PROSPECTIVE investors studying Zambia would be forgiven if they felt they did not have a clear idea about the Southern African country’s economic policies.
Its economy is booming on high demand for commodities — it is a key global player in copper and cobalt production and also gifted with gemstones and gold — and it has a history of political stability mainly cemented during the long rule of the Movement for Multi-Party Democracy (MMD).
But under the government of President Michael Sata and his Patriotic Front, investors have received a mixed bag of practices (and policy). The government has taken back some companies sold to private businesses under the MMD and has appeared to clamp down on foreign investors.
Vice-President Guy Scott has been at pains to explain what is happening. His view is that the government and country are still on a sound footing. Yes, the government has grabbed back some companies previously sold, but that does not represent a policy shift to socialism. Mr Scott says reversal of those sales — including a mobile phone operator to Libyan investors and that of Finance Bank to South Africa’s FirstRand group — was part of the party’s election manifesto. There is no clarity whether the investors kicked out will get any compensation or will be paid back the value of their investments.
[pullquote]Second, no opposition politician needs to earn his stripes by spending nights in jail, especially because of an archaic colonial law on public order[/pullquote]
He argues that the deals were not entirely above board in the first place and added little or no value to Zambia. What Zambia would like to argue is that it is cleaning up business practices and ensuring that the environment guarantees fair play, natural justice and security for investors’ cash.
Harassment of the political opposition is another matter that has vexed investors. An inability to tolerate dissenting views is always a bad sign in democracies and is viewed as anti-business. But Zambia argues it is only holding opposition leaders to account for claims they make and that even Mr Sata, while he was still an opposition leader, spent many nights in police cells as governments investigated his political outbursts. Mr Scott argues that Zambia’s opposition is bent only on soiling the government’s good name.
But any government that wishes to attract investors on a global scale needs clarity around its policies. It needs to explain its decisions to investors and citizens. It cannot arrogantly imagine that these things are clear to everybody. Dr Scott argues that too much is placed on happenings in Zambia mainly by people who do not understand the country or its history. But primarily because this ignorance exists, the government must do substantially more to educate investors about what it is trying to achieve and how it is going about it. This is no time to hide its head in the sand.
Second, no opposition politician needs to earn his stripes by spending nights in jail, especially because of an archaic colonial law on public order. Although Zambia says that the law is under review, it must take active steps to repeal it to convince both citizens and investors that their security is guaranteed fully by the country’s constitution.
Communicating is not as easy as it always appears to be. The government must be as clear as possible about its intentions.
[pullquote]Zambia, or any other country in the region, must strive not to hurt these important strides through poor communication and ambiguity about policies and intentions.[/pullquote]
Stability and growth in Zambia is important to the Southern African Development Community region. It would mean the region is slowly but surely moving towards its target of reducing poverty and improving household incomes.
With recent rapid growth in countries such as Angola and Mozambique, the region cannot be seen to be undermining efforts to tap and utilise foreign direct investment.
Zambia, or any other country in the region, must strive not to hurt these important strides through poor communication and ambiguity about policies and intentions.
[ Business Day is South Africa’s Financial Newspaper]
Well we have been saying this for years now and PF think Zambia is an island. It takes a very very long time to build trust and reputation and it takes just months to destroy it. The great investment atmosphere and trust from investors took MMD 20 years of blood and sweat to build and as MMD we shall not just seat and watch it destroyed.
People forget that we inherited a bankrupt country and indescribable debt and when we left this country, we left it with huge foreign reserves and excellent reputation and we were on the verge of whining it away from World bank. Surely , history will remember us with a smile.
Looks like PF is taking us back
Proud MMD Chief Bootlicker
I agree with you 100%. Its amazing though that the P.F. And its followers are failing to see what this ciuntry has degenerated into in less than 2 years. Is there any hope going forward I wonder!
I finally agree with you but it was good riddance to bad rubbish! My apologies but what can I say!
Ati archaic public order act, monga their forefathers didn’t bring it. Boota**licker, only corrupt intended infestors will be worried. The clean ones are here are making good money.
Forefathers to South Africans? When did South Africans colonize Zambia? So you got your independence just to continue with repressive laws? Typical dimwits!
It is clear that corrupt elements seem to be feeding this business day with alot of lies and distortions. Socialism is practised in the UK, USA and in many other developed countries including China. The hypocricy with the west is that they disguise under various names such as bailout, social security or protection and many others. Neverless its surprising that this editorial fails to acknowledge that the MMD ran a corrupt regime which simply auctioned its national assets for a few pieces of silver. There is no way the sale of Zamtel which was spearheaded by the likes of Henry Banda be said to be a good deal, there is no way the sale of finance bank to FNB can be said to be a good deal. It is time Zambians reject this type of myopic thinking by some editor of this so called business day.
