Executive Issues - January 2009

8/14/2019 Executive Issues - January 2009

http://slidepdf.com/reader/full/executive-issues-january-2009 1/12Executive Issues

Volume 7 - January 2009

Volume 7 January 2009

Contents

To pg 2

NAPSA Sacks Boss - Page 2

Who’s who - Page 3

Evaluating the Banda Presidency - Page 5

Maize: Export or Perish - Page 6

Budget 2009: Likely More of the Same - Page 7

Zimbabwe: A Wooden Spoon for SADC - Page 8

Energy: A New Idea (At Last) - 0

Orbituaries - Page 11

Zambian Airways Faces Collapse

Chungu’s return raises questions on the taskforce

agenda to ght corruption

Maxwell Nkole, the chairman of the Taskforce on Corruption,was quick to dismiss the assertions that fugitive former intelligence chief Xavier Franklin Chungu alias ‘XF’ hadcut a deal to enable him return home after four years of self-imposed exile. Chungu, who also carries the name of Franklin Kalinga Chungu, returned home on December 3,2008 from his ‘hiding’ base in neighbouring Mozambique (See

Executive Issues July Edition) where he was comfortablyliving on the sea side. It has emerged that Nkole was in theforefront of trying to cut a deal with Chungu and he personallytravelled to Maputo, with an ofcer from the taskforce, afew days before the October 30 Presidential elections to

negotiate with Chungu to return home through an amicablesettlement. We hear the government was not aware of thesearrangements by the taskforce.

Nkole, we have gathered, offered to renovate one of thehouses seized from Chungu situated in Kabulonga areaso that the former director-general could have been quietly

Taskforce – Chungu Deal Exposedput under some “sort of” house arrest while discussing the

deal. Nkole initially met a close relative of Chungu in Zambiawhere the plan was mooted and communicated to Chunguin Maputo before his lawyer Nicholas Chanda was draftedinto the whole plan. “It was the taskforce or Mr. Nkole to bespecic who rst made the contact for the meeting. It wasunsolicited…,” the source said.

It was agreed, according to one of the insiders who werepart of the deal that Nkole should travel with Chanda toMozambique to nalise the terms of the agreement withChungu. “We were told that the arrangement began before[President Levy Patrick] Mwanawasa died…,” the sourcesaid.

However, Nkole travelled to Mozambique without theknowledge of Chungu’s lawyer – Chanda -who was supposedto have accompanied him to nalise the agreement. Wehear Chungu refused to meet with Nkole in the absence of his lawyer and other ofcials from government so that thearrangement could be nalized with a state consent. “They

As ZSIC management withdraws recommendation to bail-out struggling

airline

The amount of the debts, which Zambian Airways owes to various creditors, isastronomical to say the least! The latest gure of the debt was slightly aboveUS$25 million and interest was accruing unabated. “The airline is bankrupt…,”said a senior manager in one of the private commercial banks that loaned millionsof dollars to Zambian Airlines. The board and management of the airline havetried all sorts of rescue packages that appear to be falling apart. “Liquidation isthe only answer but even then, the creditors won’t recover their monies,” risk andcompliance manager of a commercial bank said. He said the US$25 million debtis mainly from big creditors but if other smaller suppliers are added, the gurecould go beyond US$30 million.”They will need a government bail-out for themto survive,” he disclosed. But it is very unlikely that the ministry of nance will usestate resources to keep a private airline in the air in the midst of various nationalproblems affecting the country, especially in the mining industry.

The directors of the airline are Post Newspaper Editor and shareholder Fred

Mmembe, Taskforce Prosecutor and Lusaka Lawyer Mutembo Nchito, Hotelier Gaudensio Rossi and Passmore Hamukoma who is the chairman of theZambian Airways board. We hear three commercial banks are contemplating liftingthe corporate veil on the airline so that directors and shareholders should be madepersonally accountable to pay the debts which have accumulated in recent years.

The shareholders of the airline are JCN holdings owned by Nchito and his elder brother Nchima Nchito, Seaboard, a US rm that owns and manages NationalMilling Corporation (NMC) and the Post Newspapers Limited. The Post

Newspaper injected US$3 million in the airline using a loan facility from Investrust,which is still outstanding even though the company has tried to be update bypaying funds from the sales of the newspaper.

Attempts have been made to woo investors to buy into the airline but most of them have not been impressed with the nancial position of the company, whichwas worsened when the global oil prices had terribly tumbled on the internationalmarket and affected most airlines in the world.

The biggest debt is with FinanceBank Zambia Limited, whichhas been proving funds to keepthe airline oating. But we hear Finance Bank chairman Rajan

Mahtani‘s patience with the

airline is running dry and maypull the plug. However, he isequally constrained to make anymoves without the consent of other creditors who includes theInvestrust Bank Plc, IntermarketBanking Corporation and the state-run Development Bank of Zambia(DBZ), which by implications issupposed to be a shareholder inthe airline. Investrust Bank Plc,Intermarket Banking Corporationand DBZ syndicated a loan of US$5.5 million to Zambian Airways

in 2007, which the airline usedto purchase additional aircraftsto add to the eet. After failureto settle the loans on schedule,DBZ made a decision to swap theloan into equity even though most




Executive Issues

News

From page 1

From page 1

Zambia Airways

Faces Collapse

stayed there for a few days and returned without meeting Chungu…,” a sourceclose to the former spymaster disclosed. Nkole conrmed on state television

– ZNBC – that the taskforce ofcers had followed Chungu to Maputo prior to hisreturn but could not give details on the agenda of their trip. Chungu, we are toldcommunicated with his lawyers saying he could not have met Nkole because histenure at taskforce, including its legal authority, was not recognized by him andhis colleagues facing corruption charges.

Following the protracted negotiations, which could not materialize, Chungu, onhis own volition, decided to return home so that he could “clear himself” of theseveral criminal charges against him in the subordinate courts. He travelledfrom to Lusaka via Johannesburg in a business class using South African

Airways ‘Airlink’ passenger plane. Contrary to stories that he was spotted by theimmigration ofcers upon entry, Chungu presented himself to the immigrationofcers and was ushered into the VIP lounge before he was whisked to the ofceof the Inspector-General of the Police Francis Kabonde.

Chungu later explained to Jones Chinyama, sitting as trial magistrate for mostcorruption cases, that he had ed the country after receiving credible informationthat he was about to be assassinated by people he did not disclose. He saidhe was now sure that his life was no longer in danger and decided to returnhome. Chinyama ordered Chungu to pay ZMK500 million for breaching the bailconditions imposed on him by the court or face six months imprisonment for contempt of court. On arrival, Chungu presented a passport bearing his other names Franklin Kalinga Chungu, a document which is believed to have beenissued for operational purposes when he was head of the Zambian intelligenceor infamously called ‘Red Brick”. People close to Chungu conrms that theex-spymaster has often used the names of Franklin Kalinga even in his youthdays.

The taskforce has since slapped Chungu with charges of using forged documentsarising from the use of the said passport and will soon appear in court for trial.Questions have also been raised on how Chungu managed to obtain Visas toenter European Cities at will if his passport was a forged document as alleged bythe taskforce. Time will certainly tell on this episode!

Taskforce – Chungu

Deal Exposedminority shareholders objected to the deal. Financial analysts have questioned theCentral Bank role in these transactions saying the whole loan facility to Zambian

Airways was done without much supervision from the Bank of Zambia. “The

liquidation of the Airline will badly affect the nancial position of smaller bankslike Intermarket. BOZ should have taken a much stronger role in these mattersespecially that huge funds were moving into a non-viable venture,” he added. Asthe drama was playing out, the state-owned Zambia State Insurance Company(ZSIC), which had initially expressed an interest to inject US$4 million in the airline,withdrew its earlier position. The board meeting of December 16, 2008, the ZSICmanagement informed the board members that they had decided to withdraw therecommendation to inject funds in the airline on account of debts.

The management informed the meeting that ZSIC could not proceed with theproposed investment because Zambian Airways owed another state-run rm

– National Airports Corporation (NAC) over US$2 million and also raised issues of corporate governance within the airline. The airline is also believed to owe aroundUS$2 million to another state-owned National Pensions Authority (NAPSA), whichit has failed to service. We gather the deal to pump funds into Zambian Airwaysusing pensioner’s funds was made under the leadership of suspended NAPSAboss, Dr. Aubrey Chinyeke Chibumba.

The airline also tried to get funds from another state-run Zambia ConsolidatedCopper Mines Investment Holdings (ZCCM-IH) but the board rejected to theinvestment after doing a due-diligence study which showed that the airline wasbankrupt. The detailed report, compiled by Gershom Mumba, a former DBZmanaging director and an ex-International Monetary Fund (IMF) executive director who categorically stated that the airline was not a protable venture that wouldrequire any prudent investor to put funds in it. However, almost at the sameperiod, the ZSIC investment committee did a report, which stated that the airlinewas a viable business venture until the board refused to bulge in order to support

management.

