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Monday, 29 November 2010

Inflation Statistics - November 2010

The annual rate of inflation, as measured by the all items Consumer Price Index (CPI), reduced to 7.1 percent in November, from 7.3 percent in October. The 0.2 percentage point decrease is attributed to the "reductions in the cost of some food items". More detail via the CSO Monthly Bulletin.

Friday, 26 November 2010

Mining Taxation Debate (A Response to Kyambalesa), 2nd Edition (Guest Blog)

I think we all agree here that – when it comes to extractive resource which has finite lifespan, the thing to do is to maximize earnings from that resource and develop alternatives before it runs out. Copper and other minerals will run out, what happens then? Why are our current officials so adamant about the re-introduction of windfall taxes? Don’t they understand what is at stake? Why are they refusing to increase copper revenues when the prices are good?

Many people have counseled that we should levy these windfall taxes. Chares Milupi, Bob Sichinga and others have talked about it. Even some important cooperating partners like the US Embassy and IMF have also suggested that we should go for it. Nej, our people don’t see it that way. Here in Canada, Potash a strategic resource based in Saskachewan, has been protected by Federal government from aggressive (hostile) takeover by foreign companies. In other words, national interests superseded international open business concerns.

Thursday, 25 November 2010

The Constitution of Zambia (Amendment) Bill 2010

The Government has published the Constitution of Zambia (Amendment) Bill 2010 which will take forward the enactment of specific clauses which are not subject to the referendum. The public has 30 days to study and engage their parliamentarians before it makes it way into the House.  

The object of this Bill is to amend the Constitution of Zambia so as to—
  • (a) revise the Preamble to the Constitution in order to recognise the multiethnic and multi cultural character of Zambia, to honour and respect freedom fighters and ensure that all powers of the State are exercised for sustainable development
  • (b) provide for the right and duty of citizens to protect the Constitution and to compensation for punishment or loss arising from the defence of the Constitution;
  • (c) repeal and replace Part II in order to re-assert the status of Zambia and declare its sovereignty, national symbols and official languages;
  • (d) revise Part IV in order provide for the determination of election petitions by the Constitutional Court;
  • (e) repeal and replace Part V in order to revise the composition of the National Assembly, establish a proportional representation system and establish the Parliamentary Service Commission;
  • (f) repeal and replace Part VI in order to provide for the establishment of the Court of Appeal and the Constitutional Court and revise the jurisdiction of the superior courts;
  • (h) revise the provisions relating to national values, principles and objectives and the directive principles of State policy;
  • (i) revise the provisions relating to citizenship in order to permit dual citizenship and revise the modes of acquisition of Zambian citizenship;
  • (j) revise the provisions relating to local government in order to effect structures and principles of a decentralised system of government and provide for the determination of election petitions by a Local Government Elections Tribunal;
  • (k) establish the Political Parties’ Commission and Political Parties’ Fund;
  • (l) make provision for investigative commissions, establish the Gender Equality Commission and provide for the enactment of legislation for the establishment of a National Prosecution Authority;
  • (m) introduce provisions relating to a code of ethics and conduct for public officers and declaration of assets and liabilities;
  • (n) revise the provisions relating to public finance and budget, establish the National Treasury Account and the Compensation Fund and provide for the enactment of legislation on budgeting and planning;

This is the first of two bills to be published. The second one "The Constitution Bill" will be available tomorrow.  I encourage you to read these bills and provide comments on them. If we get enough comments and I have enough time, I may collate and forward them to the Clerk and associated players, like we have done in the past. I suspect that will be around early January (since I go on "blogging leave" next week).

Wednesday, 24 November 2010

And another thing...

