Stop making ‘shopping’ list from borrowed funds which you could have raised from windfall taxes- PF told

Filed under: Breaking News |

UPND Bweengwa MP, Hyve Hamududu, says the PF have chosen a more expensive option by borrowing through the recently acquired Eurobond when they could have raised the same or more money if they had implemented the windfall tax on mines which they promised.

And the Bweengwa parliamentarian said it was wrong for the PF to pre-determine where the borrowed money will be spent without approval from parliament as the money was not a PF party project funds.

Last week, the Zambian government borrowed $750 million through a Eurobond that pushed the country’s external debt to more than USD 2 billion and 250 million.

Mr. Hamududu, who is an economist, said the PF government missed the opportunity and a better option of raising through windfall taxes the USD750 million from the high mineral prices within about 5 years without contracting a 10 year-debt that future generations will have to pay.

He said there may not even be a guaranteed of honouring re-payments for the contracted debt within 10 years, especially if mineral prices go down, thereby putting the country at risk of defaulting and paying more money.

On the usage of the borrowed funds, Mr. Hamududu said it was wrong for the PF party to make a ‘shopping list’ of items to be ‘bought’ from the money to the exclusion of others because every Zambian will have to bear the debt burden.

He said the borrowed amount constitute a national treasury and not PF party project funds hence the expenditure should be agreed by people’s representatives across the country.

Several PF leaders have been ‘drawing shopping lists’ of items to spend the money on without parliament approval.

Late president Levy Mwanawasa and his finance Minister Ngandu Magandu laboured succesfully to remove Zambia’s $7 billion external debt which was accrued mostly in the first ten years of the MMD rule.

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36 Responses to Stop making ‘shopping’ list from borrowed funds which you could have raised from windfall taxes- PF told

  1. I agree totally this country has gone to the dogs whoof whoof whoof

    fairlady - September 18, 2012
    14:28

  2. MPS AND CIVIL sOCIETY SHOULD RAISE UP TO THE OCCASION AND ENSURE THAT THIS EURO BOND U$750M SHOULD NOT USED ANY HOW BY PF LEADERS DECIDING ON WHAT IS TO BE SPENT. LET THAT MONEY BE PARTY OF 2013 NATIONAL BUDGET SO THAT ITS CHANNELLED TO PRODUCTIVE SECTORS. ITS NOT PF GOING TO PAY BACK THIS LOAN BUT ALL ZAMBIANS. GOVT LEADERS SHOULD NOT GET EXCITED ABOUT THIS NKONGOLE THE WHOLE PROCESS WAS NOT NECESSARY WE COULD HAVE RAISED LOCALLY.HOW CAN A NORMAL PERSON CELEBRATE AFTER BORROWING MONEY FOR CONSUMPTION?

    ANIMAL FARM - September 18, 2012
    08:50

  3. Excellent thought HH

    crisM - September 18, 2012
    08:41

  4. Why is it that after failing to run the nation,PF is trying to hide in MMD.These are the tricks of Sata.this man was stealing with Chiluba yet raising his hands up as clean.PF shud not say it was MMD’s plan.meanng you are also dead heards,

    LWIINDI-UPND - September 18, 2012
    08:39

  5. Nowonder Ka GBM is is happy this days.kaili nakeshiba ati tendalama shabanoko shileisa

    MR KISS - September 18, 2012
    07:20

  6. only a foolish man would celebrate inkongole with his children. How on earth can a normal person dance after getting a debt? Debt shd in fact sadden u in a way.

    Kapiji mema - September 17, 2012
    23:54

  7. quite interesting…..if dont have windfall tax then where do the govt hope to raise the revenue to pay back this debt?? it will simply mean more taxes for workers!! less money in the pocket! maybe they know they’ll re-introduce windfall tax to pay back the debt or seriously reduce govt spending, otherwise we are seriously doomed as a nation!! Thats why PLANNING is important. “failing to plan is planning to fail”!!

    cult hero - September 17, 2012
    21:41

  8. #mwamoneni, you seem to be ignorant of HIPC. It was accomplished in 2005 by Levy and Magande not in 2000. Learn to ask if you do not know.