There are credible speculations that the airline has not been servicing the taxeswith the Zambia Revenue Authority (ZRA), which complicates thecreditor’s positions. Legally, the payment of taxes will take precedenceof any creditor if the airline wounds up even though jurists still differ onthis position in Zambia.

As the company buys controversial Munali Coffee Farm for US$ 7.6 million

Dr. Aubrey Chinyeke Chibumba, the recently “sacked” Director-General of NAPSA,had ignored a set of probing questions sent to him over a questionable investmenthe made using public funds. Chibumba decided to buy a failing and collapsing coffeefarm – Muyubu Farms in Receivership– at a cost of US$7.6 million at a time when

coffee farming to collapsing in most parts of Africa. The transaction was concludedon November 14, 2008 through the Receiver – Pricewatehouse Coppers. “This wasone of the worst investment for NAPSA, Someone must be made to pay for this wasteof public funds,” said one NAPSA manager who had opposed the deal. The board of NAPSA announced the suspension of Chibumba recently and he has been replacedby Stanley Phiri who had been director of nance and investment at the state-runZambia State Insurance Corporation (ZSIC). NAPSA board chairperson Professor John Lungu, who had defended another similar questionable NAPSA investmentrecently, announced the changes.

Mubuyu Farms – otherwise known as Munali Coffee – is a classical failed project. Thefarm, situated 1,600 hectares of land near Mazabuka has been slowly going downfollowing the capricious weather pattern in Southern Zambia as well as the lack of capital injection. A US$10 million loan obtained from Barclays Bank Zambia by theowner Willem Lublinkhof failed to bring the farm to life despite sinking several boleholes to mitigate the drought pattern on the farm. Barclays, the traditional lender tothe farm for several decades, appointed a receiver Nitesh Patel of Pricewaterhouse

NAPSA ‘SACKS’ BOSSCoppers to recover the loan.

Following the frequent newspaper advertisement of the sale of the farm, very fewcredible investors showed interest owing to the complicated nature of coffee farmingand the collapse of the coffee prices on the international market. We hear the valuationof the farm was put at a lower price than what NAPSA paid, raising questions on the

transaction. A set of questions set to the Receiver remains unanswered over the actualvalue of the farm and the list of bidders who threw in their purchase intention. Thedeal was further suspicious when it was discovered that Chibumba decided to forma separate company, wholly owned by NAPSA, to be the purchaser of the farm. Thenewly formed Munali Coffee Company Limited intends to continue with the growingand processing of coffee despite the difculties the farm was facing. “Buying such afarm is too risky an investment for NAPSA to make. It is not going to them a return…,”an agriculture economist said.

We hear NAPSA has approached Zambia’s agric-giant, ZAMBEEF, to manage thenewly acquired farm on its behalf. It is not clear what terms will the management contractcontain but Chibumba was recently nominated to sit on the board of ZAMBEEF.

NAPSA had also injected ZMK10 billion of pensioner’s funds into the gambling business,Zambian Lotto, on the expense of credible projects in Zambia. The controversial lotto,which is majority owned by Lebanese nationals, was launched barely few months withoutany track record but Chibumba pumped in the funds to acquire 10 percent of the stake.




Executive Issues

News

Founder and until now Managing Editor of Executive Issues Dickson Jere has beenappointed Chief Analyst(Press and Public Relations) at State House by the newPresident Rupiah Bwezani Banda as such Jere will be among the top aides to thenew President. Jere formally took up his new appointment December 12 after havingbeen sworn-in the previous afternoon.

He was the Lusaka Correspondent of the French news agency, Agence France Presse(AFP). He has worked for The Post in Lusaka and is past President of the ZambianChapter of the Media Institute of Southern Africa (MISA). In 2003, he was appointedby late President Levy Patrick Mwanawasa as Commissioner on the Mungo’mbaConstitution Review Commission (CRC). He will be on a sabbatical leave from the

Dickson Jere is Presidential Aide

The National Women’s Lobby Group has called for wider national support for thecandidacy of Madam Justice Phyllis Lombe Chibesakunda who is vying for aseat on the International Court of Justice domiciled at The Hague, Netherlands.

“We need to support Justice Chibesakunda. If she is nominated, the Zambian agwill be put on the world map,” the Lobby has said, adding that her success wouldmotivate young Zambian girls to aim higher. Judge Chibesakunda is seeking aseat on the international court.

The candidacy however goes beyond mere gender considerations. JudgeChibesakunda, one of three female judges of the Zambian Supreme Court of

Appeal is in many respects a credible and worthy candidate with a rich, wellrounded background that goes well beyond service in the judiciary.

Positions Held;

• Head of the pioneering urban social project, Social Action in Lusaka(SAIL),

• Member of Parliament for Matero• Minister of State for Legal Affairs• Solicitor-General of Zambia.• Zambia’s Ambassador to Japan,• High Commissioner of Zambia to the United Kingdom• Judge in charge at the Industrial Relations Court.• Judge in charge of the Ndola High Court.• Chairperson – Human Rights Commission (HRC) of Zambia

• Judge – Supreme Court of Zambia

Nominations to the International Court of Justice should be nalized soon. WhatZambia has in Judge Chibesakunda, is a good candidate with a background thatqualies her for a seat on the court. What was not made clear was how Zambianscould advance her cause.

Who’s who

Judge Lombe Chibesakunda

– The Iron Lady

publication for the duration of his State House appointment. In his absence, associateeditor Arthur Simuchoba will take up the role of managing editor of the ExecutiveIssues.

Jere joins a team of other new aides who include veteran politician and academicianAkashambatwa Mbikusita-Lewanika who is special assistant to the President for Political Affairs, former Agriculture Minister Ben Kapita who is presidential aide for Special Projects and Dr. Richard Chembe, formerly Director at Central Bank, whois a special aide for Economic Affairs. Others include Principal PrivateSecretary to the President, Dr. Austin Sichinga, who was permanentsecretary in the ofce of the Vice President.

…Could draw up to $700 million for poverty reduction and infra-structure

Zambia will be looking for grant aid in the range of US$ 6-700 million from the USGovernment’s Millennium Challenge Account (MCA). The door is open and the

way, clear. Zambia was among three countries, worldwide and the only Africanone to qualify for grant aid under this scheme this year. Colombia and Indonesiawere the other two.

The MCA is a US project aimed at reducing poverty through income generationand promotes economic growth in the eligible countries. Zambia qualied

Zambia Qualies for US Grant Aid…

Barclays await court outcome but accusations persist nonetheless

Barclays Bank Zambia Managing Director Zafar Masud is known for being amedia friendly boss but this time around, he could not answer simple and clear questions put to him. His bank is being accused of serious allegations, whichneeded his response.

The controversial Mubuyu Farms was put in liquidation by Barclays Bank after the shareholders defaulted on a loan repayment as a result of the fall in coffeeprices on the foreign market as well as the drought that engulfed the southernpart of Zambia.

The farm was sold to Munali Coffee Limited, a company specically formed byNational Pensions Authority’s (NAPSA) suspended boss Dr. Aubrey Chinyeke

Chibumba on behalf of his corporation.

Note that at the time of sale, the company had not been incorporated and queries

sent to the Receiver at Pricewaterhouse concerning the same remain unansweredas well! Now, here is the allegation against Barclays; NAPSA bought the MubuyuFarm at a cost of US$7.6 million and appointed ZAMBEEF Plc as managers of the same entity.

Barclays Bank through its nominees own a substantial shares in ZAMBEEF andindustry experts have raised alarm on this scenario.

“Is Barclays, in cohorts with others too quick to pull the plug on nancially troubledcompanies so that it can quickly sell them to big corporations where it has aninterest?” the question still begs! “We wish to advise that the matter is currently incourt. We shall allow the due process of the law to run its course, whose outcomewe shall abide by,” said Webster Malido, spokesman of the bank who replied onbehalf of Masud after a protracted enquiry over the answered press query.

And as if to add salt to the injury, ZAMBEEF went ahead and appointed Dr.

Chibumba as a board member of ZAMBEEF barely weeks after appointing themmanagers of the controversial Mubuyu Farms. Was he appointed to sit on theboard in his individual capacity or what? We hear NAPSA has also shares inZAMBEEF under the public and institutional investors.

Barclays Bank Fingered in

Suspicious Deals

for support on account of her performance in ghting corruption and in other developmental areas.

“Zambia passed 18 MCA eligibility indicators, including the crucial corruption-

related one and this will reinforce the strength of our partnership,” said a senior project ofcial.