Management of Collum Coal Mine and all the 13 workers who were shot at have agreed that their supervisors should not be prosecuted. This comes after mine management agreed to compensate victims of the shooting between K20 and K45 million.
There's something wrong in a country where the State allows witnesses to be bought off (that is what "compensation" is) before formal criminal charges are brought. The Collum incident was not a civil offence, it was an alleged "criminal" act. That is to say the alleged offence was committed both against the State and the individual. The alleged offence therefore is not a "private deal" between the victims and the alleged offender. A responsible government is supposed to do three things. First, protect the victim and ensure they are not approached or tampered with in any way. Secondly, institute formal criminal proceedings against the alleged offenders, with or without the witnesses, where such a case is in the interest of justice. Finally, after the criminal proceedings have been completed encourage individual victims to pursue civil law suits. It appears we are already at stage three!

In a country where we prosecute people for bouncing cheques, I find it bizarre that shooting someone can be handled through a financial deal between the alleged offender and the poor employee. If it was all a matter of money, the rich (not just those from east bearing gifts) would never face criminal prosecution. 

At this point we must surely ask - is the criminal process in Zambia just for alleged poor offenders?

Where are Zambians who will stand for justice to prevail in our land?

Tuesday, 23 November 2010

Are you in the UK?

A special event in London this Friday by STAR 100 a professional Ghanaian network. Among the speakers is the excellent Standard Chartered's Razia Khan and Oxford University's Rick Van Der Ploeg. Well worth attending!
Star 100 UK - Oil & Gas : Creating a Success Story for Ghana

The Collum saga, revisited

Since the shooting, Zambia’s labor commissioner, Noah Siasimuna, has been drawn into the dispute. Atop his desk is a thick folder about Collum Coal, but most of the paperwork is new. No signed labor agreement with the company was ever filed with his office as required by law, he said. Nor did the unions formally report any noncompliance.

Mr. Siasimuna, like the labor minister, Mr. Liato, cautioned against any conclusion that impugned Chinese businesses as worse than others. “We have bad employers that come from everywhere, including Zambia,” Mr. Liato said.

The unions, however, say Chinese owners are indeed their biggest headache. And, contradicting the government, the president of the Gemstone and Allied Workers Union of Zambia, Sifuniso Nyumbu, was able to produce contracts with Collum that had the signed and stamped approval of the commissioner’s office as well as letters from the Labor Ministry acknowledging union complaints about the company..
Excerpt from this recent New York Times piece on the Collum saga.  Taken at face value the above suggests that the Labour Commissioner would do anything, even lie, to protect Chinese owners. That is quite worrying considering that Chinese firms employ at-least 25,000 employees. Can those employees expect an impartial assessment from this Labour Commissioner? Not on this article!

Government media in numbers

I was delighted to see this question following the piece - Yes, let us sell failing parastatals! :
Information and broadcasting services deputy minister Angela Cifire has said the public media in Zambia is doing very well in newspaper circulation.

Ms Cifire said this in Parliament today when answering a question from Kachibiya Member of Parliament David Mwango who wanted to know how many copies of the Times of Zambia, Zambia Daily Mail, sold in the year 2009. Ms Chifire told Parliament that Times of Zambia in 2009 sold 2, 982, 211 copies while the Zambia Daily Mail sold 2, 239, 388 copies. The deputy minister further revealed that the Sunday Times sold 248 237 copies while the Sunday Mail sold 684 847. 
How is this doing well?

The best case scenario is to assume that Times of Zambia figures excludes Sunday Times. That means 2,982,211 divided by (52 weeks x 6 days) =  9558 per day. The Sunday Times figure can be obtained by 248237 divide by 52 sundays = 4773 per sunday.  I will leave others to speculate why the Sunday Times sells twice as less, but I think it is because govt is the largest consumer of it's own product! When offices are closed on Sunday no one buys except cadres! These are papers by government employees for government employees. What a waste of tax payers' money!

Now from what we have been told the Post ships 50,000 plus a day at the same price of K3,000 per copy as other dailies. When all things are put together it makes for a very ignorant Deputy Information Minister. I think I can now understand why she was demoted as Minister of Health. 

