT with a continued focus on SOUND MONETARY and FISCAL POLICY as well as continued efforts to improve the business environment, a more favourable midium-term growth outlook is possible. This simply put is that PF govt can not craft altenative economic policies to gun any economic growth except to pursue the economic path MMD chatted for the nation. There is no shame in following tested MMD economic policies that have registred growth for the nation. This advice is made without prejudice but for the love of our people and nation to benefit from our efforts as Zambians.
Exactly!! To that you can also add fighting corruption regitimetely – probably that’s the only mistake made by mmd. But instead of taking in the good aspects of the MMD and improving on it, the PF are busy fooling “their” followers with rhetoric
No 61… need i say more????
This is a clear indication that we are headed in a wrong direction. We should take necessary course corretion measures as a country. Only problem is the goons we have in GRZ are not competent.
I am a proud UNZA graduate and even more proud that I am intelligent and I have a good understanding and working knowledge of world politics and economics. Maybe I would even be more intelligent than Aussies if I had studied there :-). But the point I want to make today is that like my Aussie friends, I think that PF can be likened to the Costa Concordia with a faulty crew, poor judgement and all.
The 50 year old Captain was busy helping himself to a former 25 year old member of staff as they crashed. Learn not to hunt at work, I say.
The Fitch report has an excellent depth that PF govt, if they are wise, can use intelligently to improve Zambia’s attractiveness for investment.
Do PF have a Think Tank of some sort?
This is a wake up call that PF is not managing the economy well. This is a free advice from Fitch to PF. Something that the brains of PF may not have been able to produce themselves. They should study it, it’s implications, and take necessary actions to ensure that there’s long term investment to create jobs and put money in people’s pockets.
Not a very good start is it! The government should stop messing about with the privatised industries. They should be left alone. They are in a much better position to increase productivity and hence economic output than government institutions like Zesco. The should also have a coherent message as what exactly they really want to do instead of wobbling all the time.
Those who dismiss this report should consider this:
1)Fitch is an important “rating agency” taken seriously by investors around the world!!its reports determine “investor confidence”,that is the likelihood an investor will pour his money in a country!
2)Germany is able to attract massive investments and borrow from the bond market at 1.2% due to its “AAA” rating!!with this report,PF GRZ will struggle to raise the $700m bond and even it does,it will be at an exorbitant rate!! Right now,a Zambian 20 treasury bond is about 20%…
If this is rubbish to you then I hope you wont mind Zambia remain impoverished for another 25yrs coz it has no capital for infrastructure projects!!
#58 Kwekwe
If you have say £50bn cash and you want to invest it so that it can grow, could be you are a pensions house where people have deposited their pensions for their retirement, you would need to invest wisely ie in securities, financials, companies or countries where your money will grow. For that you need advice on which investments are risky, safe or no-go’s. This is what Fitch provides, information to investors.
Investment creates jobs, which PF wants, to put money in the pockets. So if Zambia becomes a less attractive investment because of PF lack of depth at managing the economy, people will not invest in our country. Our cost of borrowing will go up and it will be bad news for everyone.
It’s not about racism. It’s the economy. Dont hide in racism, its cheap.
King Deceit
Quote:
‘I am a proud UNZA graduate and even more proud that I am intelligent and I have a good understanding and working knowledge of world politics and economics. Maybe I would even be more intelligent than Aussies if I had studied there :-). But the point I want to make today is that like my Aussie friends, I think that PF can be likened to the Costa Concordia with a faulty crew, poor judgment and all’.
Is that what UNZA has done? and … and …and, ….working knowledge?????
=))=))=))
King Deceit,
But I like your tag, I claim it for myself. I hope you don’t mind? hahahaha
this report is indicative of socio-economic and political state of Zambia:abrupt “reversal” of Zamtel sale,Liato germinating K2.1b,stupid announcements of fake K3t & 100% salary increases etc
An investor’s mind (local or foreign,big or small) will reason like this:
1)do I want to invest in a country where the govt might repossess my business?remember “confidence & perception” are instrumental to the economy.
2)do I want to invest in a country where the govt had no tangible fiscal and monetary policies??
If the answer is “no” to these questions then GRZ won’t get its $700 millions bond and nor will serious investor bring in his capital!only scrupulous Chinese,Indians,S.Africans will come to reap you off and take their profit after the 5 yrs tax holiday is over!!
