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Wednesday, 19 January 2011

Growth Debate (A Response to Trevor Simumba) (Guest Blog)

It is true Zambia has finally got a positive growth going and one should not belittle the MMD’s commitment to a free market even though other fundamental reforms like justice, equality, freedom of expression and accountability fall well short of our 1991 commitments and even modest expectations. Frankly though, it would be hard to imagine how Zambia would fail to achieve reasonable growth under such favourable metal prices combined with continued budgetary support from the plethora of donors. It seems that once a society adopts the free market, the results are inevitable as can be seen by playing this video from gapminder.org. (tick Zambia in the right hand box).

In fact the question everyone is asking is why Africa has taken so long to arrive at high growth. Firstly the locust-like high consumer economies were focused elsewhere, mainly South America and Asia, and global investors have only just begun to take Africa seriously as a supplier of raw material. The second major factor for the delay is cultural resistance which I will come back to later.

I’m not an economist but investment is surely largely responsible for Trevor Simumba’s growth figures. As we know the extractive industry is generally fickle and faceless and cares little about governance, human rights, environment and cultural sensitivity as long as there is a quick buck to make for relatively low capital investment and risk. Is this the kind of investment that will help Zambians get rich? Not unless the workforce is prepared with the appropriate skills and government taxes and regulates these business and judiciously investing into productive renewable sectors. The opportunity doesn’t last forever: Zambia has sold about a quarter of its finite sub-soil resources already and damaged much of its natural capital in the process (soil, forest, fish and wildlife) but has precious little social investment to show for it. We are still consuming the assets; I believe economists refer to it as "asset stripping". To a layman it’s like a farmer eating his hens instead of feeding them and sharing the eggs. We have also squandered the international community’s good will and the marshal plan for Africa is quickly turning into humanitarian support which helps no-one.

Regaining indigenous control of the economy was always going to require a high degree of mutual trust and partnership between government and the people in Zambia’s post colonial condition. This covenant was damaged when communal ownership and management of land and natural resources, the indigenous economy, were centralised in the 70’s and despite overwhelming evidence from around the world that local authorities provide the best stewardship, the classic tragedy of the commons continues unabated. Instead of correcting the problem the economic disenfranchisement continues unabated with corrupt chiefs joining the sale of public assets. Fortunately the majority are resisting the temptation of quick money and many are making their own arrangements to regain at least formal custodianship in the form of trusts. With neither land tenure system providing adequate security of ownership it is no wonder average yields of maize have plummeted to less than a tonne/ hectare.

Preparing for the looming challenges like peak phosphorous, peak oil, climate change (which in Zambia’s case will almost certainly be drier) is way overdue and must begin with the ownership issue. To capitalise on the lucrative and mutually beneficial opportunity to provide eco-services to the world, Zambia will have to undergo a paradigm shift from being the second fastest deforesting society on earth to becoming a key carbon soak. The current government has overseen wholesale plunder of fish and wildlife stock, sat idle while some 70% of the national livestock herd has been decimated by disease (and continues) and ignored the pollution and degradation of the all important Kafue basin. Estimates are that Zambia loses at least the global average approximately 4 tonnes of soil per capita to erosion every year and increased fire on the ever drier and brittling habitat (probably due to decline in large mammals) is depleting organic carbon and moisture critical for plant growth and soil stability, the life support system. Ultimately, the wealth and health of our people depends on learning to manage our environment sustainably, a fact fatally ignored by many great civilisations to date.

Let me now come back to the cultural resistance I mentioned earlier. Indigenous culture is inherently incompatible with the values that drive modern economies. Societies that put community first, share common resources and promote modest consumption do not fit with “greed is good” “I want it now” and “its all about me” memes that now drive the global economy. This dilemma is a huge problem often swept under the carpet but most Zambians I know resist making this cultural leap until they become desperate. It means abandoning the fundamental values that underwrite the oldest sustainable survival strategy on earth. The state structure and legal system do not accommodate both cultures ultimately forcing people to choose. I have interviewed hundreds of charcoal burners who hate what they do to the depth of their souls but have no more options. Most rural people resort to urbanisation because it frees them of their cultural responsibilities to the environment and the community. I would argue that the growth Zambia is experiencing is in a large part due to the resistance to plunder finally breaking down as it has in western societies.

