ERB SHOULD REDUCE FUEL PRICES

A LOT of issues needing attention have arisen in the past one month or so.

Since October 10, 2014 when Finance Minister Alexander Chikwanda presented the 2015 national budget to Parliament, many other issues  have arisen and, therefore, we could not do full justice to the proposed budget.

Within the proposed budget there are many contentious issues which  call for attention but the entire national document was overshadowed by the commemoration of the country's Golden Jubilee.

Presented on October 10, exactly a fortnight before the main Golden  Jubilee celebration on October 24, the proposed budget had to, obviously, be shelved as we focused our attention on the 50-year
commemorations.

Just when we thought we would return to the normal calendar, tragedy struck with the death of President Michael Sata on October 28 2014.

 Definitely, whole the attention had to be shifted to that loss and Policy Analysis had to look Mr Sata's personal economic contribution  to the nation in last week's article as a tribute to him.

In the coming weeks, God permitting, we will focus on some of the remnant issues from the year while also glancing at the 2015 national budget.

We will tackle some of the issues which have arisen in the last one month or so and highlight the contentious provisions of the 2015 proposed national budget.

From the proposed budget we will look at issues like the much-talked about proposed tax regime for the mining sectors to try and evaluate its impact on the mining houses and the entire economy.

We will equally look at some other tax measures which have been proposed, targeting various other sectors.

There are seemingly other hot issues like the government's resolve to address the current imbalance on the annual allocation of resources which is skewed towards consumption through the public service workers emoluments.

Given the requests and queries I have been receiving from the readers on the mooted offloading of some of the government shares in ZCCM - Investment Holding to the public, we will have to revisit the issue soon.

Some readers have been asking as to how they can participate in the imminent acquisition of the shares and many other aspect of the ZCCM - Investment Holding shareholding.

 For instance, Mr John Misumbi wrote to me from the Copperbelt Province on October 29 2014 saying:

 "How does someone like me purchase or acquire shares in listed company like ZCCM-HI or any other company?"

This has to be looked at with other related issues.

The current situation following the death of Mr Sata has also raised various policy issues which need to be tackled.

At an appropriate time, we will, therefore, have to weigh up on whether there is a possibility of economic policy shift in the country and some of the pitfalls we need to avoid.

These and many other issues will definitely draw us towards the end of the year when we will have one or two articles summarising the 2014.

 Before that, however, I would like to focus on the Competition and Consumer Protection Act number 24 of 2010 and how it is being  implemented by the Competition and Consumer Protection Commission.

 *****

 Still on the issue of consumer rights, the oil prices on the international market have been falling for some time now and from about US$115 per barrel in June, 2014, they are now hovering around
$81 per barrel last week.

 In some African countries, like South Africa, the reduction in the wholesale prices of oil has triggered drops in the pump prices of petroleum products, as a ripple effect.

 In Zambia, however, the Energy Regulations Board (ERB) has been quiet on the matter and yet it is supposed to ensure that Zambians also benefit from the falling prices of the essential commodity.

This has led to various alert local consumers through the Zambia Consumer Association (ZACA) to call on the Government to address the issue.

The authorities in Zambia should emulate South Africa where the petrol prices recently decreased by 45 cents a litre with diesel prices lowering by 60 cents for every litre.

This was the second reduction in the prices of these essential commodities following the first one sometime back.

Zambian fuel users need a relief considering that the prices of petroleum products in the country are said to be among the highest in the region, at K10.63 per litre for petrol, K10.01 per litre for
diesel and K7.48 per litre for kerosene.

 For comment call: 0955431442, 0977246099 or email: jmuyanwa@gmail.com.

PERSONAL EXPERIENCE WITH LATE PRESIDENT SATA

BY JAMES MUYANWA

DEFINITELY, the current crop of politicians especially the opposition has a lot to learn from late President Michael Sata in terms of handling public gatherings.  

Mr Sata knew how to handle the media – both the hostile and friendly ones – and made sure he got the best in terms of attention out of any public appearance.

He did not allow anyone to subdue his political clout and as a result his speech always had a keen audience.
 

At public debates while in opposition, he made sure he identified himself with the audience, sometimes at the extent of taking on the moderator.

As a moderator you always had difficulties to stay in charge of the meeting where he is featuring.

He had his own way of answering the questions, especially the complicated and sensitive ones. 

I was privileged to host Mr Sata who - while in the opposition - in 2004 appeared during the hardest public discussion I have ever chaired.