A two- year US$20 million MCA threshold programme that focused on facilitatingbusiness registration, countering corruption and improving border management

To page 4




Executive Issues

News

To page 5

Two months into his tenure, the new president is quietly beginning to leave hisimprint but the national focus has been on his negatives

“All politics is local,” so some observers of the political scene have concluded and twomonths into his tenure, Zambia’s fourth President Rupiah Bwezani Banda may notdisagree. His preoccupation this far has been a crowded and pressing domestic agenda.The imperative is no less than to position the country to wither the effects of the globaleconomic downturn. Its effects are real, are beginning to lter through and must be keptat bay.

Tackling the escalating food prices, the effects of reduced revenue resulting from theabrupt end of the copper boom, actual and threatened job losses on the mines and other sectors and the reorganization of the administration are issues that have and continue todemand urgent attention. Without some movement in these areas, the country would bein a perilous situation. To the extent that he has not so far moved to shake up or changethe administrative structure of his predecessor, he would appear to be something of agradualist.

Except for what was a limited reshufe, the cabinet and the upper echelons of the civilservice remain as before. That has not of course met with universal applause and has

continued to be the source of nagging questions of whether or not a new sense of urgencyor momentum can be injected without surgical changes in this parameter. PresidentBanda’s rst foray into international relations-an ofcial visit to Nigeria- was been deridedby some as a waste of time. It raised questions and criticism largely on the premise thatthe most pressing item on Zambia’s foreign policy agenda has to be Africa’s festering sore,Zimbabwe next door.

There could well be something to that. But as expressed, this position does not seem totake sufcient notice of the fact that the Nigerian President Musa Yara’adua had beenformally invited and had accepted to be the guest of honour at Zambia’s 44th anniversaryof independence on October 24, 2008. There are suggestions that this visit would havedoubled as state visit as well-the rst ever to Zambia by the new Nigerian leader. In theevent, the anniversary was a low key affair. It was overtaken by the death of PresidentLevy Patrick Mwanawasa and events had moved so far that by the time of the anniversary,Zambia was only six days away from the rst ever and hotly contested presidential by-election.

Nigeria was in any case not as bad a destination as it was made out to be. Though, it tendsto be seen through the prism of some of its more unscrupulous citizens, it is an Africancountry with a formidable and well established indigenous entrepreneurial class. It is in

its own right an economic powerhouse and Nigerian investment in Africa has tended tointroduce a new dynamic. Nigerian banks for instance are a hit and are much appreciatedin most of West Africa because the range of their products is more accurately informed byobjective African conditions.

Zimbabwe is of course a burning issue and has to be taken on board. However, theresults of the March 2008 elections which were internationally accepted reected largelyan internal political stalemate and certainly were not reective of any real consensus for change. Even if the opposition had won the run-off, they would have had a hard time of it because they commanded no real majority in parliament. Against this background, onlya considered response from Zambia will do and it necessarily shouldn’t be of the “follow-the- leader “type.

Normalizing the supply and escalating cost of the staple food, maize -meal has clearly beenthe top priority. Of the newly appointed ministers, Agriculture and Cooperatives minister Dr. Brian Chituwo was the rst off the mark. Barely a few days into his new post he

announced that Zambia would import white non-GMO maize and that the Food Reserve Agency (FRA) would have to release maize for sale to millers from the strategic reserve.It was the beginning of a concerted push which continues. The matter of increased maizeavailability on the market to lower mealie-meal prices that had by the time of the October 30by-election surpassed the K50, 000 mark was the most pressing issue from the outset.

The opposition Patriotic Front (PF) kept up the pressure and announced it would mounta country-wide campaign to protest the high prices. Government called for dialogueamong all stakeholders instead of demonstrations and President Banda was the fore mostadvocate of dialogue and not confrontation over the issue which had global connotations.“It is necessary that we work together. My doors are always open. I have never closedmy doors to any opposition leader. It is so necessary to talk to each other,” said PresidentBanda speaking at Chongwe, outside Lusaka.

That paid off.Cooler heads prevailed. The PF President Michael Chilufya Sata called off the street

campaign, opting instead to table proposals on how best to achieve a reduction in pricesand safeguard jobs on the mines. He said the PF would give chance to government toimplement the proposals it would submit and demonstrations would only be the last resort.Subsequently, the president of the opposition United Party for National Development(UPND) Hakainde Hichilema was to submit his party’s suggestions and ideas on howbest to respond to the global economic downturn. The opposition seemed persuaded togive dialogue a chance and not least by the President’s earnestness. How government willbuild on that new willingness to talk remains to be seen but it seems to have a achieved athaw and to have won for itself “a decent interval.”More poignantly, mealie-meal prices have began to reduce as a result of measuresimplemented by government, among them increased monthly supply of maize to millersby the FRA and at a lower price. The FRA now supplies 60,000 tonnes a month up from20,000 and has pledged a further increase should need arise.

“ Since the millers will now be accessing the maize from FRA, there is no reason why theyshould not respond by reducing the prices of mealie-meal as well since their concern wasthe cost of maize,” said Dr. Chituwo. Prices are now falling gradually and the supply side

is being taken care of by imports from South Africa and there is reason to believe that thesituation will remain stable until the next harvest. These measures were corollary to theearlier decision to increase the subsidy to small-scale farmers under the Fertilizer SupportProgramme (FSP). The IMF is known to have been non too pleased but as things areturning out, the decision from the government’s point of view is apt. For, it is the small-scalefarmer who is more likely to sell his crop to the domestic market without contemplatingexports which would appear to be new swan song of the “private sector.”

Escalating food prices are however merely one strand of the effects of the global nancialdownturn. The meltdown has seen to a rapid collapse in commodity prices. Metal prices tooand copper, Zambia’s main export has been no exception. The copper mines scrambled toadjust and in short order, the copper processing plant at Bwana Mkubwa, Ndola was shutdown. Next, the Luanshya mine-a low grade, ill-fated from the start operation also shutdown and the mine was rapidly put on a care and maintenance basis to prevent ooding.Upwards of 2000 workers were left high and dry.

The situation was particularly dire in Luanshya, a town that revolves around the mine.Closure of the mine meant the virtual death of the town itself after a period of hope that itwould survive. President Banda traveled there to meet with management and the unionsfor a brainstorming session on the way forward. In addition a cabinet level monitoringteam that includes Labour and Social Security Minister Austin Liato was constituted towatch the situation on the mines. But there are no easy answers. There are all manner of suggestions including the ‘heretical” one of nationalization like western governments have

Evaluating the Banda Presidency – Two Months On!

was successfully concluded in June 2008 which how Zambia won eligibility for more aid. Top MCA ofcials were expansive and congratulatory.

The CEO John Damilovich described Zambia’s winning of eligibility as “a hugemilestone in assisting to improve economic development and reducing poverty.The MCA has formally recognized the Zambian government’s commitment toinvest in its people through education, health care, its commitment to the freemarket, facilitating business, governance and ghting corruption,” said the ofcialstatement.

Secretary to the Treasury Likolo Ndalamei has recently indicated that Zambiahas already initiated consultation on drawing up a work plan for the integratednational ve-year MCA programme. It is the government of Zambia that hasto drive the application process which has to involve public consultations andthe funds will be accessed only after detailed negotiations and signing of thenecessary agreements.

The funds can be used for infra-structure development and improvement andpoverty reduction in line with the goals of the Fifth National Development Plan(FNDP) and other areas.

Zambia joins 18 other countries around the world that have completed MCAcompacts and a half dozen more that are in the process of negotiations. So far,Tanzania has qualied to access US700 million while Madagascar got US$100

million and Namibia, US$300 million. The MCA is one of the USGovernment’s innovative foreign assistance programmes aimedpoverty reduction. What remains to be seen is how much and howsoon Zambia will draw from the facility.

Zambia Qualies for US

Grant Aid…From page 3




Executive Issues

News

Evaluating the Banda Presidency

– Two Months On!

done to most of the nancial institutions! But there is as yet no decision on how to proceedand the stimulus and other relief measures for the mines may come via the budget.There was this assurance from the President though:“What we are considering is that if possible, we ensure that out workers do not remain

unemployed. How we are going to do it, we do not quite know yet, but we are denitelymaking plans to enable our people in Luanshya continue with employment.” That effortcontinues.

The larger picture is that there has been at least a partial review of expenditures leading toa re-designation of priorities.