Is abandoning traditional culture the best survival strategy? Perhaps in the short term but the scientific consensus is that nature will punish us severely if we do not infuse the wise lessons learnt through history into our economies. With a more open debate, perhaps Zambia can find a reasonable compromise between science and greed and lead the world forward into a culture of sustainability!

By the way Trevor, where would MMD be without the sacrifice of the unpaid opposition who keep steering it back on track- it’s no coincidence that the majority of critics are founding members who clearly believe in the principles more than the power. If not for them we’d certainly have had Mr Chiluba for a third term, maybe forever!

Rolf Shenton

The guest author is the founder of Zambia Wild 

(The Zambian Economist encourages guest contributions from leading Zambian thinkers on matters relevant to national development. The purpose of these notes is to stimulate discussion and ensure logic and impartial critique plays a leading role in shaping public debate. See the guest authors page for more information).

17 comments:

  1. Rolf has taken a stance that eludes most policy makers and regulators alike. He carefully and expertly create an impression of what Zambia ought to wake up to in terms of defining for herself what development means. I particularly like the idea that his arguments take into account indigenous values that are virtually universal (in indigenous communities) and their applicability in sustainability. Truth be told, the rest of the world, the industrialized nations especially, will have to realize that there is no means of survival on this little planet of ours except by incorporating indigenous values into our new ways of life. The alternative is human extinction.

    Rolf also brought to the surface the advantages and disadvantages of Zambia continuing on the path beaten by other nations who have brought resources barrenness upon themselves. His arguments, if allowed to fuse with those of practical economists would contribute to the principles and values of sustainable development that Zambia should have...like yesterday.

    What I do not want to agree with in Rolf's thesis is his suggestion contained in the opening segment that 'MMD has demonstrated sufficient commitment to development.' That cannot be farther from the truth. It is their manner and measure of development that I am finding difficulties to understand. What is development (or rather growth) for Zambia? What are its critical elements and how are they aggregated? Until and unless (old saying) we can put a finger on these critical elements and know with a fair amount of certainty what they are, we cannot say Zambia has experienced growth. First, who is tracking them and how?

    The fact that one or two components of our GDP calculation (appealing to the basic textbook approach) are driven by forces external to Zambia (donations) further complicates the path to a useful design, that is if we have the desire and the sincerity to find one. External funds exchanging hands over external products makes Zambia a poor trading post.

    We need a model for Zambia to downplay less than intelligent suggestions that consistent interrupted power supply (IPS), as opposed to Uninterrupted Power Supply (USP), and traffic jams on Zambia's urban roads are legitimate measures of economic growth. These are episodes of poor planning and nothing more! The perception that a seasonal crop (popularly dubbed 'bumper harvest') factors in the measure of economic growth is simply absurd. No economist worth their salt should echo let alone suggest measures containing things like that.

    Thanks for sharing.

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  2. Dear Rolf,

    I have long thought that the process of decolonisation has been political, but now must be economic. And that also means moving away from the model of production for distant markets, which continues to this day, including in Asia.

    What I would like to see - worldwide - is that people start to produce for local consumption first.

    The most wealth is created when money recirculates within an economy many times. This has the greatest impact on job creation, keeps money within a community (or city/region/country), and has the lowest carbon footprint as a bonus.

    Unlike the supply siders (and their search for investment), I think that economic activity is pulled by demand, which means we should be raising people's incomes.

    - create works projects
    - raise the minimum wage to a living wage, which would be the equivalent of the cost of living
    - do not allow foreign companies to pay below the minimum wage in their country of domicile
    - unionisation of all workers
    - lower the bank lending rates closer to the rate of inflation
    - have a real industrialisation policy, that puts an emphasis on supplying goods to corporations
    - an emphasis on creating family farms in rural areas

    If there was an economic model that would coincide with communal values, it would be the non-profit model.

    For instance, it would be possible to have a farm cooperative that would collect 20% of it's members products, deduct 12% from that as profit which non-profits are allowed), and use the rest either to buy capital goods or return it to the members as a bonus.

    That way, people would keep most of what they produce, and most of what they do not keep goes to invest in their cooperative/community, adding to the general wealth.

    Such an economy could easily be achieved through legislation.