Somewhere in May 2004, during my five-year posting in the hub of the Copperbelt, Kitwe, I was elected Kitwe Press Club president.

The mandates for the position included chairing public fora on which we invited dignitaries from the various backgrounds especially politicians.

The fora were both a fundraising tool, as we charged some entry fee for the audience, and a professional platform to bring the leaders and the led together to discuss various issues of national importance.

Our executive committee was like a child born running, as, upon our inauguration, we started planning for these meetings mainly targeting political and labour movement officials.

Between May and August 2004, we had invited the likes of the late United Party for National Development president Anderson Mazoka, Zambia Congress of Trade Unions president Leonard Hikaumba and officials from the two then warring trade unions in the mining sector.

LATE MAZOKA

While Mr Sata’s political esteem in most parts of the country was, by this time, not any better than exemplified by the results of the 2001 general elections when he managed a paltry 3.3 per cent of the total votes cast, on the Copperbelt it was soaring in leaps and bounds. 

That we - as organisers of the discussion – would learn the hard way on the day of the meeting!

My colleagues in the executive committee got in touch with the officials then surrounding the Patriotic Front (PF) president who showed interest in convincing him to turn up for the event.

Throughout the week we kept in touch with them but a day or two before the actual event Mr Sata offered to talk me as “a fellow president,” on phone.

“Mr President how many people are you expecting as members of the audience?” he inquired on phone, catching me napping as we did not even know the capacity of Edinburg Hotel hall.



HIKAUMBA

I vaguely answered before he went on to inquire on specifics like starting time, who would chair and the duration of the meeting.

After assuring himself of our preparedness he told me we would meet on the day of the meeting at 18:00 hours, 30 minutes before the commencement of the discussion.

By 17:00 hours on that actual day, it had dawned on us that we had a challenge ahead of us because the venue was almost full.

By 17:30 hours the place was full with some people sitting right under the high table.

At 18:00 hours, true to his word, he was outside the hotel and called us.

When we went downstairs we found him with a horde of officials who surrounded him with cadres chanting slogans.

He mockingly asked us how the attendance was so far but before we could answer, he started loudly laughing at us saying we had thought he would not attract a big audience.

We had arranged for a room with the hotel management where he could go and fresh up waiting for 18:30 hours but he refused saying, “if the people are already there why should we wait?”

We had troubles to access the high table because there was nowhere to pass as a sea of people had filled up the entire hall including the doorway.

After struggling, we managed to reach for our seats and caught our breaths.

For me, at this point, work had just started because I had to control the crowd which was still swelling with those still outside demanding that a bigger venue should be quickly found because they could not manage to miss the discussion.

Further pressure emanated from my guest who was busy exchanging pleasantries with the members of the audience even before the meeting could start.

After delivering his unwritten statement for about 15 to 30 minutes we went into question-and-answer session, which proved even more challenging.

More challenging in the sense that I would be picking  a set of questioners on one side while Mr Sata would also be busy on other side saying:

“Iwe mwandi njipusha, ninshi tabalekusontela?” (You, I ask me! Why are you being sidelined?)

The bombshell for us, however, was yet to come.

As a way of enhancing our operations as a club we had designed pledge forms on which members of the audience would fill in indicating their support in cash or in kind.

For some reasons, when I was approached by one of my fellow leaders, I advised that on that day we should not pass the forms round but being a democrat they carried the day since I was the only one who objected and had no convincing reasons. 



I don’t know how the pledge form caught Mr Sata’s eyes.

“What is that form for? Pledges?” he rhetorically inquired and without waiting for the answer, he publicly directed Mr Charles Chimumbwa who was, I think, party national treasurer or secretary at the time, to contribute K2 million (now K2, 000).

LATE SATA

Mr Chimumbwa publicly announced that he would hand over the money the following week on Monday and one of us should travel to Chingola where he was based.

That stirred hullabaloo against us by fellow professional, then ruling MMD officials and other people who accused us of having been bought by the PF.

Before we could address the accusations we had to deal with the immediate issue of whether we should go and collect the money and after a heated debate we resolved to get it since it was publicly offered to the club and there was no strings attached to it.

For Mr Sata the meeting was an opportunity well utilised to effectively sell himself and his party by convincingly answering all the questions posed to him amid some public relations chores.

For the club, however, somebody had to pay the price of organising such a successful meeting, featuring an opposition leader and I think I paid a full price, which is, however, not the subject of this article. 