Monday, 22 November 2010

Lusaka Basic Needs Basket - October 2010

The latest Lusaka Basic Needs Basket and the associated press release for October 2010. In October the basic needs basket for a urban family of six stood at K2,877, 830 (or US$589).
Lusaka Basic Needs Basket - October 2010

Sunday, 21 November 2010

Collective inaction

In a recent debate on Road Traffic (Amendment) Bill which seeks to increase road tax by 50% a few parliamentarians echo arguments we have previously advance on infrastructure development :
"The heavy-duty trucks from South Africa, Namibia and Botswana are the ones destroying our roads but are paying nothing as they travel to Lumwana mine...Why don’t we put tollgates on our roads? These trucks are destroying the whole road from Livingstone to Solwezi. We could collect money from these road destroyers by simply applying the law. Why don’t you government want to collect money?"
- Hon Muntanga
"Why are we so kind to the mines? In countries where they come from, those involved in the mineral extractive industry pay up to 65 per cent in tax and here they want a tax break....When are we going to be rich? As a government, we should not feel pity for those mines...Maybe our generation has no potential to stand up to guys with money and we should leave it for our children"
- Hon Shakafuswa
It sounds like Hon Shakafuswa feels like he is banging against the wall, but realism demands we remember that he was once a defender of mining companies. The main point of course is that the proposed increase of the road tax demonstrates the importance of collective action (or inaction). The reason the government has failed to act on mining companies but is able to increase road tax is because the "drivers" are not as organised as mining companies. One has a powerful lobby the other doesnt. Which explains why Hon Muntanga's cry for the road tax to reflect the marginal cost imposed by various users will find no active government audience.

For previous discussion on the external cost of haulage firms see here, here, here and here.   

Saturday, 20 November 2010

Intellectual Poverty (David Mwanza)

This is a good example of it :
Konkola Copper Mines (KCM) says that Windfall taxes have the capacity to distort the country’s economy and suffocate mining companies.

KCM Board Member Jacob Mwanza says the taxes, if implemented, can only collect increased government revenue for a short period of time. Dr Mwanza says this revenue can distort the economy because it is money which is not budgeted for. He told a media briefing in Lusaka today that current mining taxes are adequate.

He added that the windfall taxes are not widely used in major copper producing countries such as Chile and Australia.
The intellectual poverty of the pro-low mining tax lobby has reached a new low. One does not have to be an economist to see why our Dr Mwanza is only a "Doctor of Philosophy" on paper. Are these these the people Musokotwane was referring to that are in touch with "modern economics"? This is a man who was at one point "Governor of BOZ" and Vice Chancellor of University of Zambia. Are you still wondering why we are poor with such "talent"?

Book Reading Goal : Week 41

Bonhoeffer: Pastor, Martyr, Prophet, SpyThe 34th book read in the last two weeks is also perhaps the very best I have read for sometime. The book in question is Bonhoeffer: Pastor, Martyr, Prophet, Spy by Eric Metaxas. At 591 pages it was worth every word!  It is hard for me to describe this book without doing some injustice to it.  The book truly opened a window to a dark era of human history in which one light shown brightly before all others. One quote sums up Bonhoeffer's life : "Silence in the face of evil is itself evil : God will not hold us guiltless. Not 2 speak is 2 speak. Not 2 act is 2 act". May we know the full meaning of these words!

Book Reading Goal Review
Books Read So Far : 34 books
Remaining Books to Achieve Target : 16 books
Weeks Remaining to Achieve Annual Target : 7 weeks **

**As December is "blogging leave", I shall also be taking leave from reading for 4 weeks (hence will freeze the count) :)

Friday, 19 November 2010

Zambia Weekly - Volume 1, Issue 46

Zambia Weekly - Week 46, Volume 1, 19 November 2010

Zambia Elections 2011

I had announced Zambia Elections webpage  a while back - it is now cleaned up a little bit. The website will published articles and news item solely related to the 2011 elections. We hope when the candidate profiles, "manifestos" or other policy statements are available we can put them on there. The website comes with its own Twitter and Facebook pages.