    Mwine - September 17, 2012
    20:46

  9. What HH is saying is true, borrowing is not bad, you do it only when you cannot raise funds using your own resources. PF has started on a note of MMD government of Chiluba where Sata was number 3 and chief advisor. The government of Chilua left a lot of debts due to poor planning and we thank God that after 10 years mwanawasa and Magande managed to pay off these debts, hence the country need to listen to magande now as a man of experience. During Levy’s era we saw the economy grow without grz borrowing to much from the international community because the man had a plan to develop the country. By the time pf leaves, the country will be full in debts. Zambians to be honest, where the money finishes is at foreign affairs and look at on the budget on this ministries and its brunches (embassies). Usually this ministry use to have a program of how many people it needs to recall from missions abroad each year, but the program is not followed because cadres have now occupied these missions. The PF government recalled almost 50 diplomats who were serving in missions as pretext to send civil servants in the name of cadres with 5 year contracts. Each cadre attracts average U$50 000 and the same cadre after service is paid gratuity at home which gets close to ZK50 to 60 Million. The gratuity does not apply to civil servants because they in service already, therefore this sending of cadres in missions aboroad has costed the country a lot of money in gratuities. Sending and transfering of diplomats is what Levy reduced thats why he was able to save money because he use to listen. At the time of levy the only diplomats who were recalled and it is a must were Ambassadors and their deputies because these usually are not civil servants. Now all well meaning zambians should calculate the Us$50 000 by 50 diplomats then multiply this number by K50m. You will realise that all this money could have gone to constracting one road and even improve health facilities or buy medicine in hospitals. PF really has no plan for the nation, a government which has a plan for the country would first look at resources available and allocate according to needs of the country.

    Mwine - September 17, 2012
    20:40

  10. Thanks Hamududu for sane comment. I expect all elected members of parliament to pursue this to the end. No borrowed resources should go into pockets of greedy individuals. Indeed, why borrow from an expensive source when the country has its own resources?

    Mapanza H Nkwilimba - September 17, 2012
    20:11

  11. Don’t borrow if you don’t understand anything. These chaps want to burden incoming government with debt hangovers from unprincipled clueless government. Oh! Now I know this is the same money Edith is waitng to get share from. Oh! Rubbish.

    ndendeule dance - September 17, 2012
    19:37

  12. Thieving tactics at an international level. Create kongole for zambians and steal it for the the Auditor General won’t know where it comes from. In the meantime fight corruption for what they can account for. Once a thief always a thief. Find out from those who know what is going on in the Ministry of Defence. This is a ruined Nation.

    Advocate - September 17, 2012
    19:20

  13. I agree with UPND on this. Parliament should be involved in the decision making of how the funds wil be utilised.

    Rb - September 17, 2012
    19:04

  14. Just look at the way the UPND analyse and articulate issues imwe. ALL of them! They dialogue, agree and move. God and education are key.

    This party is the way FORWARD imwe!

    As for PF, I’m afraid i’m also seeing mismgt of this money. Mabvuto.

    Spyglass - September 17, 2012
    17:51

  15. Spot-on Honourable Hamududu! The projects upon which the proceeds of the Eurobond are to be expended on must be decided by the people’s representatives in Parliament. Our legislators must ensure that the debt is spent on genuine infrastructure development and not on consumption!

    Shi Mwana - September 17, 2012
    17:26

  16. I dont agree with Crazyboy. Chiluba did not even know what was happening actually. He had thrown in the towel and thats the reason he started stealing.He could not see any light at the end of the tunnel. Of course not forgeting his endowed stealing behaviour by nature.

    Mweru wa Ntipa - September 17, 2012
    17:00

  17. Is getting Kaloba positive when you can raise the same amount from your resources? This is a sign of laziness and trying to appease people unnecessarily. @ Sansamukeni, please understand simple economics.

    Mweru wa Ntipa - September 17, 2012
    16:54

  18. This whole process started from RB n the PF neva cancelled it coz it will benefit the whole country!If the Bond issue had failed, u clowns wud av bin the 1st to celebrate!Now that it has succeeded, that aint gud enuf 4 u!!!The best we can all hope 4 is that the money is chanelled 2 activities that will benefit all Zambians!Lets mek the Govt accountable 4 every dollar borrowed n we shd see development at the end of the 10yrs 4 which it has bin borrowed

    Ba Zed - September 17, 2012
    16:36

  19. @Crazyboy. You are right. Zambians generally are “blinded” by hatred for Chiluba and deliberately ignore KK’s misdeeds. Our problems did not start with Chiluba but with KK. Our economy collapsed under KK’s watch. Resolution of those problems started from 1991 until our credit rating was revised upward to qualify to for bond markets. Note also that all this happened before PF came into power. The PF just did the easy part…

    Ruff Ryder - September 17, 2012
    16:28

  20. When people say you are all driven by bitterness, envy and jealous you refuse. Is this not positive, are you not the same people who alleged that PF has failed to sell the bond hence sending Deputy Minister of Finance to go and beg in Europe?????