SATA: INSIGHTFUL ECONOMIC THINKER

ALTHOUGH he had no known advanced professional qualifications in economics, he showed deep understanding of economic issues.

His economic strategies looked like wishful thinking or indeed mere daydreams when he espoused them while in the opposition.

Yes, President Michael Sata astutely understood economic concerns, albeit with preoccupation on how the economic achievements could
benefit Zambians.

To some learned experts his economic arguments, at first, may not have looked sensible as they were, seemingly, contrary to what they read in the books of renowned authors like Adam Smith, who is considered to be the father of modern economics.

I remember calling him in 2008 for a story on the foreign exchange market and what he would do on the performance of the Kwacha, should he one day rule Zambia.

In his typical manner, instead of directly answering the question, he first lamented as to why the Zambian Kwacha was relatively the weakest currency in the region.

He said Zambians parted away with stacks of money when exchanging the Kwacha with any other currency in the region.

As a panacea, he said there was need to (I cannot remember the actual word used here) rebase the Kwacha to make it stronger against other currencies and once in power he would do just that.

Some economic experts I contacted to balance up the story scoffed at him.

Upon winning the elections, I believe his duty was now to champion the Kwacha rebasing idea among his ministers, some who could have had doubts on its feasibility.

In January 2012, Finance Minister Mr Alexander Chikwanda announced that Government was going to rebase the Kwacha by cropping off three zeros and introduce coins for lower-value denominations.
                                      

So, effective January 1, 2013, Zambia has had a rebased Kwacha.

At one time while campaigning in Old Mkushi, Mr Sata told the people of the area, which he would later declare Luano District, that once elected he would take economic development closer to the people by creating more districts.

By the time of his death, Luano and 31 other areas were being transformed into fully-fledged districts.

In 2008 I covered him during his campaigns for the presidential bye elections of that year in Mkushi and Kapiri Mposhi, where he told the people his government would recapitalise the TAZARA and Zambia Railway Limited (ZRL) networks.

The ZRL network is being turned round while for TAZARA, it was just a matter of time.

On-going projects, including the imminent reopening of Kabwe's Mulungushi Textiles sounded like mere fantasy some four years ago but now they are a reality.

In all these projects, Mr Sata's major aim seemed to have been the creation of jobs while ensuring economic sustainability.

He seemed to have understood that sustainable jobs could only be attained once the economy was buoyant and shunned quick-fix job creation policies.

In areas like banking, his main objective seemed to have been to ensure the people of Zambia fully benefited from the operations.

As I wrote in September 2013 in a tribute towards the Patriotic Front (PF)'s two years in government, the Central Bank seemed to have become a critical driver of change and recorded undeniably more innovations than any other government wing.

By December 2011, the BoZ had revised the minimum statutory capital requirement from K12 million or US$2.3 million to about K104 million for local commercial banks and to about K520 million or $100 million for foreign banks.

The reserve ratios for both local and foreign currency deposits were reduced to free more funds to the banks for onward lending.


It introduced the Cheque Truncation System (CTS) for all commercial banks to reduce on the period of encashment.

Mr Sata's main headache in this sector was the sky-rocketing interest rates and the access to the finances by Zambians with no collateral security.

We, therefore, saw government's reduction of the corporate tax for the commercial banks from 40 per cent to 35 per cent, provided a K65-million relief to banks under the 2012 National Budget.

This was in the hope that banks too would pass that to the borrowers through reduced lending rates.

The BoZ remained systematic on the matter and introduced the Policy Rate in March 2012 which helped to cap the lending rate.

At first, the BoZ policy rate was vague as its effect on the market could not be quantified leaving everyone confounded as to its importance.

But soon, the scenario was to change with the use of the policy rate to cap the lending interest rates being charged by the banks, making borrowing more affordable, but with room for improvement.


Later, a similar move was made on non-bank financial institutions on January 3, 2013, prompted by the extortionate interest rates some institutions had continued to charge their customers.

In all these measures, the government wanted to ensure that splendid economic indicators for the country have a bearing on the living standards of the people.

Previously, these indicators were mere statistics and somewhat contradictory to the standard of living for the people who became poorer amid splendid statistics.

The situation is now different because of the policy measures by the government under Mr Sata who, apart from having been a shrewd politician, proved to have been an insightful economic expert.

For comment, call: 0955431442, 0977246099 or email: jmuyanwa@gmail.com.