Do also check out the third website - House of Chiefs dedicated to the matters of traditional leadership. I have also cleaned this up a little bit!

Thursday, 18 November 2010

Debt Watch (World Bank)

Thought it was about time we started a thread that tracks new debt obligations by the government. We shall keep tabs on this through the "aid" tag. Last week ZNBC reported a new $150m loan to Zambia by the IFC :
The International Finance Corporation-IFC, an agent of the World Bank, says Zambia will next year receive 150 million US dollars credit meant for irrigation. Vice President Ars Phunell says the credit is meant to support irrigation projects at three yet to be identified sites in the country. And World Bank Country Manager Kapil Kapoor said the credit facility will be repaid in the next 20 to 30 years.

And Commerce Minister Felix Mutati said government is embarking on several infrastructure projects in rural areas, to give an opportunity to rural dwellers to participate in the economic success of the country. He named one of the projects as Kasaba Bay, which is creating investment and jobs.

Wednesday, 17 November 2010

Mining Taxation Debate (A Response to Henry Kyambalesa)

Hon Hamududu  recently observed that government had not given a coherent rationale on current mineral taxation, "It’s not that they don’t have an explanation, they do....The problem is that they are simply not making their argument clear when they talk about the new tax regime and the variable corporate tax which they claim is better than windfall tax".  Many of us have longed for a clear and coherent defence of higher mining taxation.  I was therefore delighted to see Henry Kyambalesa's defence of the current mining taxation. I welcome this intellectual "exchange of ideas" on the most important economic question facing our country.  Our children will judge us on how best it was handled.

I am afraid to say that based on his latest narrative, Kyambalesa is on the wrong side of the argument and without merit.  But let me start  with where I think we are in agreement. We fully share the basic premise that more government revenue is not a panacea :

Tuesday, 16 November 2010

Theresa Lungu's Twilight

Seize the Moment has a review of Twilight in the Morning by Theresa Lungu. There's also Q&A with the author, where she mentions her project - Books for Zambia.


Canada’s aid agency, the Canadian International Development Agency, lost about $880,000 as a result of the embezzlement, The Globe and Mail has learned. The Canadian aid agency spent more than $30-million on programs in Zambia last year....Zambia’s president, Rupiah Banda, has accused the donors of “blackmail” and “interference” for their decision to suspend their aid payments. The British medical journal, The Lancet, has estimated that foreign donors have postponed or cancelled $273-million (U.S.) in aid to Zambia because of corruption allegations over the past 18 months. This does not include the Canadian suspension....
Canadians have been coming to grips with how their aid money is being "wasted" in Zambia. At the last check, this article from Canada's The Globe and Mail had 133 comments! Lets just say the Canadian public is not happy.

Monday, 15 November 2010

A defence of the mining taxation regime (Guest Blog)

Of late, the taxation of mining companies operating in Zambia has become a highly topical issue. Currently, the mining companies are reportedly taxed as follows:

(a) 3% mineral royalty on income (that is, earnings) from copper sales;

(b) 30% corporate profit tax on profits declared after deducting costs and mineral royalties;

(c) 15% variable profit tax on all taxable income (that is, profits) earned that exceed 8% of copper sales;

(d) Deduction of 25% of expenditures on machinery and equipment from taxable income per year once a mining project starts operating;

(e) 15% income tax on foreign companies and expatriate consultants providing services to locally based mining companies; and

Sunday, 14 November 2010

Another day, another party, 8th Edition

This surely must be a joke. It appears we have a new political party called African Democratic and Economic Organization Zambia Must Change Now. With a name like that it is not surprising that the abbreviation is equally long. ADEDO - ZAMUCANO has been formed with the intention of contesting the 2011 elections. The interim Party President is a  Brown Kapika who alledgedly had gone into "self-imposed exile" to the Netherlands in 1992 during the Chiluba regime. He returned last month! The party’s symbol is a "red card", which has not gone well with Father Frank.