    As to the neoliberal economic measure called GDP - much of that is going to be the untaxed and unshared exportation of raw materials by foreign corporations. GDP in Zambia is as phoney as the MMD's claiming it as their success.

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  3. Mwata, we have to be careful with this indigenous value thing. Indigenization per se is not a bad thing, but this could stifle or dwarf our ability to develop technology, which in turn would be necessary for our survival. If the mind is open and creative enough, survival solutions can be found. Indigenization also becomes a drawback when it limits a nation (a people) from being open to new ideas and progress. Fundamentalists – Moslem or Christian stick to what was written many centuries ago and cause harm and slows everyone. Jihadists act religiously to do what they do to perpetuate their beliefs.

    So just be careful. If you ask Chinese – they will tell you that strictly sticking to the old ways doesn’t always pay. Although China is still a closed society, but they have relaxed a lot of things. Yuppies in Peking or Shanghai behave exactly like those in New York City or London. So some change or accommodation is good.

    However, Shenton is right on when he talks about being good custodians of our assets and resources. Sustainable development is wiser than careless forms of development. Especially for Zambia, which by enlarge continues to rely on ‘extractive & depletable’ resources. We know for example that one day copper will finish, but we continue behaving as if this was a fluke. No serious diversification or anything.

    When it comes to MrK, there are some things I have always differed with him on. MrK is totally against foreign trade. But I don’t know how Zambia can survive without international trade in today’s globalized environment. Schumpeter’s “small is beautiful” or “self reliance” being taught to Tanzania’s Nyerere, has long been dumped by the contemporary Tanzanians. Their economy would have remained behind had they not adjusted.

    In 1970s & 80s European advisers like Renė Dumont used to preach to our Presidents – that Africa needed only hoes, jembe, and oxen to produce staples. KK is one of those who resisted. It is the same message MrK is trying to tell us by saying “we must produce for local consumption first”. To have food security guaranteed by local producers is good. But that should not only be the goal. We have to aim higher – partly because at some point you do need cash/forex. Unless of course you think that barter trade would work. A blend of some cash cropping is therefore unavoidable. Also remember that – not all areas are endowed with resources such as good land and rivers. Why do you think the Lozis were wandering about? Because the Zambezi flood plains were at times inhabitable.

    But all in all, I think we are in agreement, that – MMD’s policies, if carefully scrutinized, are not up to the mark [even if they seem to be for some people].

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  4. Rolf, thanks for taking the time to read my posting and for your response. As you say you are not an economist and so much as I recognise a lot of the issues you have raised on the social, environmental and cultural issues, my article was purely stating a fact that Zambia's GDP has been growing steadily and will continue to grow. Let me quote directly from African Economic Outlook report for 2010:

    "After 30 years of relatively dismal economic performance, Zambia’s macroeconomic situation has changed in the last 10 years with gross domestic product (GDP) growth at an unprecedented average of 4.8% between 1999 and 2009. Growth continues to be driven by increased output in the construction, mining and agriculture sectors." As you will note from the above its not just mining that is driving growth in Zambia. Read any international economic and business publication and you will find whenever Africa is mentioned Zambia is there as a leading light. Peaceful, stable and a growing economy. Why should bringing out such a topic arouse anger amongst some people? These are not my personal figures. these are figures calculated by the IMF, World bank, Economist and others.

    the key for Zambia like I pointed out is to translate this growth into tangible development in terms of better schooling, health and jobs. BUT let us be clear about one thing. whatever your ideology YOU CANNOT HAVE ECONOMIC DEVELOPMENT WITHOUT ECONOMIC GROWTH. You need income to redistribute it to the poor and without income what will you re-distribute? The Chinese President visiting the USA last night, in trying to justify China's economic policy stated that China is a 'developing country' with a large population and so it needs to grow its economy even more hence why they kept thier currency under-valued. But statistics show that it is now the second biggest economy (with 3 trillion dollars in reserves and holding the largest chunk of US bonds) in the world after the USA but the President still considers his country a developing country and they still have hundreds of millions of chinese people that are poor. So are we going to say that China's economic growth is just on paper?? Are we going to accuse the Chinese Communist party of doing nothing even though there has been consistent growth for over two decades? I wonder.