Zambia’s withdrawal from hosting the tenth all-Africa Games scheduled for Lusaka in August 2011 has met with a mixed reaction but is connected to that process. There thosewho argue that the country has lost a great opportunity to market and put itself on the worldmap. That could well be so and the withdrawal cannot have enhanced Zambia’s credibility.However, that decision does not appear to have been taken in isolation. Instead it came aspart of the re-ordering of priorities. “The combination of the recent presidential elections andthe expected fall in revenue arising from the global nancial crisis forcefully dictated thatthe Government chooses between the honour and pleasure of hosting the games and theduty to provide food and social service… Government has decided to shift resources for thehosting of the games that would have been in excess of K800 billion to the identied priorityareas such as food production, provision of social services, housing and infrastructureconstruction,” said Chief Government spokesman Ronnie Shikapwasha.

The rst two months of President Banda’s stewardship present a mixed picture but onecharacterized by moves to get to grips with a situation that is potentially a crisis. So far, thathas been averted. Whether the emerging approach will do for future crises which promiseto multiply as global downturn bites is at this stage an open question.

From page 4

Government needs to ensure stable supply for the domestic market and notby administrative instruments.

The recent statement of the Agriculture and Cooperatives Minister Dr. BrianChituwo on the “government decision to import 100,000 metric tonnes of non-GMO white maize” made interesting reading:

… “[at meeting in June 2008] It was … agreed that the private sector, coordinatedby the Zambia National Farmers Union, prepares a draft Memorandum of Understanding (MOU) to facilitate the importation of maize stocks…However,the preparation of the MOU did not go through as the private sector demandedfor some clauses which the Government was not comfortable with. The mostcontentious was to allow the private sector to export the maize in case there wasmore maize by the time the imported maize landed in the country. The Governmentwas not comfortable with this clause as it could have given the private sector express authority to export even the local maize without importing any.”

By then, the meeting that was chaired by former joint Minister of Agriculture, SarahSayifwanda had arrived at the conclusion that “the country had no maize surplus

given the change in national consumption patterns” from 50,000 o 60,000 tonnesand therefore that Zambia needed to take a precaution by allowing the privatesector to import maize preferably from South Africa to forestall a shortage.

The issue was clearly an imminent shortage and how to forestall it.

But somehow and in the same breath, there was also this clear anticipationof an export opportunity for Zambia for the same soon-to-run-out maize! Thisambivalence is hard to explain but there has to be an explanation.

“The private sector was categorical that there was need to import maize becausethey did not have enough maize of their own. How come six months later…thereis maize available on the local market. Where was this maize stock duringearlier discussions? Surely, Government cannot be held responsible for some

stakeholders under declaring maize stocks in their possession.”Reading through the Minister’s statement one is left to wonder what the real storybehind the high mealie-meal prices of the recent past is. Was it really a part of the global economic downturn or simply the result of the exigencies of the localeconomy?

The impression created is of some actors in the “maize eld” who were so intenton exporting maize that they held on to it, waiting for an opportunity to export.

But there are other strands as well.

When the 2008 budget was unveiled one of the earliest complaints about

an insufcient allocation came from the Food Reserve Agency (FRA) and theUniversity of Zambia (UNZA). FRA chairman Costain Chilala said almostimmediately that the allocation of K80 billion for maize purchases was insufcientand government had to give out more if the strategic national reserve was toexist.

There then ensued an exchange between the FRA and the Ministry of Finance. Inquite brusque terms, the Minister of Finance Ng’andu Magande said there wouldbe no additional allocation and if the FRA needed more money it could borrowfrom commercial banks. But Chilala in turn pointed out that this had been donein the past but had only left the FRA with a debt that it was struggling to repay.Unfazed, Magande stuck to his guns and invited the private sector to step intoany breach.

In the end, the FRA had to make do with the paltry allocation and the result wasthat it bought only 73,000 metric tonnes bringing the total in the national strategicreserve to 150,000 metric tonnes.The extent to which this inadequate national reserve inuenced the price spiralis an open question but could be a factor. The matter of maize exports croppedup again during the Euro-money conference held in Lusaka at which the exportban that was in force then was cast as a primary disincentive to productionbecause it was an administrative instrument that ignored market fundamentals.But crucially maize is the designated staple food of Zambia, though in practicecassava seems to be more widespread and as a crop would appear to be lessproblematic than maize at least to grow.

For that reason Government is on guard twenty-four hours especially as the

reaction to any instability in the maize market tends to come from the politicallyorganized urban elite. Thus government nds itself more readily impelled tointervene on the side of consumption ignoring the blatant contradiction of that inthe face of sermons about the need for a free market! At the same time, maize isgrown by farmers looking to a return, preferably a good one on their investmentand they would for that reason sell it wherever it may attract that kind of returnregardless of whether or not it is the domestic market.

It is clearly the interaction between these two - the Government and the farmer-that will decide whether or not the country will have a steady and stable maizesupply or it will forever be re ghting and on the tenterhooks as in the recent past.The matter goes beyond the private sector’s supposed perdy or “hidden agenda”or for that matter government’s “high handedness.” It is economic.

Clearly, if supply is to be stable and predictable in the main because Zambia stillrelies on natural rainfall anyway for most of its core agriculture, the nal price of maize will have to reect the cost of production and if those costs are high, maizeis unlikely to be cheap however hard the yearning for cheap maize even on thepart of government, may be. The ofcial position at least when publicly stated isthat maize has to be “affordable” and that has policy implications that still have tobe addressed. In a situation where compensation for the burden of production isnot enough, government’s intermittent interventions “to straighten up the market”will only add to unpredictability of the market and discourage production.

Maize will progressively become a crop whose returns are uncertain and rather than spend sleepless nights calculating what they may be, farmers will simply skipgrowing it and keep their sanity! So, while intermittent government interventionsmay please everybody and lead to low retail prices in the short term, long-term they

could be damaging leading to a situation where Zambia’s output will consistentlybe below national consumption. Zambia may in fact be at the crossroads on thisvery fundamental issue and the primary role in resolving it, is government’s.

Agriculture has chronically under-performed since liberalization largelybecause of so much “unnished business” in the liberalization chain.

Maize: Export or Perish?




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There is for instance, no nancial institution devoted to lending to agriculture yetcredit and especially seasonal loans are an imperative as is long term nancespecically for agricultural projects. The country is also losing its ability tomanage livestock because of decl ining and poor veterinary services. A clear policyframework, one that addresses the real issues of in this instance, the maize sub-sector will end the need for the Ministry of Agriculture to be supervising millersinstead of mill foremen!

It is above all, an enabling environment for increased production of the staplefood that is absolutely required. Micro-management of chronic insufcient supplycannot lead to self-sufciency nor can it assure success even in that Endeavour.

But there is reason to hope because something of the required forward-looking approach is beginning to emerge as regards peasants andsmall-scale producers. Funding for the Fertilizer Support Programme

(FSP) has been increased. Not everybody is happy, the programme itself wouldseem to have any number of teething problems and there may be real questionsabout it. Yet it is a step in the right direction because it attempts to address thematter from the cost of production angle and as the Farmers’ Union once rightlypointed out, this kind of incentive should apply to every maize farmer, not just thepeasant.

It is true indeed that government intervention must more directly address production

bottlenecks and not just the cheap consumption of what may be inadequate. Thelaw of supply and demand will be on the side of government. It is simply thatthe more the production/supply, the more the price will fall-that is the solid statewithin which Zambia must eternally perambulate. Outside it, the government willcontinue to suffer the indignity of supervising millers and the “private sector” in asupposedly liberalized, free-market economy. It doesn’t have to be that way.

Maize: Export or Perish?

Strong demand for the dollar and copper price fall blamed

Zambia’s currency, the Kwacha depreciated by 70% during 2008, StandardChartered Bank sources have disclosed. Most of the decline occurred in the lasthalf of the year. At its strongest, the Kwacha fetched K3, 100 per dollar but fell to

as low as K5000 a dollar by the last half.

The depreciation is blamed on massive buying of the dollar by offshore players tofund their US dollar requirement and on the inevitable capital ight in conditionsof the uncertainties triggered by the credit crunch. The fall in the price of copper from highs of US$8,000 per tonne to US$2,770 at the end of December 2008is cited as the other factor. Pundits expect the Kwacha to be stable in 2009 at

around K4, 800-K5000.

Kwacha Nose-dives

The broad objectives of the 2009 Budget will more likely be, as in all recentyears, maintain macroeconomic stability.

The call from Civil Society has been consistent and is again on the table.It is for a “pro-poor” budget-one that seeks to reverse the abject poverty that stillaficts the majority. So, what the 2009 budget must do is already cut out for it.The devil is of course in the detail.

There however promises to be no radical departure in the broad objectives of the2009 budget due in February from those of the budgets in the past few years.The macro economic objectives should remain broadly to sustain macroeconomicstability; maintain government borrowing at sustainable levels; promoteeconomic diversication; increase investment in human capital and enhance thecompetitiveness of the economy.