Related posts:

12 reasons why profit margins are low in Zambia

By Ruth Henson

There are several factors that contribute to low profit margins for Zambian businesses :

1. Inconsistent government policies. Nobody knows what government policy will be for any reasonable period of time. Government can and does change the rules whenever it is politically expedient to do so. This can have unforeseen disastrous effects on businesses.

2. Excessive taxation. Every kwacha earned in Zambia is taxed over and over. Earn a salary and pay tax on it. Spend it and get taxed again. Pay your Zesco bill and pay excise tax which is then vatable. Anything imported is charged duty and then VAT even on the duty. Fuel has tax upon tax upon tax which then feeds into the cost of everything else.  All this tax would make sense if it was fairly shared but those who can afford good accountants pay less, mines pay less, new investors pay less. The formally employed carry a disproportionate share. Again sharing on the expenditure side is disproportionate. Taxes pay for politicians children to go to expensive private schools and the children of the poor have to pay to go to school because government funding is insufficient to run the school.

Friday, 12 November 2010

Quantum arrogance

The Company, through its Zambian subsidiaries, is party to Development Agreements with GRZ for its existing operations which provide an express right to full and fair compensation for any loss, damages or costs (including interest) incurred by the Company by reason of the government's failure to comply with the tax stability guarantees set out in the Development Agreements, and rights of international arbitration in the event of any dispute. Following consultation with external legal counsel, the Company assessed there to be a high probability of recovery from the GRZ of payments made in respect of these taxes.

In the consolidated financial statements, the Company has recognized a tax expense in accordance with applicable laws from time to time notwithstanding the Development Agreements. In addition and reflecting the enforceability of the Development Agreements, the Company has recognized a receivable from the GRZ for an amount in respect of the expected ultimate repayment of taxes in excess of the taxes permitted under the Development Agreements. This receivable has been classified as "loans and receivables" and initially recorded at fair value based on management's best estimate of the timing of receipt and amounts due. As required, the receivable is assessed for impairment at each reporting period based on changes in facts and circumstances; any impairment amounts required may be material. As at September 30, 2010, this receivable amounts to $221.4 million.

Currently, the Company is involved in discussions with the GRZ to find an alternative solution to arbitration or litigation to fully resolve all outstanding matters in relation to the tax changes introduced in conflict with the Development Agreements. While the timing and outcome of these discussions remains uncertain, the Company recognizes that resolving this dispute through arbitration may not be in the best interest of either the Company or the GRZ. Accordingly, while no terms have been agreed to, the Company is seeking to achieve a compromise resolution which respects the key terms of the Development Agreements.
Excerpt from First Quantum Minerals Ltd press release announcing the report of its results for the three and nine months ended September 30, 2010. The complete financial statements and management discussion and analysis are available for review at their website. First Quantum appear quite confident that they will have "their money" back! Interestingly that confidence is not placed in the courts since they conclude "the Company recognizes that resolving this dispute through arbitration may not be in the best interest of either the Company or the GRZ". Rather it is in their negotiating team and a weak GRZ at the other end of the table. 

Thursday, 11 November 2010

Yes, let us sell failing parastatals!

Treasury Secretary Likolo Ndalamei has indicated that the government will not recapitalise parastatals that have continued to face operational challenges : "We are in the process of seriously examining all the remaining parastatals, especially the loss making ones to see which ones should be privatised".  I think I know where Ndalamei needs to start with his "excellent" idea, :
I am reliably informed that the Post newspaper has the largest circulation of about 40,000 copies per day, as compared to the Daily Mail and Times of Zambia which have a combined print run of not more than 15,000.