Development Policy under PF is clear and unambiguous. Based on focused application of Good Governance tenets and upholding Rule of Law, peace and stability are visible everywhere. Four examples of accountability involving Zambia Railways, Finance Bank, Zamtel and Maamba Collieries are intended to build sound economic management. Even in the medium and long term, investors will return with a vengeance because good investors only invest in countries where impunity is not tolerated. National leaders must not over speed on our highways. When Police stop and charge national leaders for over speeding, Police is talking to motorists. please stop putting national leaders above the law. Your patriotism is questionable if you think that in Africa opposition leaders are untouchable.
Do you reckon it’s okay to arrest opposition leaders for meeting chiefs – as Nevers and others were arrested for? And do you think it’s okay for the opposition to be stopped from having political rallies – as is happening in Zambia? Do you think opposition leaders are trying to be above the law for protesting against this? Is this part of the good governance you are so proud of? I rest my case.
Mixed grill in your comment…
The article talks about investors but fails to mention a quote from any investor about how they perceive Zambia. The only mantioned investor is Libyan Investor and not that they are disgrantled but in passing over telephone operation. The article is all an opinion and is not backed but substantial data. Therefore, it is an F article which has a comfotable place in the trash can. Zambia is not PF and those who make policies and legistaltion include All MPs. So by being biased, the author is shooting himself in the foot.
This is an opinion not an article. They don’t have to quote anybody. Please read before commenting.
Just an observation. Why do Zambian leaders use oversized Chairs. They look preposterous and completely out of place. The Vip is actually sinking in it. What is wrong with upright normal chairs, “chippendale-style”, Louis VI armchair or a modern wing chair. Ndelanda fye!
Nice one! I think it is a hangover from whence things big were for so-called “big men”. It is small wonder that the brawn is still being picked over the brains, huh?
I hope it works not like what was done. you sales mines at 600, two to three yrs late the chaps over 200 billion, the cost ZESCO is 150 million the investor only pays 50 million. Abash ZESCO tariffs. You should learn to shy. The chaps have become so rich that they even called rich boys from our copper.
I hate when people deliberately support wrongs.
Zambians voted and not PF. How do you convince me that am not or am PF, when you do not have membership cards and even a register. how many are your registered PF members? PF is Zambian, so when we talk we know. I have never heard that there is PF renewal of membership?…..which means you guys can steal and go leaving Mr.Sata and Kabimba along.
What the hell are you on about?
We have a great VP in Scott!!
Namwandule @ 5, your observation is quite correct. It was Chiluba that introduced those “throne-style” chairs into State House; clearly a symbol of a complex of sorts by small men everywhere. You just have to turn to history: Witness Napoleon and Hitler. They all behaved the same way. Somehow the size of the “throne” makes up for what they lack ib both physical presence and stature. KK never had that crap in his State House. And by the way, Chiluba picked Chibwe to buy those chairs from South Africa – Chibwe himself a dimunitive man himself . Go figure!!
We warned you of this clueless chaps and you didn’t listen.PF has no sense of direction,no coherent policies and Sata just wanted the big seat just for the sake of power and fame.Sata still thinks he is in opposition and his instinct is to fight even when there’s no enemy.For the sake of our economy and our reputation Sata has to go.
From this article, you can see Scot was really laboring to churn out a plausible, sensible and intelligent explanation. He’s PF’s laundry man, a janitor that cleans “after you Sir”. And that’s purposely his job via terms of reference by the President. Send him abroad to talk to his kin and kith, he looks and speaks like them, he may convince them. Some politicians who call him ‘styopet’ are berated back home. What a tragedy! This article should send alarm bells to PF and their supporters. But then do alarm bells mean pretty much anything to them? Me I don’t know!
MMD bootlicker,
Giving an investor 10 or 15 years tax free incentives is careless and damaging to the country’s development, it has nothing to do with trust!. We had many so called investors who came and were given the tax free incentives but left immediately the period expired and left many Zambians jobless without even paying them their terminal benefits. These companies made billions of dollars in the country and the only beneficiaries were corrupt politicians like Liato who received kickbacks when Zambian employees complained of bad salaries. As a country we don’t need corrupt investors or those only interested in Zambia because of tax free incentives, the country needs revenue to develop! $2 billion dollars is nothing in 20 years, how many billions has Kansanshi, KCM, MCM made…
Correction: ba business Day the stability was cemented in the Second Republic. Most new nations in africa faced the challenge of being united as ethnic groups saw independence as a chance to break away. ZamBians stayed united. You may not be aware of this since you were under apartheid then which never allowed you to see progress in any black ruled african country.