Former Bank of Zambia Governor Caleb Fundanga has warned against a return to foreign exchange controls in Zambia.
Commenting on the Bank of Zambia Amendment Bill of 2013 which seeks to strengthen monitoring of foreign exchange flows in and around the Zambian economy, Dr. Fundanga said there is need to trade cautiously over the matter.
He said the initiators of the Amendment Bill should realize that the need for stricter regulation should not amount to controls.
“I have not thoroughly read through it but I believe the spirit of the bill is to regulate the flow of forex but one thing we need to realize is that returning this economy to forex controls would cripple the economy,” Dr. Fundanga said.
Dr. Fundanga: “If there is need to strengthen regulation, I believe we should instead strengthen existing institutions such as the ZRA.
We don’t need new instruments to monitor forex because the cost of regulation will ultimately add to the cost of doing business.”
He said the Zambian economy needs a stable and business friendly environment in order to continue posting positive growth.
Fundanga tell them! these monkey minded PF govt! they know nothing about sound economic management
Ndobo You are already high, he’s giving very good advice, you are screaming already, this is the news we should be welcoming because at the end of the day, we could serve the economy, you start laughing at the government, his intentions and understanding are totally different from yours, this is how people work in normal environment, different men and women with different skills contributing positively and advising each other, they dont laugh at each other, you may be skilled in a different field and lack in another which someone else is skilled in, but that dont mean that you are damn or not educated enough! Be wise man.
No need for profanity, Fundanga is providing solutions and he is part of the solution unlike some chaps who just criticise for the sake of it…you are welcome to be part of the panel Fundanga…
Ndobo waliba dull. Ukaye ku sukulu.
Fundanga is giving his advice to the government and we need such men in our country.
That is what debate is about in a free society. people learn from each other.
The elephant in the room is that investor confidence is low on account of the poor policy coordination, hence the outflows. Introducing Forex controls at the expense of increased business engagement and better policy coordination only gives credence to the idea that the current administration is failing to maintain a stable macroeconomic environment.
Clearly PF think they can reinvent UNIP and succeed with UNIPIST failed policies. Already queues for mealie meal – Wina azalila.
PF have simple reasoning. They cant think outside box, for them solutions are about statutory instruments and reviews, reshuffling, reversing. If rules are not adequately enforced does not mean you need new ones.
if large economies like South Africa, have some kind of controls, Zambia also need some form of controls without which make Zambia a hotspot for money laundering resulting in Zambia forex growing neighbouring countries economies.
Key points of exchange control
regulations in South Africa as applicable to all transactions no matter the size No resident may effect a transfer without
prior approval No company or legal entity may effect a
transfer without prior approval Only authorised dealers are allowed to
effect a currency transfer Outward payments may only be made for
permissible reasons and under conditions
that are approved by the authorised
dealers on behalf of the Reserve Bank All payments made to foreign parties must
be reported to the Reserve Bank There are set…
Controlling illegal activity is completely different from rationing access to foreign exchange. If you limit access for forex it will spell absolute disaster to the Zambian economy, and even make illegal activity more difficult to control since people will switch to the black market.
Better would be for you (and PF) to learn something about how economies work before yapping about things you don’t understand. To start, simply ask your father (or grandfather?) how things were under UNIP for a quick lesson on what to avoid.
Forex controls should not be introduced at the whims of politicians whose interest is myopic for political expediency. It will be very unfortunate to politicise the value of the kwacha simply to gain votes because the the economy will suffer in the long run.
sounds Greek… can’t get a thing!!! just hoping that there’s a lot of substance in what he’s saying for ’em PF guys to review.
I think Fundanga must also look at the positive side of these controls, ZRA cannot do much when it comes to huge transactions which in most cases are proceeds of crime to some degree, if controls are put in place it will reduce activities of money laundering and the like, take for instance every transaction is monitored by the financial providers on behalf of BOZ which means other countries wont be benefiting when business is actually conducted in Zed, the way things are right now it gives a lot loopholes which need to be addressed.
Let the Balance be struck
Why cant Fundanga read the bill before yapping
I was wondering the same thing. the bill isn’t even five pages long but nobody seems to care to read it. they all want to yap from a hearsay point of view..
Problem in Zed these days is that people just yap and yap without analysing issues. If South Africa has similar exchange controls what more Zambia mwebantu sure. There is absolutely no problem to monitor forex transactions.
If you want Zambia to do everything as in South Africa, I suppose you must also be in favor of legalizing homosexuality?