The Post usually sells like hot cakes, whereas the public tabloids would be very lucky to push sales above 3,000 copies per day. I also speak with absolute confidence as someone who has sold newspapers before: for every 100 copies of the Post sold on the street, one would be very lucky to sell 5 copies of the Times and the Daily Mail combined. People hate these papers. The “unsold” copies are over 90%.
That excerpt is from Malama Katulwende's lengthy piece “Shikapwasha’s Dogs”: Why the Public Media in Zambia Has Lost the People’s Trust.  The reason why people continue to be baffled by Ndalamei and his friends' approach to privatisation is that it has no credibility. If their approach to privatisation is principled they would have sold the Daily Mail and Times of Zambia. Not only are these companies lossing making parastatals but they stand  in the way of a genuine democratic dispensation and the fight against corruption. The papers also continue to be a personal toy of the government of the day at huge expense to tax payers. 

Wednesday, 10 November 2010

How the copper mines won, 4th Edition

click to enlarge
We continue the bi-monthly copper price check. The general upward trend towards the magic 10 continues. Readers are reminded that we have of course long breached the copper price level at which President Mwanawasa introduced the windfall tax (in January 2008). The windfall tax was designed to match rises in the price of copper: it was set at 25 % while copper sold for $2.50 per pound, 50 % for the next 50 cents and increased to 75 % when copper fetched above $3.50 per pound. You will see that throughout the last six months prices have remained consistently above $2.50 per pound and since September consistently above $3.50 - in short no more thresholds to break. It goes without saying, we would be laughing all the way to swifter poverty reduction had stuck at it. 

Tuesday, 9 November 2010

The 2010 Human Development Report (Guest Blog)

According to the 2010 edition of the Human Development Index, the quality of life in three countries—that is, Zambia, Zimbabwe and the Democratic Republic of the Congo—has slid backward, while many people around the world have experienced dramatic improvements in education, health, economic well-being, and other key aspects of their lives.

The decline in the socio-economic well-being of Zambians has, by and large, been a culmination of several factors described in a nut shell below.

Monday, 8 November 2010

Cursed by mining companies..

Kafue River in Chingola has been polluted again by mining effluent from Konkola Copper Mines (KCM) Tailings Leach Plant (TLP) leaving most of the townships without tap water. Environmental Council of Zambia inspector Webby Simwayi who rushed to Kafue raw water in-take confirmed the poisoning of the Kafue River, the main source of drinking water for all Copperbelt towns....

Mr Simwayi said he was happy that Mulonga Water and Sewerage Company(MWSC) had quickly shut down the raw water in-take plant to prevent poisoning of people....He said the fact that even marine life was found dead prompted his technicians to shut down the in-take plant....A Times staffer who rushed to Kafue River found the peasant farmers living along the river picking the dead fish for consumption. The fish and other marine life was also found dead along the banks of Kafue River and by 18:00 hours yesterday the river poisoning levels were very high.
Excerpt from the Government controlled Times of Zambia piece Kafue Pollution Leaves Chingola Taps Dry. I have previously touched on the ecological and health genocide which continue to perpetuated by mining companies . In the words of Vendanta "Of course we pollute…but all the mines do. It was worse in ZCCM’s days...We are fed up being blamed. You cannot run a mine without causing pollution".  I said it then, and I will say it again.

Our people living in mining communities are humble and peaceful people. Their only crime is that the Creator has endowed them with a precious gift - the minerals below their feet. It cannot be denied that they do not enjoy these precious gifts and continue to pay a huge price (the costs to them continue to outweigh the benefits). It is a situation which would never be allowed in any society that values its citizens. No serious government on earth (aside from one running a failed state in Yemen) would let mining companies get away with significant pollution without huge associated costs and appropriate compensation to communities. 

Sunday, 7 November 2010

Reversing domestic violence

The problem of domestic violence appear to have gained significant prominence in recent times. Of course such problems have always been there, but they now appear to get more coverage as prominent individuals become entangled on them. We have for example seen in recent times' the sad death of Hon Mabenga's daughter at the alleged hands of her husband ('alleged' because case is still pending) and of course the famous saga involving Hon Mwamba. Without doubt, domestic violence, child abuse / trafficking and certain customary practices continue to be great evils facing our women. But how do we help them?

