Dear Ms Kristalina Georgieva, current Managing Director and Chairwoman of the Executive Board of the International Monetary Fund (IMF), positions you have held since October 1, 2019.
Please do forgive my impetuous impudence and near rudeness for sending you this public open letter. You see, the matters I seek your attention and action upon are extremely urgent, and they do not permit me the luxury of a private confidential letter to your high office.
It is, to you admittedly, the small matter of electricity and fuel subsidies, for a small country called Zambia, I write to you about. Your IMF staff have just reached a “Staff Level” agreement with our government officials including our Minister of Finance, a Mr Situmbeko Musokotwane, on “far reaching and ambitious economic reforms” so that Zambia can get onto one of your debt financing programmes. These reforms include of course the removal of government subsidies on electricity and fuels.
My people, the majority of Zambians, have been battered and broken by centuries of slavery, colonialism, capitalism, imperialism, the ignoble One-Party State and a raft of neoliberal policies and programmes from both the World Bank and the IMF, the last two very nefarious organisations you have an excellent knowledge of, you having served both organisations at the highest possible levels.
The majority of my people have not enjoyed the fruits of nature and the products of their labour. Your IMF staff can furnish you the latest details of the fabulous quantities of rich copper, cobalt, zinc, lead, coal, emeralds, gold, silver, uranium, hydropower and many other natural goodies Zambia has.
With the rich world moving towards electric cars and renewable energy, Zambian copper holds the promise of unimaginable wealth to be pocketed by those who will mine it.
Since 1991, Olympic Gold Medal forms and levels of poverty have become the lot of the majority of Zambians, as you very well know. An IMF/World Bank inspired world breaking speed at destroying the nascent national economy Kaunda and his hapless friends started building, adizzyingly kleptocratic cocktail of World Bank, IMF and “donor” economic policy prescriptions, expensive but easy to get loans, a voraciously corrupt and ruthless local criminal political class and a population drunk on colonial Judeo-Christian theology have all combined to produce a population numb with poverty, unemployment and extreme inequalities.
Georgieva, you need to come to Lusaka, the capital city, and come try out “poverty tourism”
in anyone of our slums to fully understand the circumstances I am describing. Should you survive for 4 full days, I am willing to give you half my humble possessions.
The coronavirus pandemic has just been more fuel to this historic inhuman set of circumstances my people find themselves in. Life is tough, it is hell, for the majority of Zambians.
It is in these circumstances, after nearly two decades of waiting to become president of Zambia, that Mr Hakainde Hichilema (HH) and his UPND have finally won a landslide election victory and have formed government. You obviously have heard that they are calling themselves “The New Dawn Government”.
The landslide victory was inevitable given two important facts: the immediate past Zambian president, Mr Edgar Chagwa Lungu and his party, the Patriotic Front (PF), had become notorious for corruption, the erosion of democracy, the destruction of state institutions and the vandalism of government. Increasingly, they became arrogant, authoritarian, violent and quite frankly, open thieves. Meanwhile Zambians were sinking into untold poverty, misery and helplessness.
Hakainde and his group successfully projected themselves as possible good managers of our economy. This, they drummed into our heads, would reduce our suffering once they came to power. In short, they told us they would reduce the cost of living and doing business, and restore our democracy. These now clearly dubious claims were buttressed by the fact that HH is famed to be rich, a self-made rich man. We do not have verifiable proof of this, as his asset and liability declaration filed as part of his nominations for election as president has been coaled; we do not know why.
Among the many promises of good things HH and his friends promised to do for Zambians were reduction in the prices of electricity and fuel, and increasing electricity generation capacity.
No full modern human life is possible without electricity and fuel. All modern domestic and economic processes need electricity as a universal ingredient. A phone, a computer, a fridge, a stove, a microwave, a dishwasher, a shower, a bath, heating homes and budlings all need electricity. All economic activities need electricity.
In this day and age, therefore, every human being must have access to electricity as a universal human right, because social life without it is unbearable, and economic life is impossible without it. Electricity is therefore a strategic political, social and economic asset of any country.
Until non fuel energy becomes dominant, fuel plays more or less the same prominent role in both social and economic life today, as electricity. Countries with low fuel consumption are actually poor and backward. Fuel is not only important for transport; it is also important in the provision of electricity. Fuel is a public good and needs full state subsidies, and other support and regulation to ensure normal human life and general economic activities take place, unimpeded.
We saw recently how the US government offloaded massive amounts of strategic fuel reserves not only to make fuel available, but to directly distort supply in favour of lower prices for its US citizens. Oil producing countries have even formed cartels to control supply and demand of oil, and therefore price, in the global markets.
Electricity and energy/fuel sovereignty are central to political stability and economic development of any country. No country can advance and secure its people from poverty without first also guaranteeing the cheapest and freest possible access to electricity and energy/fuel, in this day and age.
The current prices of electricity and fuel in Zambia are unfordable to the majority of the population. This situation is worse in the rural areas of the country. Removing government subsidies will worsen an already dire and explosive situation.
I write, therefore, to you, as the Managing Director and Chairwoman of the Executive Board of the International Monetary Fund (IMF) to veto the removal of these subsidies as socially, economically and politically suicidal, and therefore not in the interests of both the IMF and Zambia.
Will you do it for our girls and women, during the pandemic, who will suffer the most, should the removal of subsidies remain in place, please?
I trust your instincts honed during the many years you worked on humanitarian aid will aid you in arriving at this most obvious of decisions.
I remain,
Agnes Musonda Munalula.
(If you are equally impetuous, and want to comment on a letter, send your comments to: [email protected])
One Response
Bravo. Consistent arguments. Electricity and fuel should be subsidized as long as necessary to kick start development. Government should first consult widely. Households and companies need affordable energy to perform efficiently. Government should adopt broad tax regime to raise revenue. Deforestation is mainly a result of low electricity access. If domestic market is unprofitable, then power producers can target eastern and southern export markets.