Oh dear look at our partisan friend: The Engineer (Australia) over there today he/she is even hosting a Q&A session * shaking my head*
It happens when you have a Kaponya for president. In reality this is the legacy of MMD! Good leadership entails the future is planned for. It is what defines an excellent from a mediocre or poor one. How have they prepared for when they will NO LONGER be there or able to lead – continuity! KK, FTJ, LPM all failed us on this score! Look at Botswana – succession is never in doubt. Do we know know who is to take over from Sata – and why not? Mandela groomed his successor – The whole world knew Zuma was likely to succeed Mbeki…
#75, let me make it simple for you to understand, my reference to UNZA was meant to correct the impression by some of our respected colleagues that the only intelligent people are those who crossed the seas in search of studies. You may be aware that UNZA graduates abound in many reputable foreign institutions including universities, banks, even NASA for good measure. So let’s leave this out of our discourse on the sinking Costa Concordia, shall we?
ok so what..? these ratings, white pipo are messing with us guys,just bcoz the system is failing in Europe now they want to share it with us, check all they want is telling us what to do,its always THEM before US…Africa lets create our own system of trade and we will make it its high time we woke up…
lets brace ourselves, UNIP days are coming. am sure we all must have seen this coming. it starts slowing just like this. soon zimbabwean will be going back to their country and zambians will follow them to zim to sell sweats on the streets of harare. and #2 that thinking is counter productive
#82 Even Bishop Mpundu’s sisters will have to trek to Harare to become 5 pin prostitutes!
The Question is which Investor look at economic performance of African countries to decide whether to come and invest or not? Zambia is not Europe. Investors who come to Africa, look for resources esp Minerals and most of them are crooks. If you have it and they need it, they will come. You think if Kwacha is dropping and you have Copper or God in Mumbwa they will not come? Genuine investors to me are those who invest in production but unfortunately Zambia cant attract many of them because of the small population.They would rather produce in RSA and just supply Zambia.Other investors Zambia attracts are Indians and Chinese with their Tuntemba shops. Instead of us looking at these statistcs and thinking we are doomed,we should invest in our country.The best investor in Zambia is a Zambian
What upsets me is that the same corrupt capitalists ‘views’ have to determine the price at which we do business with their ‘mother’companies and determine the cost of new investments into our beautiful country. Now even their own brothers are questioning the whole rationale of these ratings and how impartial and pure these ratings are. Its simple: I rate you very lowly and then give you aloan at 15% instead of 5% because you are risk investment! Thas why I agree with all who say this whites are thieves! Even Chinese are Caucasian!!
It is amazing to hear the so called Educated Graduates debate such issues. You need to come out your cacoons and realise that these guys have come back to control us ecomically and they want to completely take over the running of our economies indirectly. Our freedom fighters warned us that even if we are independent, these guys will come after us and control us economically, we thought they where joking and now we have brain washed graduates with little minds who cant think beyond what they have learnt in class. If China listened to these guys, the country was not going to be where it is now. But they decided to take their own root of stealing technology and making their economies strong. The west is even Jealous.But you Africans will die with your PHDs.You are just good at condeming.
THANK YOU!!!
As a Zambian, I am afraid that Mr. Sata has problems or has created them. You’ve got take it slow. This can lead to more poverty, than what zambia already has. The unemployment rate will rise and people won’t get more money in their pockets, but will get nothing at all, as many people will lose their jobs. Change your attitude Mr. Sata, or else we’ll be in problems.
This is and shall remain my social justice credo: I believe in human dignity, prosperity as the source of national progress against the tyranny of vacuous rhetoric, fear mongering, non-visionary, antiquated reversal circus politics of doom and hunger by those who lied through to the frontier they have lamentably failed except brewing a catastrophic crisis in absence of democratically patriotic intervention.Here we see that their own future, their boat’s future, and our country’s future is exponentially getting brick by brick into doom.
bottom line what is the general out look for the ordinary Zambian? H as employement levels gone down or up? has revenue collection gone up or down? how is tax payers money being used? for me i think thats what matters most. For now if it means we are downgraded in order to up root corruption and wise use of taxpayers money then i dont care about the ratings
Kwekwe,
While your analysis is correct in that sub-sahara Africa receives negligible investment in manufacturing,you should also remember that PF GRZ is trying to get a $700 million bond,right now Zambia’s 20 years treasury bills (ie 20yrs interest on public debt) is about 20%!!! Compare that to Germany’s 2.25% rate!!
