Dr Musokotwane, who was a minister in the Rupiah Banda-Cabinet, noted that the current country’s economic situation has left government with no option but to borrow from the global organisation to restore sanity in the financial market.
Zambia is currently grappling with various economic challenges which have seen the country’s fiscal deficit rising, foreign-exchange reserves declining, and economic growth falling to the near lowest since 1998.
This has forced the government to seek IMF financial support of up to the maximum of US $1.6 billion in form of loan.
There have been, however, concerns that the conditions of the IMF cause a lot of harm to ordinary people in short term before improving the situation in the long run.
But Dr Musokotwane said that there were no conditions that would be too difficult for the country to meet.
The economist-cum-politician said in an interview that the country’s finances were overstretched and could not stand without the help of such organisations like the IMF.
Dr Musokotwane is also United Party for National Development (UPND) Liuwa Member of Parliament.
“The country’s finances are difficult; difficult in the sense that we have two big debts that are coming in the next four years – those Eurobonds. We need to get prepared in terms of paying off those debts.
“I don’t see the ability of the country now to pay off those debts because they are supposed to be paid in bullet form, meaning that in one goal we need to pay off everything,” he said.
He said that the only way Zambia could afford to pay back the loans under the Eurobonds was to have a vibrant economic programme which would build its capacity in the next four years.
Dr Musokotwane said apart from the IMF, it is difficult for the country to find a credible lender because the country’s finances need bailout due to government’s overspending and the rising debt.
He called for reduced unnecessary expenditure by the government to ensure that it was able to borrow without facing stringent conditions from lenders.
He simply saying under the current situation no other lender can feel pity for Zambia except the IMF, but with the bad human rights record, Kaya!
The worsted Euro bonds. So painful!!
Lungu needs to explain the economic benefit that has come out from the borrowed Eurobonds other than corruption and massive looting by his PF thugs and criminals
Zambia is losing money through trade and corporate tax… Zambians are being robbed:
On the main road to the home of Zambia Sugar Plc, a large sign advises visitors: “Welcome to Mazabuka – 4km to the sweetest town in Zambia.”
Lying around 100km south-west of Zambia’s capital, Lusaka, the town has been described by the chief executive of Zambia Sugar’s parent company as an island of “relative prosperity” in a country where malnutrition and poverty are still rife.
George Weston, 48, who earns £918,000 a year plus an annual bonus of £864,000 leading Associated British Foods, is right. Jobs created by Zambia Sugar in and around its Nakambala Sugar plantation in the Mazabuka district are vital to local livelihoods.
And it is a growing business, an important part of the…
Read article by ActionAid on Zambia sugar, just one cash crop Zambia exports:
The Associated British Foods group (ABF), owner of Silver Spoon sugar, is avoiding tax in Zambia, one of the world’s poorest countries. Our new report, Sweet Nothings, shows that since 2007 Zambia Sugar has generated profits of $123 million, but admits paying “virtually no corporate tax” in Zambia, taken over US$83.7 million (US$13 million a year) – a third of pre-tax profits – out of Zambia into and via tax havens including Ireland, Mauritius and the Netherlands, deprived Zambian public services of an estimated US$27 million as a result of the company’s tax avoidance schemes and special tax breaks.
Why is ZAMBIA BEGGING FOR MONEY? WHY IS ZAMBIA STILL POOR?
Ati the “economist-cum-politician”. Honestly, what kind of rubbish is this. Now get your dirty mind out of the gutter.
You always cry for solutions, someone offers free advise, wayamba kushupula mashupu.
Let’s leave it to experts like Mr Musokotwane afterall he’s been government minister.
@At masterP, lovely human what the former minister is saying is true unless you don’t know much about the current financial standout of our country. We re the same like what Greece was 4 years ago. Worse to it, IMF has attached another condition pertaining the release of HH b4 Granting of this bailout loan. Mutati knows this.
These were Finance Ministers not the accountant currently in the ministry.
@Desmond I wouldn’t tie HH ‘s issue to the conditions. Egypt has just been given billions inspite of detaining hundreds of opponents without trial. At least HH is appearing in court and his lawyers are able to determine the direction of his cases. How do you release an accused who is appearing in court? And how does he clear his name if the case outcome hasn’t been determined by the courts? Just deal with the issue at hand. I only hope you’ve also stopped eating until HH is released?
Its is interesting that the Doc has not said anything concerning the home grown initiative or miracle whatever you want to call it. It is a paradox that you borrow such colossal amounts when you don’t have a plan of how you are going to pay back the money. And now that its 4 years before repayment, you go to solicit for a maximum debt of 1.6 billion usd and still, you want to use the said amount for unnecessary travels and personal emoluments? When are we going to learn to deal with our own challenges instead of always running to the people who forgave us our debts? With the current economic and political situation in the country, lenders have grown cold feet because their money is not safe were there is no transparency and checks and balances .ie opposition.
This is unnecessary debate becoz Lungu’s actions and IMF Conditionality don’t tally. With a Poor Governance record, Gross Human Rights Violations and lack of Respect for the Rule of Law the IMF Board will not approve the proposed loan amounting to USD 1.6 Billion to the Lungu Regime. Mutati should just forget IMF Money with HH in Prison slapped with trumped up Treason charges. Instead Mutati and Lungu should brace up for Sanctions from the International Community for the current misrule. Where is AU and SADC while Zambia is on fire.
The international community can and will never sanction zambia for the sake of HH, The IMF too cannot and can never put the release of HH as one of the conditions to loan zambia the money they intend to. HH has a case to answer and is been tried in the court according to the law of the land. Do you think the IMF have a problem with that? The answer is no, thats wishful thinking. Don’t dream too much. By the way Hon HH is not guilty until proven so.