Certainly not through the empty talk recently exhibited by Non Governmental Organisations Coordinating Council (NGOCC) chair Engwase Mwale when commenting on the failure to prosecute  Kasama Member of Parliamentary who has previously admitted beating his spouse :
And Mwale said her organisation was disappointed with Mwamba’s wife, Chama, for withdrawing the case against her husband. Mwale said NGOCC had expected Chama to lead by example in redressing the rampant violation against women and children through this high-profile case. “She has once again lost an opportunity to give women an opportunity to resolve to seek justice at the hands of difficult economic, social and cultural situations,” Mwale said.
Its clearly irrational to expect Mrs Mwamba to act. Her actions reflect what most people would do - which is act in their self interest. Why should we expect her to bear the cross for every woman? Ms Mwale's  highlights the flawed thinking of NGOCC. They do not seem to realise that any victim of gender based violence will always be in a weak position to act, regardless of their status in society. What NGOCC should be focusing on is to provide specific proposals that would help reverse domestic violence by relying less on victims. My policy suggestions are two-fold.

First, we need a new law relating to gender based violence that allows pre-court evidence to carry substantial weight in court proceedings. In the example above, it would mean what Mrs Mwamba said first time would have carried more substantial weight than what she then said after the husband and relatives pressured her. We can justify this change if we all accept that domestic violence is a crime not just against the individual but society - it demeans us all. While making that change, we might also explore other issues around "burden of proofs" and the possibilities of " financial penalties" paid into a "victim's fund".

The second change is the need for special domestic violence courts. It appears that our courts may not fully realise the special nature of some of these cases, especially the cultural and economic angles. We need to experiment with tailored judicial proceedings. The reason why many people do not take these cases forward and choose to suffer in secret is that the process is too long and unpredictable. If we can make the trials quicker we are  likely to see more women come forward.

I will have a lot more to say on this issue in the future, but this is what NGOCC should be focusing on. Coming up with cost effective alternatives. Let us quit blaming victims like Mrs Mwamba and focus on how we can help them.

Quick notes

The IMF recently nodded a gigantic Chinese loan to Ghana aimed at finance Ghana's oil and gas infrastructure and agricultural development.

Jagdish Bhagwati on why the attempt by some NGOs and activists to impose a straitjacket on corporate social responsibility  is misguided and must be rejected.

Zimbabwe's Econet Wireless recently launched its mobile broadband package to 4.5 million subscribers after spending $100m on upgrading major cities.

Perpetual Sichikwenkwe on how the lack of land reform continues make Zambian women vulnerable and are effectively "forced to farm for free".

Saturday, 6 November 2010

Does 2011 belong to the youth?

The current electorate is the remnants of the electorate that registered in 2005. Many 2005 voters have died, lost or sold voters cards, or migrated in search of work. What remains is hard core that is not necessarily representative of the voters register that will emerge from the ongoing registration exercise. They are few in number – in the case of Chilanga the turnout was only 23 per cent versus the 65-75 per cent one would expect from a recently compiled roll. And their demographic profile is perhaps different from what is to come - none of them are younger than 22 years old, for one thing.
Guy Scott on the potential role of the youth in 2011. You can read the rest of the piece here.

Thursday, 4 November 2010

Death Penalty, 4th Edition

Conrad Mbewe on the death penalty :
The basis of punishment is not how successful it will be in rehabilitating the offender but rather whether it is fair with respect to the crime committed. In other words, the basis of punishment is justice. In the domestic sphere, our punishment is really a form of corrective discipline. The parents’ chief interest is not justice but the positive changing of the character of the child. But that is not the job of the judiciary. The work of the judge is to ensure a correct interpretation of the laws enacted by the legislative arm of government, to acquit the innocent (i.e. those who continue to obey the laws), and to prescribe fair punishment on those who break those laws.

So, whether the punishment meted out will reform the convicted criminal or deter other would-be offenders is not the business of the judiciary. The one question they should ask themselves is: “Does this punishment fit the crime that has been committed?

