Special Assistant to the President for Press and Public Relations Amos Chanda says if the International Monetary Fund (IMF) takes 50 years to come through with a balance of payment support programme for Zambia, Finance Minister Margaret Mwanakatwe will not wait, but look elsewhere for help, including China.
And Chanda says President Edgar Lungu, who left for China yesterday with a huge government and private sector delegation, will remain in that country until September 7th to enhance economic ties as well as renegotiate Chinese debt, among other activities.
Speaking when he addressed journalists at State House, Chanda said all options to improve Zambia’s debt sustainability were being pursued.
“All options to improve Zambia’s debt sustainability are available. But the trip that the President is undertaking to China today is to increase economic cooperation. If on the mutually-agreed platform, the owners of Chinese debt agree to renegotiate it, that will be done. That is what the Finance Minister is doing – to improve the terms of these loans, probably to improve the tenor or probably increase the repayment period; to probably look at interest as well. But the broader term she is using is debt restructuring. So, what she will be doing is to renegotiate Chinese loan terms, if not on existing debt, then any debt that may come from there,” Chanda responded when asked if Zambia was looking for balance of payment support from China.
“So, she (Finance Minister Margaret Mwanakatwe) has not made a specific request for balance of payment support, but if she finds the financing arrangements in China favourable, she may get because she is looking for any affordable financing from any direction.”
Asked if a balance of payment support deal with China would not jeopardise the on-going negotiations with the IMF, Chanda said Zambia was not going to wait for the IMF to run its economy.
“The Minister of Finance runs the economy on a daily basis, so if the IMF is coming in 50 years, she will not wait, she will go to the market and seek favourable terms to negotiate. The desire to run the economy properly or the austerity measures are not dictated from above, the need to control spending is not a condition from IMF, if it’s a condition it’s coincidental. It is a conscience of the Cabinet to control spending and reduce borrowing and make sure that there is no wastage in spending…if that is done without the IMF programme, so much the better; if the IMF programme works that’s good also,” Chanda responded.
“The IMF representative [who has been withdrawn from Zambia] a diplomat, so whatever has happened is being communicated within the diplomatic channels. What has been stated officially by the Ministry of Finance is that the IMF rep has been withdrawn for redeployment and a new representative will be sent, and the process for the programme is on-going. That is the position of the Minister. In this case, the IMF has withdrawn Dr Baldini and the reasons for the withdrawal would be undiplomatic to communicate in the media. But according to Honourable Mwanakatwe, the IMF are coming for Article 4 consultation any time soon, that tells you that the process is still on.”
Chanda then went ahead to outline President Lungu’s agenda in China.
“The President will this (Thursday) evening travel to China to attend to two major events. There is a bilateral summit between the President of China Mr Xi Jinping and President Lungu on the 1st of September. The two leaders will discuss a broad range of cooperation agreements mainly in the economic sector; but they will also be discussing the long-standing cooperation in the political sphere,’ he explained.
“Then on the 2nd of September, President Lungu will address the China-Zambia Investment and Business Forum, to be hosted by CNMC, the biggest Chinese investor in Zambia who owns Chambishi Metals and other facilities such as the Airport Multi-Facility Economic Zone. The President will deliver a keynote address to those Chinese companies. He will also tour some selected companies.”
He said President Lungu was travelling with an unprecedented private sector delegation.
“On the 3rd and 4th of September, the President will then join 45 other Heads of State from Africa who will be attending the Forum for China and Africa Cooperation, otherwise known as FOCAC. Then on the 5th and 6th , President Lungu will then move to Jiangsu Province to tour some facilities, including some copper processing plants and also to witness the signing of an agreement between the Province of Jiangsu and Muchinga Province of Zambia. They will enter into a specific economic cooperation agreement where there will be technology transfer from China to Muchinga and vice-versa,” narrated Chanda.
“I can add that a sizeable number of private sector people will be travelling alongside the President. I do not know the actual size of the private sector delegation, but what I can confirm is that government is facilitating to ensure that the difficulties that a private sector person may have when going are taken care of, otherwise they are financing themselves. It’s a huge delegation in all fields, mining, fish-farming, manufacturing, tourism, road construction, technology and all other areas where the Chinese private sector is interested in. For diplomatic constraints, I cannot tell you details. I can only confirm that this is a very remarkable tour, probably the biggest tour you have ever seen of any Zambian President when going to China, given the size of the delegation, the number of agreements to be signed and the value of those signatures. I can confirm that it’s not a trip like any other because of its significance.”