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  5. On donors Rolf, actually Zambia has reduced its dependence on donors and now less than 40% of our budget is attributable to donors. we are also now collecting more domestic revenue and the ZRA forecasts achieveing 10% more tax above target. Our main problem is rural poverty even though Zambia is on course to meet more than four of the eight United Nations MDGs. The 2009 Mid-Term Review (MTR) report of the government’s FNDP, however, notes that there has been limited progress towards addressing rural poverty. Urban poverty reduction, however, shows a positive trend mainly due to the recent upturn in economic activity, which is largely urban-based but has been transmitted via increased employment opportunities in the mining sector. So your ideas on rural development are most needed right now in zambia.

    Its vital as Economists that we deal with facts and figures rather than just being critical without a basis. the Opposition yes has played a major role but since the demise of Anderson Mazoka the level of debate has declined substantially. The UPND team of Andy Mazoka, Bob Sichinga, Patrick Chisanga, Magande and others produced the first ever alternative budget that was better laid out and actually forced the MMD Govt led by H.E. levy mwanawasa to poach Magande as Minister of Finance and implemented many of the solid ideas UPND had in their budget. To this day we are yet to see a similar product from the Opposition or a leader of the stature of Mazoka who even under extreme provocation maintained his dignity and always put the country first.

    When you look at other opposition parties within the sub-region even just next door in Zimbabwe you see much more credible debate based on issues and not personalities. MDC has provided proper checks and balances and has maintained peace and unity in Zimbabwe even when faced with extreme violence. Look at ODM in Kenya where they have even managed to introduce a new constitution. Our problem in Zambia is that we fail to even acknowledge a simple fact that our country is growing economically even though yes we do have challenges but at least we have a basis on which to build. I am happy to see that at least my article has made people think and come with good ideas. I would love for a day when as zambians we can disagree politically and economically but still share the same love and passion for our wonderful country. Zambia is making significant strides forward but it needs all of us as Zambians to do the best we can to contribute to this growth and to be positive about our country no matter our political affiliation. I for one will continue to celebrate my country and when international credible institutions pronounce zambia as one of the ten leading emerging economies in the world, I will highlight that fact and celebrate.

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  6. Hi Kaela,

    In 1970s & 80s European advisers like Rene. Dumont used to preach to our Presidents – that Africa needed only hoes, jembe, and oxen to produce staples. KK is one of those who resisted. It is the same message MrK is trying to tell us by saying “we must produce for local consumption first”. To have food security guaranteed by local producers is good. But that should not only be the goal. We have to aim higher – partly because at some point you do need cash/forex.

    I have not heard of Rene Dumont, and I doubt his ideas are the same as mine. Zambia will always be able to gain forex through copper and other mining exports - if it taxes the mines. However it can reduce the need for foreign currency (and eliminate unemployment) through local production. Having permanent food security through local production is no low goal, it is a precondition for national security. It creates both incomes and jobs, as well as social stability.

    I think people underestimate how much money can be made if proper systems are in place. For instance, 1 hectare (100x100 meters) can produce between 6 and 30 tonnes of ginger. One tonne sells internationally for $2500. That is an income of $15,000 to $75,000 from 1 hectare. And growing ginger is not difficult.

    And there is nothing wrong with hoes and jembe, or even oxen (although there is conclusive evidence that you can grow using no-till farming methods, which are actually better for the soil - compared to plowing, hoes and shallow cultivation are very friendly to the soil, which is why, combined with only using organic inputs, so many long used African soils are many yards of topsoil deep).

    Most of what are seen as the 'modern' farming methods, are the application of industrial methods and ideas, including 'efficiency' to agriculture. They are all about making farming more efficient, at the expense of the soil and our collective health.

    For instance, if you grow a single crop over say 100 hectares, then it is much easier to harvest. The problem is that there is no free lunch. A single crop is extremely susceptible to disease, which means you now have to start spraying to get rid of 'pests', which are simply insects or fungi/bacteria that like feasting on a particular plant, and now both have no competition and an unlimited food supply. At the same time, a single crop will make a single demand on nutrients, which means the soil now gets depleted of those nutrients. And that means you now need to fertilize the land to put those nutrients back in. Especially if the land is used to grow the same crop every year.