Due to that high rate,Zambia will struggle to repay its debts with a 20% interest rate coz its GDP can’t grow at 20% annual rate while Germany’s economy can grow at 3% to offset the borrowing costs!! That’s why UK,US,Japan,France etc are able to fund their govts,debts have to be sustainable otherwise we’ll see many Greek tragedies
Kwekwe,
While your analysis is correct in that sub-sahara Africa receives negligible investment in manufacturing,you should also remember that PF GRZ is trying to get a $700 million bond,right now Zambia’s 20 years treasury bills (ie 20yrs interest on public debt) is about 20%!!! Compare that to Germany’s 2.25% rate!!costs!!
Due to the high rate,Zambia will struggle to repay its debts coz it can’t have a 20% GDP annual increase while Germany can grow its economy by 3% to offset the borrowing costs
During MMD tenure, these guys where showering you praises that our economy was doing fine, but no medicines in hospitals and poverty levels still very high. Why didn’ tyou question the meaning good economic performance but high poverty levels. PF warn with a landslide victory because people where suffering, if the ratings of your colonialists was in line with peoples standard of leaving, MMD should have been in power even now. These rating are not factual and are only meant to study your economic environment in order to milk you of your much needed resources. If you dont create a good environment for them, they down grade you.Simple
#86 KweKwe,
Do not underate the educated they think before they speak, the only problem I find is that not many understand them.
The educated respect the ratings, but the other group does not respect these ratings.
You see, I am still trying to trace and then follow your logic when you say that these guys have come back to control us – are you basing on the fact that they have given a rating on Zambia??
I dont see how you connect economic performance ratings to ‘coming back to control us’; that is the logic am trying to trace in your submission.
Are you not aware that they rate all countries in the world including theirs? So now are you saying that they are trying to use the ratings to control all countries including their’s?
How I wish I could follow you clearly. Help!!!
Kwekwe,
You are confusing private enterprise and govt expenditure:
seasoned investors consult rating agencies and do their own research before investing their own money. In other words;I,you or anyone else can use this report to evaluate the benefits & cons of opening a factory or shop in zed.
Govt expenditure is how the govt decides to spend its revenues,ththerefore the lack of drugs in hospitals and chairs in classrooms or inadequate social protection is the govt’s fault,NOT investors or the rating agencies!!!
Western countries will always look for faults even when they know that its something good. The world bank and IMF advised Zambia to sell the mines saying copper prices will not rise for a very long time may be 50 years. When they rose before 20 years they said we might not have calculated well. So whether B rating or D rating we know the country is in good hands and the government has made right decisions. I will continue enjoying my sleep and not be worrying about anything. Just looking forward to double economic growth and looking forward again to when these western chaps to say they miscalculated. when they see the good results that will come out of the decisions they seem to condemn or have in question.
# 94 Sholarstic,
You say, “..we know the country is in good hands and the government has made right decisions. I will continue enjoying my sleep and not be worrying about anything..”
How can you say, “we know the government has made right decisions..” When they themselves keep reversing them everyday??
You may be the only one in the country who thinks the government has made right decisions, because even the government itself does hold that view; that is why they keep reversing the decisions because they believe they are making wrong decisions!!!!
Again I must say Scholastic has beaten me in his logic here!!!!
Ratings Agencies are like Newspaper/ Magazine Food critics, they will come to your restaurant observe, eat and go back to the office and write their articles in their columns….its up to you; either ignore them or heed to their advice… either way your business can still succeed. Its also important to note though the readership of that paper if you want to attract that type of clientèle. Its over to you Sata & Co.
Standard & Poor’s should also post their results any time now!!
Well, if you have a president whose nearest comparable to an economy is shatini Nabwalya, what do you expect your economy be be, junk! That is why some people are butting out of this Satanic circus of yours because it is going nowhere but under!
kwekwe you surprise me. so you would rather we either don’t have statistics or have statistic but which show negative performance? the same yardstick is used for all nations to measure economic performance. we now know EU is not growing the economy by using the same yardstick. how else can we measure performance. i will tell you now that negative economic growth in zambia will lead to job losses.
i will tell you that if you had 2million US dollars you kwekwe will not invest it in zambia. before it represents a poor long term investment stability you will instead go to SA,UK, America etc
Fitch can go to hell with their stupid ratings, we are not blind the investments in mining do not even benefit the local populace
SENIOR CITIZEN, you and your MMD are like eunuchs in a harem: you know how its done, you’ve seen it done everyday but you were unable to do it yourselves.
I still wonder why Sata became president. The man totally has no intellectual gravitas to become a president in the 21st Century. I know Chiluba wiped out everyone who looked like a future president (i.e., Nkumbula, Penza, Mwanawasa, Mungomba, Tembo etc), but the least thing that this country needed was a president Sata. Admittedly, the man means well for the country, but it is increasingly becoming clear the man has no intellectual capacity to be president, let alone in a world that extols technocracy. What makes this presidency even more capricious is the fact that it is surrounded by mentally crippled sycophants. Zambians need to reclaim their country.
