In this audio, National Development Planning Minister Lucky Mulusa says Zambia does not need the International Monetary Fund (IMF) $1.3 billion bailout package.
And Mulusa says Zambians must be patriotic and avoid posting negative things about government on the internet as it can damage the investor’s perception on the country.
Speaking at a PF Interactive Forum today, Mulusa said Zambia’s economy had survived the worst down turn and it would survive without the IMF’s aid.
“I will tell you this and tell you now that our worst time was between mid 2015 and mid 2016 just before the elections. That’s when the economic downturn had reached the bottom and during that time, we never ever defaulted on any of our international obligations, we never defaulted. Now the economy is picking up as a result of economic activities picking up in China and China is demanding more of our copper so we are able to export more copper and more revenues through taxes from that copper exports and also bringing in more hard currency in terms of also managing our exchange rate. What this means is that we can do away with the IMF and our economy will still be vibrant so people must not have this perception that maybe Zambia’s economy has gone berserk and we need bailout from the IMF, no. it is merely investment in perception in order to trifle down the interest costs that we are paying because the investors will be very comfortable with us engaging with the IMF,” Mulusa said.
Asked what measures government had put in place to ensure that it did not default on loan obligations, Mulusa said government had restructured infrastructure roll outs to make them more efficient.
“What we have done is that we have introduced efficiencies in the way we do things. We have decided to restructure the infrastructure roll out so that we start with those economically viable projects which can promote inefficiencies in our economy. So we are not undertaking so many projects because that puts pressure and also results in a thin spread out of resources. And also, you tend to be guilty of having an overlay of domestic capacity to undertake development. So we are doing what we can afford to do at that particular point in time and we are trying to finish projects as quickly as possible so that when we come to 2022, at the time that we will make the first payment for the first bond, the $750 million bond, this economy will be able to do that,” he said.
“So in short, we have induced fiscal discipline, if you have noticed, even in terms of spending on government officials, ministers previously used to have two vehicles, there was the utility vehicle and the personal to holder vehicle, we have done away with the utility vehicle, all those are huge savings. The other efficiencies that we are doing, if you recall, when we were launching our site, the PS indicated that we are doing away with paper pay slips and that we are going to save $8 million per annum as a result of getting rid of paper pay slips and going electronic, there are a lot of things that we are doing to reduce on the costs and to just make sure that we create that fiscal space to be able to meet our obligations.”
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And Mulusa urged Zambians to be patriotic in order to secure investments.
“Now let me come to the lack of patriotism that seems to be crystallizing in our country. You see, those people feel that they want to come to power, and they want to come to power by way of smear campaign and by way of engaging in unnecessary smear activities, they are merely destroying the country. The postings on social media, the postings on other platforms such as Bloomberg, these platforms are visited by investors so the investors start perceiving us driven by what Zambians are posting about their own country,” said Mulusa.
“So, you can imagine, if you borrow $1 billion and you are going to pay 10 per cent and your interest rate should actually be two per cent but the eight per cent has been caused by Zambians posting, Zambians engaging in activities, that eight per cent is the unnecessary cost that Zambians are paying as a result of not our inability to manage the economy properly, but as a result of Zambians’ campaign against their own country.”
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