I agree. Zambia is busy overspeading on police and army so they do not force Lungu out of office.
Where are Zambian learned bankers and finance graduates?
The Associated British Foods group (ABF), owner of Silver Spoon sugar, is avoiding tax in Zambia, one of the world’s poorest countries. Our new report, Sweet Nothings, shows that since 2007 Zambia Sugar has generated profits of $123 million, but admits paying “virtually no corporate tax” in Zambia, taken over US$83.7 million (US$13 million a year) – a third of pre-tax profits – out of Zambia into and via tax havens including Ireland, Mauritius and the Netherlands, deprived Zambian public services of an estimated US$27 million as a result of the company’s tax avoidance schemes and special tax breaks.
Where did these people take all the billions they’ve borrowed in the last two years?
They have bought property abroad
The bailout figure keeps growing by the day 1.1 billion mid last year to 1.6 billion this year. Might end up being 2 billion by the end of the year
Musokotwane’s children live in London and are currently selling land to Zambians abroad; they have a website where they advertise land and the scheme looks a bite far fetched
ABOUT THE EURO BOND, I CAN DEFEND THE PRESIDENT, HE WAS NOT PART OF IT. ASK CHKWANDA & MILES, THEY KNOW BETTER
Euro bond was shared between the dead and living Zambians.
Take a leaf from the late Mwanawasa.He appointed highly qualified and experienced people in strategic institutions such as ZRA,Bank of Zambia,ZESCO and Finance Ministry. These people helped him revive the economy, debts were written off and the dollar came down. International products became cheap, cost of production became low. It was simply wonderful. Now we are back to square one. Oh, cry my beloved country!
Remember that it was Minister Situmbeko Musokotwane who opposed the Windfall Tax. The debt that they just need to go to the IMF for, was largely made up of the multiple billion dollar Eurobonds. Zambia’s debt would be billions of dollars lower, if the Windfall Tax had been introduced and collected. He is just singing his Rothschild baron masters voice – after all the controllers of the IMF, owners of Anglo-American De Beers and Rio Tinto, were also the inventors of the Eurobonds…
Then Minister Situmbeko Musokotwane, patronizing the supporters of the Windfall Tax – which had no repayments or interest payments attached to it, and therefore would not have led to inflation of the Kwacha – if anything it would have led to deflation – your money would have bought more, rather than less.
I see this criticism everyday from accountants each time a fellow accountant presents a financial report for a club etc. Put them there, you don’t see anything different. It’s inborn in we Zambians to criticise even when there’s no reason to. At my church our Treasurer is a school teacher and his job is to record receipts and expenditures in a transparent manner, but you’ll find this accountant bringing in all sorts of unnecessary terminology just because he wants that job. We’re happy with the current setup because business is conducted honestly and our auditors have no misgivings.
Zambians are being cheated of their worth and are being told the country is broke and Zambia is poor. Read this article by a none Zambian:
The Associated British Foods group (ABF), owner of Silver Spoon sugar, is avoiding tax in Zambia, one of the world’s poorest countries. Our new report, Sweet Nothings, shows that since 2007 Zambia Sugar has generated profits of $123 million, but admits paying “virtually no corporate tax” in Zambia, taken over US$83.7 million (US$13 million a year) – a third of pre-tax profits – out of Zambia into and via tax havens including Ireland, Mauritius and the Netherlands, deprived Zambian public services of an estimated US$27 million as a result of the company’s tax avoidance schemes and special tax breaks.
Read the full article on google by ActionAid…
The IMF Board is dominated by Western Govts Shareholders who believes in Constitutional Democracy, Rule of Law, Good Governance and Respect for Human Rights. These attributes are currently absent in Zambia under the illegitimate Lungu Regime. Lungu made a mistake to lambast the USA and EU who control the IMF Board. Good Governance and violations of Human Rights are important conditions for IMF Lending. With the Leader of the Opposition in jail on trumped up charges its very unlikely that Lungu will receive USD 1.6 Billion which he can use to Brutalise the Opposition and all those who don’t agree with Lungu’s views and don’t approve of his misrule. Lungu should just forget about Western Aid given his Dictatorship.
Mr Musokotwane, be careful with what you “are welcoming”!! Your party leader is in detention over trumped up charges but you appear to want to be cleverer and start welcoming things you don’t really understand – how more inappropriate would that be if NOT near to treachery?
I don’t need to educate you about African politics because it is deadly!! Why don’t you just come out and join PF to get a job from Rupiah and Lungu? Of course every idi.ot including Lungu knows that…”the country’s finances are overstretched” and the economy is going nowhere!! But WHY? This PF Govt borrowed more US$6.5 billion over the last 6 years and virtually stole all the money? It is your job to get PF account for that money before they embark on another borrowing spree BUT you are not doing the job…
Cont….
BUT you are not doing the job well and you are in fact encouraging PF to be borrowing even more – so illogical!! It the same as selling more beer to someone who is already drunk. I am so disappointed with you really – you are educated but not clever. If that borrowing goes through, Zambia will have a Debt burden of 65% of its GDP – that is what you are welcoming and it is stu.pid!! You studied your economics too long ago and your knowledge is surely outdated!!
@ Chilyata. Your attacks are equally misguided. wherever you are blogging from, certainly not everyone from your village or family are with you. These and many other people are the ones suffering due to an economy that is passive and requiring revitalization. Fine. You call the former Minster stupid with outdated knowledge. What is the solution that you are offering yourself? None. You are there in the diaspora trying to survive and rebuke people that are trying their best to address economic difficulties. I’m sure if you had established economic and financial means you could have decided to bring a factory to create employment in your country and Africa, but unfortunately you are a pure salaried worker. For that keep your comments to your small mind.