Budget 2009: Likely More of the SameA higher decit is projected this time because of a limited revenue base and

reduced revenues due to the depressed international commodities market. Thelarger decit that is almost a certainty by now is likely to be met by traditionalmeans: increased external and internal borrowing.

The travails of the mining industry in the light of reduced demand and thereforereduced prices of base metals will also certainly attract some re-think on taxes,levies, tariffs and other costs that have made mining more precarious in thepresent economic climate.

The overall objective is to keep Zambia still attractive to foreign investors evenwith the international economic chill. However, most Zambians have now comeround to the view that contrary to the popular perception, mining is the curse andnot the engine of economic growth that it tends to lull the country into believing in




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Budget 2009: Likely More

of the Sametimes of metal price booms.

This has reinforced the conventional wisdom that the sooner the country diversiesand moves away from dependence on mining, the better. That is of course as oldas Zambia itself.

But there is now once more a renewed focus on diversication of the economy.Finance Minister Dr Situmbeko Musokotwane’s, ministerial statement to

the National Assembly on November 28, 2008 was explicit: “Governmentis considering measures in next year’s budget (2009) to enhance thecompetitiveness of the economy and promote economic diversication” and thatinfrastructure development would be given “high priority in the areas of agricultureand tourism.”

Bank of Zambia Governor Dr Caleb Fundanga is on record on the need for anew push for economic diversication with agriculture as the centerpiece of it.That again was more or less the theme of Chief Government Spokesman,Information Minister Ronnie Shikapwasha’s press brieng on December 12,2008 when he said government had prioritized its expenditure to save moneyand concentrate on selected areas “such as food production, provision of socialservices, housing and infra-structure construction.” All these are pointers to whatlies in store.

How this increased shufing of feet around diversication and poverty reductionwill in the long run differ from that of the past remains to be seen. However,for the 2009 budget it is more likely to translate into increased allocations for the agriculture sector and poverty reduction measures. Agriculture and socialprotection are expected to get some of the highest allocations in the 2009 budgeton account of the evident and pressing need to enhance food security and reducethe effects of rising prices on the population.

Curbing ination which at around 15% has once more climbed to a double digitgure will remain a key objective. Measures to reduce it to 10% during the year before further cutting it down to about 9% by 2010 are expected. No changeexcept more prudence and stabilization is expected in the management of theexchange rate.

Sectors that will help improve the country’s food production and reduce povertyare set to receive priority in allocations. The 2009 budget is expected to moreforthrightly put agriculture at the centre in line with the Fifth National DevelopmentPlan (2006-2010) than was the case with the 2008 budget. While that budgetremained broadly within the set out framework of the FNDP and the Vision 2030,fears were expressed by some that it did not put nearly enough emphasis onequity and poverty reduction-areas where agriculture is thought to be key.

Issues of equity and poverty reduction will undoubtedly have some play in the2009 budget as will have the overall framework of the FNDP. There cannot betoo much of a departure especially as Zambia’s cooperating partners, the donors,have already pledged budget support for 2009 despite the effects of the global

slowdown on their own purses.

For that reason, Zambia’s 2009 budget will have to be in line with mutually agreedpriorities and objectives. A broadly pro-poor budget would appear to be in theofng. How far it will go in addressing the identied needs and the extent to whichit will pull Zambia away from the ravages of poverty is of course what will only beclear come budget day.

The small Southern African Kingdom of Swaziland is not so far a fully-edged. Pariah yet if there is no dialogue soon towards fundamentalpolitical reform, it would seem inexorably headed that direction.

Swaziland is mostly idyllic. For the most part, it sits atop a landscape of mountains

Swaziland: King and Countryand hills interspersed with what are at this time of the year at least, lush rollingvalleys. Except for a border with Mozambique, it is completely surrounded by itsgiant neighbour South Africa. With a population estimated at just over a million, itis mostly neat, in repair and boasts an impressive road network.

Mbabane, the capital is built on a series of hills. Stunning residences huddle thehillsides in its leafy suburbs and it has a modern and adequate shopping centre.The nearby town of Manzini is the industrial hub. Its satellite town of Matsaphais the kingdom’s industrial centre. Sugar, pineapples and citrus fruits are amongits notable agricultural products. For its size, it has a vibrant economy with whatappears to be a growing middle-class. The kingdom is proud of its African heritageand Swaziland is perhaps the closest one gets to an authentic African countrystill run on ideas informed by the African heritage. It would have been a source of immense pride if it would work. But it doesn’t.

In fact, it is the system of government that is the source of growing internaldisaffection and now poses perhaps the single most potent threat to Swaziland’scontinued stability. As an absolute monarchy, the last in the world, the King,Mswati III is the head of state and the kingdom’s chief executive ofcer.

He is the absolute ruler of Swaziland by a traditional system that effectivelydenes the country as his efdom. He is above the law and the law is largely hiscommand!

His dominant position derives largely from Swazi feudal tradition and increasinglynowadays it can only be maintained by constantly stiing and outright warding off of “modernity” including universally adhered to tenets of government. Politicalparties are for instance, not allowed.

With a population that is increasingly eager to participate in governance, that sortof posture by the king and can only come with a price and it a high price indeed thatthe Swazi monarchy is having to pay for attempting to stem the movement of time.In contrast to the exulted position and prestige that the king must have obviouslyenjoyed through most of history, the Swazi monarchy today is discredited and

damaged perhaps i rretrievably.

As a result of being the country’s top politician, the King is in popular perception,the rst and last villain. Even in matters where he may not have had a direct hand,“the king is to blame.”

Clearly, the king is sinking deeper into a quagmire from which he may not extricatehimself and could lose everything.

“…As long as political power remains in the hands of the king, you and I will never have a say on how the country’s resources should be allocated and utilized,” wrotea columnist in the Times of Swaziland who accurately reected the frustration of many in the country today. The growing frustration is over many issues but centralis the kingdom’s “African system” of government. It is loathed by many. It is seen

to interfere with and subtract from the rule of law and fundamentally to deny anymeaningful role or participation in the running of the country by anybody other than the king and his placemen. The way the growing army of critics sees it, thissystem is nothing more than a corrupt dictatorship with the King and not somecorrupt politician as the autocrat in-chief.

Under the system, effective planning is undermined. By tradition for instance, theKing has also to be the kingdom’s most married man and he can marry “as per tradition,” which means in practice, at his and the royal establishment’s whim. Healready has a seraglio of 14 wives, but against “tradition” he has of late neglectedto take on more wives due apparently to international pressure to end theserepeated royal weddings!

Few however seemed to begrudge him his many royal wives as such. At issue wasthe havoc that these marriages caused the kingdom’s capital budget. For sooner or later, the new royal bride has to be ensconced in a brand new royal palace andsince there is no schedule, money has to be diverted, usually from the capitalbudget! The King has many residences and they can’t by denition beramshackles. They must reect his status and the Swazi monarchy has

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Neither the Zimbabwe Government nor the SADC mediator accepts apolitical role for the UN. But what now SADC?

UN Secretary-General Ban Ki Moon would appear not persuaded that theSouthern Africa Development Community (SADC) is getting anywhere with itsinitiative on Zimbabwe. Brieng the Security Council recently he said SADC hadeffectively taken responsibility for the whole power-sharing arrangement andmust now deliver. The UN was being effectively locked out of efforts to resolvethe Zimbabwean impasse as “neither the [Harare] Government nor the mediator welcomes a UN political role.” Now, with cholera sweeping through that countryleaving as many as over 1,000 dead and the power sharing deal between ZANU-PF and the MDC still bogged down in haggling for key cabinet portfolios, theSecurity Council called for progress in the SADC initiative.

The Security Council debate came as the Zimbabwean situation approached anew low. Apart from cholera, ination is estimated to have risen to 230 millionpercent, shortages are endemic and even basic food is scarce. But PresidentRobert Gabriel Mugabe remains “stoic” and even deant. Opening the annualcongress of his party in Harare recently he vowed to “never, never surrender.”

Insisting that “Zimbabwe is mine,” he made the astonishing assertion that “RobertGabriel Mugabe was elected by his people!”

That alarmed western governments. Nordic countries called for progress in thepower-sharing deal. Britain and the US impatiently noted that Mugabe was intotal denial. But more was to come. As if suddenly, the US Assistant Secretaryof State for African Affairs Jendayi Frazer announced December 21, from South

Africa that the US government would no longer support the SADC-brokeredpower sharing agreement in Zimbabwe. The US was withdrawing supportbecause Mugabe was an impossible obstacle and for as long as he remained the

Zimbabwe: A Wooden Spoon for SADC

Convictions in Arusha as Kenya sets up a tribunal

December 2008, may well go down in continental history as marking the beginning of an end to impunity in Africa.