Once we are clear about the basis of punishment, then we are ready to address the question of the death penalty. The one question we must answer is: “Is it fair to take away the life of person who maliciously takes away the life of another person?”
The first part of the argument is broadly correct. The correct basis for "retributive justice" is just punishment. The issue is not rehabilitation but whether the punishment fits the crime.

The only problem I have is that Mbewe's argument remains incomplete because "who" determines the punishment is really what has always been at stake. It is not the judiciary, but the people (as he rhetorically states at the end). Many European nations that oppose the death penalty believe, right or wrongly, that society can always decide that a life taken does not deserve another one. Since both camps appeal to the "will of the people", at this point we must then ask are abolitionist countries like Sweden less just or more just than Zambia with its death penalty? It would appear that without a common objective standard across Sweden and Zambia, both would could be deemed just.

Mbewe's argument would have been more cogent if he had argued that the residual control of life lies in the power of the Creator and therefore only he has the power to take it. Anyone who takes another life forfeits theirs. I do not believe there's a cogent case for the "death penalty" outside a theistic framework. The reason is that without a theistic framework one has to deal with a problem of subjective moral values - which renders any form of justice impossible. Mbewe tries to deal with this problem by appealing to natural law "thankfully, fairness is not a preserve of those with university degrees in law. Even a child has an inborn sense of justice". But is the child born with the sense of just punishment? The child knows when she is wronged, but she wont naturally know what the appropriate "corrective" response to that wrong is. Moreover we cannot be certain that every child will have the same view.  Therefore, justice is not some inner thing we have, it is externally generated. A gift of the Creator in the natural order. This has been ably demonstrated by Nicholas Wolterstorff.

Update (6 Nov 2010) :

Conrad Mbewe's response below, as posted in our exchange on his website :
I have ready your incisive observations on your website and was tempted to post my response to you on the Zambian Economist. However, I thought I should first do it here. I agree with you that a rational basis to uphold the death penalty finds its strongest foundation in a theistic framework because values there are absolute. For instance, in that framework you can argue for a priceless value of human life on the basis that humans are made in the image of God.

However, given that I had fifteen minutes in a context where others together had a good three hours, I needed to confine myself to that which was already common ground with the vast majority of my hearers--common sense. In my booklet, "The Death Penalty--True Justice of Archaic Folly," I work from a theistic framework and my arguments are more formidable. Again, thank you for your observation!

Wednesday, 3 November 2010

IMF - Zambia Watch (Nov 2010)

Statement by the IMF Staff Mission at the Conclusion of a Visit to Zambia
Press Release No. 10/411
November 3, 2010

An International Monetary Fund (IMF) mission visited Lusaka October 28-November 3, 2010 to continue discussions for the fifth review under the Extended Credit Facility (ECF). The mission had fruitful discussions with Hon. Situmbeko Musokotwane, Minister of Finance and National Planning; Dr. Caleb Fundanga, Governor of the Bank of Zambia; and other senior officials.

Tuesday, 2 November 2010

Pf Policy on Agriculture

We have yet to see coherent policy propositions from the parties vying to rule Zambia for the next five years. Ideally, we should now be seeing emerging policy papers from the parties that test "the ground" with the electorate so that when their manifestos are finalise they would truly be "people driven". But clearly we are far from the "ideal democracy", so our people must be content with crumbs that fall off from interviews. We had another crumb this week with a hint of what PF agriculture policy might look like :
On agriculture, Sata said maize marketing and credit finance under the MMD government has disadvantaged small and medium-scale farmers due to lack of credit and the determination of the floor price of maize by the government without taking into account the production costs incurred by farmers.

Monday, 1 November 2010

Inflation Statistics - October 2010

Click to enlarge

The annual rate of inflation, as measured by the all items Consumer Price Index (CPI), reduced to 7.3 percent in October, from 7.7 percent in September. The 0.4 percentage point decrease is attributed to the "reductions in the cost of non-food items". More detail via the CSO Monthly Bulletin.