@Fool me once, do you see ‘Doctor’ in front of the name?, he knows what he is talking about. Just go and sit in a corner somewhere!
@ Shortcake, I’m on the same side with the Doc – forex controls would be terrible for Zambia. Besides, I’m one too.
Relax.
Forex control is barbaric and stone age. Fundanga knows what he is talking about and our situation should not be equated to a South African situation. Thus being simplisitic
Fundanga whom are you lecturing, the guys at Bank of Zambia are more educated than you, please shut your big mouth. You no longer credible, your master has been charged and his immunity removed wait for your time. Our gallant Officers will soon visit you. So meanwhile just shut up. No one is interested in your lecture, we have credible men and women at the Bank who have interest for the people.
The guys at Bank of Zambia are more educated than Fundanga? Really? Can you elaborate, please?
Bembas your time will also come for you to be visited by the law. You are plunderers and thieves.
Dr Caleb Fundanga has a Doctorate in Economics. He was a Senior Lecturer at UNZA. He was also a Permanent Secretary at the Ministry of Finance. He then left to go and work at the African Development Bank. He came back home when he was appointed Governor of Bank of Zambia. Honestly is this a man whose credentials you can question? Besides he’s far more qualified than the lawyer and psychologist who are the current BOZ Governor and Deputy appointed by Sata for the sole reason that they are from Northern /Muchinga Provinces!
these fools you call credible men with drive the dollar to 6,300 in 9 months according to barclays report if this is credibility then we are in trouble
Zambia’s economy needs prudent political leaders, not people of SATA type.Sata will sink our country into economic woes due to his poor leadership vision. The corruption which Sata tolerates is seriously damaging on our economy. Sata has employed his entire Bemba clan and is therefore draining our national coffers for NO JOB DONE. Sata and PF are failures.
It would have been better for Dr Caleb, to read the bill fully before comenting, like what one blogger indicated?. So I may ask the question Why panic like RB who rushed to coart to put an injuction before he could be tried, whose interest is Caleb serving?. In South Africa, they guys have put very stick monetary policies where money earned in SA you can send to out of SA, what are we seing in Zed, ??? common,….I am not an economist but I beleieve BOZ has people who are capable. Dr. Caleb, just rest and enjoy your fat Kwacha Rebase.
those capable fuls are eroding the value of the currency from 4750 when caleb was to 5450 now calling this capable suggest chainama has a lot of work to do
Fundanga: talalafye iwe. You are but a spent force. Oh, maybe you can find a teaching job at one of the varsities. To avoid hypertension, et.cetra, from the frustration and disappointment arising from the electoral loss of spouse in Chilubi.
you people are u patriotic
u oppose trading in kwacha as legal tender and when u fly to soth africa ,tanzania etc u dont trade in the dollar or kwacha and there is some measure of sanity in those economies
all our dollars dont come back they are developing other countries -shallow economic thought
Fundanga how did yo economic acumen reduce poverty in zambia -nil
How can u run an economy when you cant even control money being made from your resources?its economic suicide those who want to keep our money in other countries go back home and leave our resources alone
Commenting on something you have not read is not the best way to go about it. He sounds like a politician instead of former bank governor. Rushing to the media and making comments when you have no facts makes people question your judgements.
What is it about this govt that they want to control everything?
Anything you forcibly control creates adaptable loopholes. The more you regulate it the more it becomes vulnerable. Its also a breeding ground for corruption and all these efforts ultimately cost more money, the very money you are trying to desperately save. You then begin to create a tornado which sucks at the centre, whose effects will be actually out of control. A real vicious cycle! Its detrimental and not worthy it.
I have read the full bill and agree with Fundanga and most other comments against the bill. Unless Zambia does not need FDI anymore, such an amendment will hurt the flow of FDI. When you read the SI on zero rating of exports only if money is deposited in a Zambian account, you wonder why the BOZ should push for monitoring and regulation. South Africa, strong as the economy is, has suffered reduced FDI coz of the same law. The difference is that RSA has sufficient local capacity to develop while Zambia desperately needs FDI. What is most worrisome is the credibility of the persons seeking such wide power as held in the bill. They can abuse the bilk to settle scores.
They can abuse the law; I meant to state.
am surprised that the former says he not ready the document yet is making a comment on it. Is it that dangerous! Lets ask our ourselves how much benefits has FDI brought to Zambia. Lets strick a balance.
Indeed by tightening flow of Forex will ultimately cost small businesses, largely scare potential investors. By so doing, BOZ will monopolize the economy and commercial banks will loose more thus weakening their business activities