In rapid succession, the United Nations Tribunal on Rwanda sitting at Arusha in Tanzania sentenced to life imprisonment, Theoneste Bagosora one of the master minds of the 1994 genocide in which up to 800,000 people were massacred, in a pogrom that outraged the world and has continued to gnaw at its conscience.Bagosora, a Colonel in the old Rwandan Army was found to have been at the head of a committee that plotted the harrowing massacres of ethnic Tutsis and was given

Squeezing Out Impunity

elements of duality with a strong role for the king mother for instance who mustalso be taken care of appropriately as have to be the numerous other membersof the royal family!

Ordinary Swazis have the vote.

They elect a National Assembly that meets at Lobamba. But it pales in signicantbefore the king and cannot match his power. The royal budget for instance ismerely presented and not debated by the National Assembly and to be elected or nominated one needs to have “caught the king’s eye ” one way or the other.

Political parties are outlawed “for the time being” and election to the National Assembly is strictly not along party lines. A “traditional” system governs electionsand it invariably leads up to the king! This system has its supporters, some of

them die-hards. But it is dissatisfaction and anger that predominates acrossSwazi society. The King is increasingly in the ring line because as things standthere is no way of avoiding him. Voices are raised to the effect that the king mustrelinquish power to an elected executive. Allow political parties and generallyusher in a system of government in consonant with the 21st century if stability is to

leader of Zimbabwe there could be no meaningful power-sharing. He had to gorst for it to have a chance at all. “We have lost condence in legitimate power sharing being viable with Mugabe as President. He has lost touch with reality,”said Frazer. She called on him to retire saying his “time was up.” The US movesupported by Britain seemed aimed at Mugabe. But in fact as Herman Cohen,Deputy Assistant Secretary of State for African Affairs under President Bush

senior told it, it was primarily aimed at stopping South Africa, the SADC mediator in its tracks. As he told it in a recent BBC television interview, South Africa had of late been leaning hard on Morgan Tsangirai, leader of the MDC to accede to allof Mugabe’s stratagems and move in with him in a government of national unityon basically his terms!

The west is basically saying, now way to that. It is adamant that power must begenuinely shared. Mugabe’s unbending posture and deance has convinced major western governments that any government led by him of whatever complexion isunlikely to work and that therefore any power sharing has to await a new leader.SADC that has long cuddled Mugabe and has never so far talked of his departurewould appear to be in a crisis. Either it joins the chorus for his departure andpressures him to go or in the circumstances become irrelevant.

Outwardly at least, Mugabe is his usual unrufed and dismissive self. ButZimbabwe will pay dearly for his non—chalance. In the short term, noimprovement in the country’s political or economic situation will be possible. TheUS is withdrawing support for rescheduling of the country’s US1.2 billion debtsto the World Bank and the IMF and Zimbabwe ravaged as it already is will onlysink deeper into debt and poverty. With the political impasse continuing in thatunhappy country, the question mark is on the direction that SADC will now take.Its sputtering negotiation has unraveled. What will be SADC’s response; will therebe a viable next step at all?

Swaziland: King and Countrythe life sentence for genocide and crimes against humanity.

In the same month, both the Kenyan President Mwai Kibaki and Prime-Minister

Raila Odinga were left with no alternative but sign into law legislation to set up atribunal to try identied perpetrators of post-election political violence which left

1,300 dead and 300,000 homeless following that country’s failed General electionin December 2007. In both these cases, the thrust is to bring to book, those whowere behind these events that not only sullied Africa’s reputation and image butfell far below accepted civilized standards.

Together with Bagasora, two other commanders in the old Rwandan army wereconvicted on the same charges and were similarly sentenced to life terms. InKenya, under the new law perpetrators of the violence may in addition to lengthy

jail terms be barred from holding or seeking public ofce. Under agreementsfor the power-sharing government signed in February 2008, a commission ledby Kenyan Judge Philip Waki was appointed to inquire into the violence andrecommended the setting up of a special tribunal with Kenyan and internationalmembership to try perpetrators of the violence. There was some dilly-dallying butpressure mounted on the Kenya Government for action on the legislation and it

was recently signed into law.

It is a tough one:

“The special tribunal will look into the prosecution of people bearingthe greatest responsibility for genocide, gross violation of human rights

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Parole will provide a window for those who would be victims to prolong their precious lives

Zambia has introduced the parole system to help decongest prisons and as part of a paradigm shift in its criminal justice system. Prison congestion had led to a progressivedeterioration in conditions leading to infection of inmates and poor and unhygienic living conditions generally. Many of those who have done time have been released only to dieshortly after. In these circumstances, custodial sentences were beginning to operate effectively as death sentences in a system that is supposed to help deviants reform.

Editor’s Note - Parole System for Zambia

Squeezing Out Impunity

and crimes against humanity. Persons convicted of crimes by the tribunal shall inaddition to the prison terms be barred from holding public or elective ofce inKenya,” the new law states. By some accounts, a secret list of culprits which thecommission has refused to reveal already exists and is said to contain the namesof a number of prominent politicians and businessmen.The catch was always that if the Kenya Government did not go ahead, the listwould be handed over to the International Criminal Court (ICC) for action.

The setting up of the tribunal had become a virtual condition for aid to Kenya andperformance on many bilateral and multilateral agreements came to be conditionalon the setting up of the tribunal.

The Kenya Government has nally taken the plunge and overall in the rightdirection as well. The point has to be made that there will be no impunity for anyone. That will perhaps promote responsible actions on a continent notparticularly noted for scruples.

reign in his ancient kingdom.

There are already up to ve political parties in the kingdom. They are unregisteredand exist largely by default on account of the fact that the same constitution thatoutlaws them confers on the Swazi people the fundamental constitutional rightto freely associate and a political party is by denition an association. Some of these parties now talk of “armed struggle” to “liberate” the country. This agitation

is bound to grow, not diminish. But in the manner of most tragic gures in history, the King seems oblivious tothe growing discontent within. Most Swazis seemed to have long forgotten anypositive aspects of his stewardship. He dutifully presides at traditional ceremonieslike the Inca’wala recently. Except for the recent suspension of royal weddings,there is little discernable movement from him. There have instead been recentlysuggestions of a hardening stance on his part. A draconian anti-terrorism lawis in place and the leader of one of the opposition parties Mario Masuku of thePeoples’ United Democratic Movement (PUDEMO) has recently been arraignedunder its provisions.

However, it is reliably learnt that the action has met with the disapproval of powerful international circles and government may be hard-pressed to proceed.

Still, it is an indication of the sort of response that the ruling circles consider appropriate to what are legitimate demands for change. There is so far noindication of willingness on the part of the king and his apparatus for genuinedialogue on the future of the country. They are simply sitting tight until it seemstime runs out on them. On the basis of the current state of play, there maybe no happy ending to the growing political impasse in that country.

Swaziland: King and Country

Through the parole system, the country is opting for a more human rights based

model away from a retributive one. There are about 15,000 prisoners today ininstitutions built for a maximum holding capacity of 5000! Zambia is ranked to havethe third most congested prisons on the continent.

“The prisons in Zambia were built for a maximum capacity of 5,000 prisoners andhave not been expanded since, despite the prison population having increased to thecurrent 15, 000,” said Home Affairs Minister Dr Kalombo Mwansa when launchingthe system. The minister said the congestion had greatly compromised human rightsin prisons. There was inadequate water, food, medicine and bed space. Classicationof prisoners according to age and type of crime had become impossible.

“Those serving time for the worst crimes are mixed with new offenders or thoseserving for minor offences, leading to a worsening of criminal behaviour and theperpetuation of crime syndicates,” he observed. Now, under the Parole system,prisoners serving custodial sentences will have the opportunity to appear before theParole Board for review and depending on the merits, the board will be in a positionto commute some of the sentence to a non-custodial one.

There is a lot going for this system. Successive studies have established that non-custodial sentences offer better opportunities for rehabilitation and rehabilitation iswhat Zambian prisons are supposed to be all about.

“It is the belief of this government that prisoners should be supported and givena chance to return to their communities in time to reconstruct their lives,” said Dr.Mwansa. The parole system would also stabilize the family unit as often it is thebread-winner who goes to prison leaving the family in a precarious situation withoutadequate support. “Adverse conditions of incarceration have the potential to reduce

one’s life due to disease. Parole in this regard will provide a window for those whowould be victims to prolong their precious lives once released,” the Minister said.