    Sansamukeni - September 17, 2012
    16:21

  21. Can the owners of this website please check their facts about economics properly. I think you are either deliberately lying or simply don’t understand the subject.

    The US$ 7 billion debt was left by KK and, starting with Chiluba and ending with with Mwanawasa, Zambia eventually qualified to have its debt written off by the IMF and World Bank as a result of having met a number of important conditions namely:

    1. Privatisation of the mines.
    2. Repeated fiscal austerity and discipline.

    This was not an exclusive undertaking by Mwanawasa. If anything, Chiluba probably deserves most of the credit because it was he who took the really tough measures to restructure the economy ahead of qualifying for the Highly Indebted Poor Countries Initiative (HIPC) which preceded the writing off of Zambia’s debt.

    He was a crook and all round villain for sure. But, nobody can deny Chiluba his due for the role he played in having Zambia’s debt written off.

    Crazyboy - September 17, 2012
    16:13

  22. Zambians blame yourselves for all things happening in your beautiful country. Its you who did it and you are the same to un do whatever you did

    Ruth Hams - September 17, 2012
    16:00

  23. It sounds funny when one is in opposition talking a lot and when he comes into power he denies others to talk. This is a timing bomb PF is playing. The recycled UNIP with by air mentality has come into power and will push Zambia very backward. These guys are not farmers not even domestic gardeners what do you expect from them?

    Sound - September 17, 2012
    15:47

  24. Corrections to article

    HIPC was accomplished in December 2000 by the Chiluba regime.

    By 2nd January 1991 Zambia’s external debt was already US$7 billion. Ask Kenneth Kaunda.

    Current external debt is $3.5 billion and domestic debt is also $3 billion.

    Mwamoneni - September 17, 2012
    15:37

  25. UPND has great brains indeed.

    Mantebe - September 17, 2012
    15:27

  26. Now that the Eurobond ‘cash’ is here, let parliament show us their oversight role. This money is coming at a time when most Zambians are economically literate. We should ALL collectively make the Govt accountable for every cent!!!!!

    Kaliza - September 17, 2012
    15:24

  27. PF did not decided to borrow from private persons, this plan was laid down by MMD. and it was and is a good plan. i don’t like PF but i wont lie about them.

    Global citizen - September 17, 2012
    15:23

  28. first of all do they know that it is nkongole that needs to be paid back with interest. somebody needs to tell them ka. they are making shopping list… typical of pf. they think ni gift… ati mo manne in yor poketiiii!!??!! kansi ni nkongole or maybe ni kaboba?

    preety woman!!! - September 17, 2012
    15:20

  29. what do you expect from ba CNP. first they make the nation celebrate without knowing what this eurobond is all about. we thought it was some grant or foreign investment as it was potrayed as a big achievement for the PF gov when actually it is nkongole. can we boot this government out before we find ourselves in a $7 billion debt just like their now mentor KK put us into.

    PaFyamba Party - September 17, 2012
    15:06

  30. good sense, we need to respect the whole country, not just making pronouncements on issues that need parliament approval. CNP.

    Katundu - September 17, 2012
    15:05

  31. Being led by blind govt.CNP govt will lead us into big debts.

    Phil - September 17, 2012
    14:49

  32. What do you expect from CNP arrangement. This venture will cost the country dearly. These guys are just looking at awarding contracts to themselves not what they are talking about.

    gAutocat - September 17, 2012
    14:47

  33. The end of PF is near. This pam fi kaponya govt shld be booted out this yr

    Diaspora - September 17, 2012
    14:46

  34. What do you expect from CNP arrangement. This venture will cost the country dearly. These guys are just looking at awarding contracts to themselves not what they are talking about.

    Autocat - September 17, 2012
    14:46

  35. These. Haps will steal that money watch this space

    London - September 17, 2012
    14:43

  36. sense. next commerce minister

    big charlie - September 17, 2012
    14:40