Financial Economist Bright Chizonde has said that the government should heed to the International Monetary fund (IMF) call for governments to subsidize the cost of food and energy for the poorest members of society.
IMF Managing Director Kristalina Georgieva recently said governments need to subsidize the poorest citizens in a targeted manner, preferably through direct subsidies to individuals as people are struggling with the rising cost of living.
In an interview with the local radio station Phoenix News, Mr. Chizonde said that people need help as the country’s economy is still recovering from hardships which have subjected them to further suffering.
Mr Chizonde has however cautioned against wrong targeting of the subsidies adding that the government should ensure sectors that add to the wellbeing of the people are targeted.
Last week, the head of IMF told the BBC that governments need to subsidise the cost of food and energy for the poorest members of society, adding that people around the world are struggling with the rising cost of living.
Kristalina Georgieva said support needed to be provided “in a very targeted manner, preferably by providing subsidies directly to people”.
According to the BBC, many governments are providing some help but critics argue it’s not enough and when it comes to the cost of living crisis, Ms Georgieva said: “There are two priorities, one the very poor people, segments of society that are now struggling with high food and energy prices”.
The second, she added, is to support those businesses that have been “most damaged” by the war in Ukraine.
Ms Georgieva is concerned that without the correct government support the protests seen in Sri Lanka could be repeated in other countries.
Sri Lanka’s economic crisis, exacerbated by rising prices, has led to deadly riots, a new prime minister and a first-ever default on its debts.
The IMF boss said such similar unrest before the pandemic, from France to Chile, was caused by “a sense of inequality growing” and decisions being made without the support of the people.
“If we are to learn any lessons from 2019 if is to be much more humble about policy decisions, and engage in multiple ways with people, because policies must be for people, not the paper we write them on,” she said.
So what are they waiting for?
OK. Good. But what is in this for the IMF? Is it a moment of lucid contemplation for all that they have advised wrong?
Is it not the same IMF which asked Hakainde to remove subsidise. Today it is advising the same government.
Context Ba Lusaka Times. The IMF is right to advise countries with the capacity to subsidise , not highly indebted countries like Zambia. The UK has just unveiled a package to help poor households because they still have heard room to do so.
#4 Musa… I am sure you are right. IMF can’t give you money for subsidizing consumption.
Its okay for IMF to advise countries with the capacity to subsidize, the least Zambia can do is TARGETED SUBSIDIES to those in need.
The subsidies that HH government cancelled, were subsiding even for the middle class and the rich people. Zambia could not afford that, it’s a task for GRZ to identify ONLY those in dear need.
THIS SHOULD NOT BE UNDERSTOOD AS SUBSIDY FOR ALL !!
@Henry, my friend, you will NOT qualify for the targeted subsidie.
We do not say, ‘government should heed to the International Monetary fund (IMF)’ because ‘heed’ already has ‘to’ built in it when used as a verb. So we say, ‘government should heed the International Monetary fund (IMF).’
Do you need IMF to order you to subsidize food? The imf is always anti subsidy so what’s happening here? Someone is trying to manipulate us. The story will unfold only with good journalism
Criminals and crooks are back…
Watching from terraces is different from playing the game.
They have to say this to save face. Europe is having a feel of poverty which they inflicted on poorer nations for decades. Most of these governments are now heavily subsidising their nations and blaming everything on the Ukrainian war with Russia. The global recession has been triggered by pure selfishness and greed. Soon our own government will jump on the band wagon to blame a global recession on failings or bad decision making.