It was time that Zambia reclaimed its able people from the prisons. With that, theParole System was ofcially launched and Frederick Chilukutu was named theParole Board Chairperson. Members of the board are drawn from civil society, thePolice, Prison Service, and the Christian Council of Zambia among others. But evenwith this growing ofcial concern, few new prisons have been built and there is stillno talk of building at least one modern prison in line with the paradigm shift that thegovernment seeks. Prisons are not only congested but are outdated as well; virtuallyall date back to the colonial era. If there has to be a real paradigm shift, it will need tobe reected in the kind of prisons the country has as well.

The occasion was used by some to exalt former President Chiluba to Christ-

like status

December 29, 2008 marked the 17th anniversary of the controversial declaration of Zambia as a Christian nation. The occasion was used by some within the Christianmovement to exalt the former President Frederick Chiluba who as president madethe declaration to a Christ-like status. In reference to his cases in the courts, he waslikened to something of a Christ being persecuted and tormented presumably by thedevil himself or his forces!

Some yers distributed as part of the observance held at the Cathedral of the HolyCross in Lusaka listed his achievements and called for a greater recognition of whathe did for Zambia and to honour his memory! This was the closest Zambia came to acelebration of the Chiluba years and rehabilitation of his legacy in recent years.

The former President mostly cuts a lonely gure. His reputation and image severelydented by the criminal cases in which he is accused of primarily theft of public funds

Religion -Pentecostals Mark

Declaration of Zambia as a

Christian Nation

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while in ofce. There were a reported three separate observance services in Lusakaalone. The high level one was on the afternoon of December 29, in the Cathedral of the Holy Cross attended by Chiluba himself.

He made an emotional speech which probably sat well with his audience but wasdistinctly disturbing to many rational people. He said he had made a covenant withGod when he made the declaration and that he was “the anointed of God.” Morequestionable still, he said Zambia had been “cursed” when it voted for the isolation of Israel after the 1973 Middle East war and that it was he who removed the curse whenhe declared Zambia a Christian nation and renewed ties with Israel!

He had the direst of warnings for those who were “insulting” and “calling me names.”

God, he warned would crush them because he being the anointed stood on rock thatcould never be broken. The rant went on. It came on the same day as the Presidentof the Patriotic Front (PF), one time staunch Chiluba ally, Michael Sata deliveredperhaps his most direct and unambiguous public rebuke of the former president, asthe two men drifted further apart.

He is reported to have described Chiluba as “disgraced,” “desperate” and “in aweak position.” Subsequently, Sata was even more cutting t when he said the former president should “shut up. Chiluba would appear to have been anxious to put his owncase across. One of the other things that he said was that he was “still clean” and thatthose who dared to touch him would be “crushed by the Lord.”

It is hardly surprising that the anniversary saw such an outpouring of emotions. For,the declaration itself was largely an expression of emotions when it was made. Itcame at the end of an emotional séance at State House in December 1991 that wasattended by the new President as Frederick Chiluba was then and a coterie of born-again Christians in the new government and around Mr. Chiluba.

At the time, it was a agrant violation of the Constitution of Zambia or at besta nullity because the constitution then clearly stated that the country was

constituted as a secular state. In time, the declaration assumed a life of its own as the“faithful’ mainly from the Pentecostal churches and the “Born Again’ Christians tookownership of it. It became a prime cause with an ever growing calamour for it to beproperly enshrined in the constitution so that it had the force of law.

There was no end to that call as the sort of “faithfuls” whose conduct has continued toraise questions and change perceptions about organized religion in the country, rallied.It was nally enshrined in the discredited constitution of 1996 which is largely still inforce and states that Zambia is a Christian country but which tolerates other religions.

Many of the more mainstream and sober denominations notably, the inuentialCatholics have maintained their distance and even criticized the declaration as

unnecessary. But other groups mainly within the Pentecostals remain adamant andthe National Constitutional Conference (NCC) still has to decide whether or not it willbe part of the next constitution.

But judging from the 17th anniversary observances, it would appear that someChristian groups are still anxious to have the declaration retained and for Zambia tobe transformed into some kind of theocracy. The main demand seemed to be thatDecember 29 should declared a public holiday in remembrance of the decision by the“man of God- Chiluba.”

But there is also the possibility of this movement turning into an out and out Chilubasupport and advocacy group. For, it is not without its fanatics and those who see thingsin broad black and white strokes.

Obviously in reference to his court cases, a prayer during the observance cast Chilubaas being “persecuted for making the declaration.” The former President and his legacyare divisive nationally and will remain so the longer his cases remain undetermined.They have been hanging around his and the country’s neck since 2002-long enoughfor many to now want them to go away so that there is more focus on the present andless on some of the emotional episodes from the past.

The power debate must move on and focus on alternatives to hydro-power

The debate on power triggered off by the necessity to ration electricity since thebeginning of 2008 has singularly lacked in new or innovative ideas, going forward.The damage to the economy and to Zambia as an investment destination has

continued unabated. Instead, the debate has largely been stuck at restatingand recycling the doubtful position that Zambia’s salvation lies in more hydro-power stations even though these have a long lead time, are expensive to buildand crucially are of no help in times of drought which is projected to recur under conditions of climate change. More hydro power stations has been all the rageand the sound approach of a mix of power sources that complement andsupplement each other has received little play. Clearly, even if hydro-power isto remain dominant it must progressively be supplemented and complementedby a cocktail of other preferably renewable sources. There has been little said onalternatives to hydro-power even though they do exist. The level of debate maynow be changing.

A practical new idea from the Energy Regulation Board (ERB) for the constructionof a Heavy Fuel Oil (HFO)-driven electricity generating plant in the vicinity of

the country’s only petroleum renery in Ndola has recently been oated. Theunderlying rationale is that the plant is the nearest the country can get to a “quickx” to the current electricity rationing as it can feasibility be constructed within 12months. ERB Executive Director Sylvester Hibajene has pointed out that thehydro-electricity power stations that we must all wait for will not be coming onstream until 2013 and the country cannot possibly afford to wait until then andcontinue the unpopular load-shedding in the interim.

“We are proposing this new generator because continued load-shedding will

discourage investment and lack of investment can affect the new power generationprojects.” As a project, it has of course to be considered strictly on its merits butis a refreshing proposal in any otherwise barren landscape and opens the way towhat should done more.

Not that HFO hasn’t got its down side.

It is a fossil fuel derivative. Its cost uctuates with that of crude oil and thereare suggestions that reliance on it was a factor in escalating production costsat defunct Kapiri Glass whose furnaces were red by HFO. The proposalnevertheless opens the way to what ought to be done more-practical suggestionson the way forward in order that there begins to emerge a blueprint on the wayforward preferably based on alternatives to hydro-power.

Hydro power is of course the long term solution. But the short and mid termsremain un-provided for and the already fragile economy can only suffer as italready is as a result of this gap. Would for instance, the costs of “domesticating”solar energy, a resource that is in abundance exceed the costs for the constructionof new hydro power stations? Properly harnessed, bio-gas for instance wouldopen the way to rural electrication of at least some areas without drawing on the

main national electricity grid.

It is in a mix of energy sources and there are several, where salvation lies. Thepolicy framework and package of incentives should begin to more seriouslyreect this strategic reality and also the urgency of the matter. The dearth of new approaches and the clinging to hydro-power in the manner of one, who isdrowning, won’t help. It will be interesting to see the kind of hearing that the ERBproposal will receive. But whatever it will be, the crying need is for more “savvy”approaches to a shortage that can’t be wished away.

Energy: A New Idea (At Last)

Religion - Pentecostals Mark Declaration of Zambia as

a Christian Nation

From page 9




Executive Issues

News

JAPHET AARON BANDA

[1943-2008]He handled sensitive cases with precision, calmness and composure

High Court Judge Japhet Banda (65) was killed in a road accident on theGreat North Road on the night of December 18, 2008.

He died on the spot from head injuries sustained in a head-on collision witha vehicle traveling in the opposite direction. Four other people were reportedkilled in the same collision. He was judge in- charge at Ndola and was returningto that city when the accident occurred between Kabwe and Kapiri-Mposhi.

Mr. Justice Japhet Aaron Banda had worked for the judiciary since 1971when he entered service as a “lay” magistrate following his completion of aone-year magistrates’ court at the National Institute of Public administration

(NIPA) in Lusaka. Subsequently, he obtained a law degree from the Universityof Zambia (UNZA) in 1980.

He was admitted to the bar 1981 before returning to judicial service asResident Magistrate. He served successively as Senior Resident Magistrate,Principal Resident Magistrate and Deputy Registrar.

He was Registrar of the High Court for three years up to 1991. He wasCommissioner of the High court from1991 until his appointment as Judge of the High Court on January 13, 1994. He served for the most part in the NdolaHigh Court rising to Judge-in-charge before his untimely end.

He was a widely respected judge as eulogies from among others, the Law Association of Zambia who said of him that “he had been on the bench for along time and was one of the most experienced Judges this country has ever had.”