KweKwe am sure you are intellectually challenged…. if you can not understand first year undergraduate economics…
Its with people like you that Africa finds its self a bucket… People who are educated and yet Foolish
KweKwe’s reasoning is by far better than your narrow mindedness.I have read some of you narrow views and I have read his.
#96 wise people ,i admire a person who concedes defeat. The current government has not re-reversed the sell of Zamtel neither have they reversed the sell of Zanaco though they have questioned how ZANACO was privatised. You are right when you say they have made a number of changes in some of their decisions finding better solutions to benefit the people in the country and in the diaspora .
@102 the Engineer
I agree with you, I think I have a problem especially with the west and their policies they impose on African Countries such as structural adjustment Programme (SAP): I hated that programme because I and my Family suffered for two years without any salary increment hoping that things will improve for better. But where are we?It was a complete failure. While we where experiencing the so called Economic Crunch, some companies in Zambia such as Starnchart recorded huge profits that year. Mine owners where alarmed and some of them closed the mines only to come back begging after realizing that those who remained where still running profitably. Do you know that the crunch was just created by tycoons in USA?
#Kwekwe
The SAPs triggered the anti-globalization movement which culminated into the infamous Seattle riots in 1999. Economics thinkers like Joseph Stiglitz were very critical about SAPs. The IMF eventually yielded to pressure and replaced programs with more acceptable structural reform programs. So that has nothing to do with Zambia being downgraded. My point is you can’t be cynical about credit ratings. It is a yardstick to predict the future behavior of a country. Remember even at a personal level you have a credit score in the U.S.
If PF is honest about them not trying to introduce abominations in Zambia then this is a trial and they should look to God for wisdom to implement good policies but if they are not honest and still want to deceive Zambians by trying to introduce abominations, this is the beginning of their downfall and judgement. May the Lord take care of all Zambians and upright and righteous political parties and leaders.
Sata, enough is enough, we are tired now. Bring developmental projects and stop politicking!
Chikwanda as quoted in the POST has said this is because Fitch are ‘corrupt’. Its the most laughable statement i have read today………….
Gentlemen lets be sincere,imagine had MMD continued ruling,stealing would have been legalised in broadday light. Katele Kalumba is not foolish to comment on how bad the system was.As this is not enough,RBs’ sons were all going to be in a shadow cabinet.
I voted for Sata so that I runaway from all that mmd stood for but unfortunately I am seeing a lot of mmd in what pf is doing and i am really crying foul. I mean look at the Zamtel board; I am seeing Dora all over it, if not worse. Look at State house renovations, diplomatic appointments, Guy Scott’s dummy appointment; etc
There is an apparent lack of cohesion & consistency in the current govt. reflected in the reversal of appointments, contradictions among ministers over issues such as printing of illegal money, Vice President’s failure to answer policy questions in Parliament, & shifts in position over critical issues such as BA64 agreement. It is not only ratings agencies that have become jittery, but even we the citizens. However, the plus with this PF govt. is the will to serve the people, improve their standard of living & reduce corruption. PF just needs to understand & implement the concept of collective responsibility.
Why not? Sata’s govt is headed to failing crop, economic growth is stagnant, copper prices set to tumble with slow growth in China, diminishing investmt/cashflow from lack of marketing, increased spending on non revenue ventures like redistricting, election petitions, commissions of inquiries on the upswing. The UN /fitch being against Sata’s govt claims are plain outrageous, the US dropped in credit rating as well, but, getting bck in business . Ours is a cash economy with very high interest for borrowing. Credit availability is the barometer of any successful economy, but, unfortunately most Zambians been brainwashed with Zambianisation/satanomics. The majority don’t know about individual low cost credit is how u buy shares in companies & become real owners not GRZ/90 days.
It is funny that you all are writing that the white man’s rating is s-t-u-p-i-d; f-o-o-l-s if the white man downgrades the country it means everything will become more expensive and people suffer because borrowing becomes more costly. You all don’t get it; the white man can bring this country to its knees at will. Besides all of you talking smut are living in the white man’s country… leave and go back home and help your country if you know so much about everything…
Sata best be careful they don’t turn this place into another Zimbabwe.
You already know therefore significantly in terms of this subject, produced me personally imagine it from numerous varied angles. Its like women and men are not fascinated except it’s one thing to do with Lady gaga! Your own stuffs nice. All the time deal with it up!