It was he who presided over the last treason trial in which about 55 soldiersfrom the Zambia Army including the late Captain Steven Lungu, morepopularly known as “Captain Solo” faced charges of unlawfully attempting tooverthrow the Government of President Frederick Chiluba by a coup d’etat.Most received the mandatory death sentence.

He served as chairman of the Law Development Commission and in 1997 aschairman of the commission that inquired into Torture in Zambia. He had beena member of Administrative Inquiry into the Administration and Conditions of the Prison Service.

He born in Chipata on September 15, 1943 and educated at ChizongweSecondary School before enrolling in 1963 for a teachers’ course at MalcolmMoffat Teachers’ College, Serenje.

Chief Justice Ernest Sakala told the Joint valedictory session of the Supremeand High Courts held in Ndola that the late judge “handled cases despitetheir sensitive nature with precision, calmness and composure of mind. Inhis life as a judge, he added great value to the bench, which only posteritywill judge.”

President Rupiah Banda described him as “a fearless judge who spared noeffort to defend the constitution and the rule of law,” he declared. At the timeof his death he had attained the statutory retirement age but had been readily

granted a three-year contract by the President on account of his record.

He was buried in Ndola, December 23, 2008.

MHSRIP

Emmanuel Kasonde

[1935-2008]Twice Zambia’s Finance Minister, Emmanuel Kasonde was eleven days shortof his 74th birthday when he died rather suddenly at the Trust Hospital in Lusakaon December 12, 2008. He had been born at Malole; Kasama on December 23,1935 and like many of the brightest of his generation was educated at MunaliSecondary School and started his working life in the colonial administration as aLabour Ofcer.

He was to rise to the top position of Labour Commissioner after independencebefore being appointed the rst Zambian Permanent Secretary at the Ministry of Finance.

He left the public service to go into business in 1971 and built one of the earliestZambian-owned business empires around his Century Holdings Ltd. He seemed

to enjoy the challenges of business and was totally immersed. Unlike many withhis background he seemed genuinely apol itical and for many years kept whatever political judgments and views he may have had to himself and rarely volunteereda political opinion publicly.

For the duration of his life he was more of a technocrat than a politician. A genialman with a kind disposition, he was well liked and respected by many who knewor met him. For much of his time outside the public service, he alternated betweenrunning his businesses and his farm in Malole. His joining what was then thenewly formed Movement for Multi-party Democracy(MMD) gave the party atremendous llip and had the effect of conrming it as a serious and respectablenational political movement. It was only after he had joined the MMD in 1990that he ventured perhaps his rst ever public political utterance and it was apassion plea to Zambians to “put a new man in State House.” It is a messagethat readily and easily resonated throughout Zambia at the time.

In the historic October 1991 general election that marked the end of the oneparty state in Zambia he was elected Member of Parliament for his homeconstituency of Malole and was the natural choice for Finance Minister in thenew MMD government. It was he who largely laid he groundwork for the changesin economic policy that were to follow and given his business backgroundand his having served at the top administrator at the Finance Ministry, he waseminently suited for the role.

For reasons that remain unclear but would seem connected to fear of his stature,he unexpectedly lost his cabinet post in a reshufe. For a time, he joined thenew opposition party, the National Party. He did not however take too active a

part in the affairs of that party and seemed to retire back to his businesses whichwere now largely ravaged by the effects of the Structural Adjustment Programme(SAP) that his successor at the Finance Ministry Ronald Damson Siame Penza was now prosecuting with religious fervour. He returned to the Finance Ministryas Minister in 2002 following the election of the late President Levy Patrick

Mwanawasa. The country still needed a man of his stature and background for that position. Kasonde obliged.

It was a short-lived and it would seem unhappy stay for a variety of reasons.He departed not a particularly happy man at the turn of events. Only at thistime was there a hint of bitterness from this man who seemed in control of hisemotions throughout his life. But typically, it did not last. He again retired to hisown exertions away from the limelight. Except for his time in public ofce, he liveda quiet private life, minding his business quietly. He was a devote Catholic and

for most of the later part of his life, a widower although he later remarried at aquiet ceremony. He was buried in Malole on December 16, 2008. In his passing,Zambia has lost a gentle giant of a man-one who would have had it fallen to himled this country with quiet competence.

MHSRIP.

Obituaries


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Volume 7 - January 2009News

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The decision left Zambia’s reputation, record and credibility very much in tatters and it will require plenty of time and skill to repair.

Until December 12, 2008, the mood was upbeat: effusive government assurances that Zambia would go ahead to host the 10th All-Africa Games in August 2011 came thick andfast; there was much shufing of feet and more assurances that a cabinet committee overseeing the preparations was hard at work.

At the close of a three day consultation on the games held in Lusaka’s Mulungushi Hall at the end of November 2008, Zambia was pronounced to have demonstrated the

requisite “political will” to host the games. But that is precisely what seemed to rapidly zzle out leading to the surprise withdraw. It came completely against the run of events.Zambia seemed to be warming up to the task and when the shock announcement came: “Government,” said the Chief Government Spokesman, Information Minister Ronnie

Shikapwasha, “has prioritized its spending plans for 2009 to 2011…to concentrate on a few important programmes. Unfortunately, the hosting of the 2011 All Africa Gamesis one of the programmes that have been affected.” He said government had decided to shift resources for the hosting of the games to identied priority areas such as foodproduction, provision of social services, housing and construction of infra-structure.

With that, Zambia baulked.The decision sent many sports associations reeling, their plans in disarray but more importantly the only sure means of leveraging public fundseven for what could be doubtful causes had been removed! But crucially the decisionleft the country’s reputation, record and credibility as a potential host of a Pan-Africansports event very much in tatters and it will require perhaps plenty of time and certainlya lot of skill to repair. Zambia was throwing in the towel for the second time making her among the most unreliable of would-be hosts on the continent. She reneged again in1988 when her effort to stage the nals of the soccer Cup of African Nations, would not

go beyond the destruction of Dag Hammarskjold stadium in Ndola!

This time at least, there has been an undertaking to continue construction workassociated with the games at the University of Zambia and other educationalinstitutions around Lusaka for which contracts have already been entered into and if its worth anything, it has also been said possibly for the 100 th time that the rehabilitationof Independence stadium in Lusaka will proceed. In justifying the pull-out, great playwas made of reduced government revenue as a result of the global nancial crisis,costs associated with the presidential by-election of October 2008, the K600 billionthat must be found for the scheduled general elections in 2011 and the absolute needfor government to reassess the situation in the light of changed global economicrealities.

Most of it true of course. But it was also a convenient smokescreen. Zambia’s capacity

to host the games even at the best times was near zero. She solely lacks the sportsinfra-structure to stage such a large and diverse event. Most facilities would have hadto be built from scratch and even with increased revenue from mining it was going tobe strenuous and perhaps ruinous even. Further, hosting such an event in a neglected,run-down city with broken-down roads and other infra-structure such as Lusaka issteadily becoming and would only have amounted to self-insult.

The games were realistically always a bridge too far. The question is why anybodywould have thought them possible. The cost would have been debilitating. It keptrising, at the last count it was conservatively estimated at K800 billion! It was setto escalate even further. Zambia found itself under the same pressures as in 1988.Then as now cost was the elephant in the room and there was no way of evading it.Ultimately, it was the question of cost that forced the climb-down.

There is a penalty for withdrawing and it is not necessarily an insignicant amount. In1988, it raised eyebrows. But from whatLt-General Shikapwasha had to say Zambiahas all but opted for the ne. But even though the towel is well into the ring, there arequestions about this whole episode which go to the heart of how decisions are made inthis country. The reasons advanced for withdrawal were from the outset self-evident topretty much everybody except perhaps government. How did the decision or perhapsmore accurately, pretence come about? No consultation or evaluation appears to haveoccurred. Thus the announcement that it would be Lusaka in 2011 came as a surpriseeven to Zambia National Olympic Committee (NOC) which said it was unaware thatZambia had put in a bid. There are suggestions that hosting the games was in somekind of exchange for the election of Sonstone Kashiba until then Director of Sport for Zambia to the position of Secretary –General of the Supreme Council of Sport in Africa(SCSA), the body with responsibility for the games.

Two things have happened as a result of this climb down. First, Zambia has givenitself a really bad name in continental sport and for no good reason. Second, the

Government has not shown itself to be cohesive, able to evaluate andcoordinate the decisions of its various arms. Instead the picture is one of a setup where random and questionable decisions requiring a second lookcan be entrenched!

Throwing in the Towel - 2011 All-Africa Games

Executive Issues - January 2009

Documents

Transcript of Executive Issues - January 2009