    Compare that to growing multiple plants in the same field. Immediately, pests can not run haywire through the crop. Different crops are accessing different nutrients, at different soil depths. Of course it takes more time to harvest (more jobs), but it also reduces inputs. And most importantly, it actually increases topsoil depth instead of reducing it.

    I wish everyone could read Natural Farming, by Masanobu Fukuoka. He basically reduces inputs to nearly zero, through crop rotation, growing multiple crops and plants in a single field, and relay cropping (broadcasting seed into maturing crops).

    Or an Eliot Coleman, who can get a 24 acres of yield out of 1 acre, using close planting and mobile hoop greenhouses in chilly Maine, and feed his entire family off that.

    When you see those giant combine harvesters thundering across the plains, they may seem extremely efficient, but they are also compacting the soil tens of yards deep, messing with the water cycle. There is no amount of plowing that can remedy that.

    And Zambia can make use of passive rainfall collection and storage systems, such as those from the great Geoff Lawton:

    (See: Permaculture Rainwater Harvesting)

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  7. Unless of course you think that barter trade would work. A blend of some cash cropping is therefore unavoidable. Also remember that – not all areas are endowed with resources such as good land and rivers. Why do you think the Lozis were wandering about? Because the Zambezi flood plains were at times inhabitable.

    But all in all, I think we are in agreement, that – MMD’s policies, if carefully scrutinized, are not up to the mark [even if they seem to be for some people].


    Not necessarily barter, but how about having local currencies in parallel with the national currency? That would decrease pressure on the national currency and demand for foreign currency as well.

    How about having provincial or district banks, to sidestep the kartel/collusion behaviour of the existing commercial banks?

    But the key to wealth accumulation is to have as much value addition as possible done locally.

    And we can raise demand by raising people's incomes, first through works projects, education, stimulating SMEs, unionisation, raising the minimum wage to a living wage based on the 'basic needs basket', and for foreign corporations, the minimum wage that the law in their own country.

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  8. "I’m not an economist but investment is surely largely responsible for Trevor Simumba’s growth figures," says the author.

    Well, the author seems to attribute the figures about the projected growth of the Zambian economy to Comrade Simumba.

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  9. Zambia is a rich but poor country. I mean, Zambia is greatly endowed with minerals, fertile land and fresh water yet it is gifted with bad culture. Zambia in the pre-colonial days experienced mining activities at minimal scale, subsistence farming and fruit gathering. My interest is fruit gathering which inculcated a lazy culture because things come on a silver place. Adverse conditions are what shake people out of their comfort zone.

    As fate would have it then come colonialization that taught Zambians to get educated for white-collar jobs. There was no deliberate policy to insure self-employment for school leavers. This developed unhealthy culture of job seekers. As a matter of fact stigmatization of people who wanted to venture into business upon finishing school was such that these people were viewed as school failures. From psychology of deindividuation in the mines where leadership was dominated by whites, we also learn that Africans believed that big businesses could only be run by whites. To date the inferiority complex still lingers in many citizens. Little wonder that entrepreneurship is not proficient in such an environment where individuals deindividualise themselves?

    After colonialization come KK. Alas, inherent laziness culture of the pre-colonial days was gladly welcomed and enhanced by KK’s socialist policies in form of economic handouts. It’s no surprise that the following statistics are consistent with our bad culture. I mean when I look at the following statistics of world ranking of GDP per capita of some sampled years as seen below:

    # 59 Zambia: $231.67 per capita 1964

    # 70 Zambia: $404.91 per capita 1972

    # 102 Zambia: $640.97 per capita 1980

    # 148 Zambia: $391.81 per capita 1991

    # 158 Zambia: $333.88 per capita 1996

    # 159 Zambia: $315.45 per capita 1998

    # 123 Zambia: $919.50 per capita 2006

    I would say the Gross Domestic Product (GDP) as is a value of all final goods and services produced within a nation in a given year, has little or nothing to do with the standard of living of the people in Zambia. Since independence, nothing much has changed in terms of the standard of living of the Zambians except for sanitation, literate levels and perhaps medical services right up to 1991. For some of us who lived under KK’s era, at the pick of his performance in terms of GDP in 1980, the standard of living of the Zambians was far greater than it is now despite that the current DGP is higher. This can be attributed to KK’s policies of free education and health services which regrettably is not sustainable in a long run as history the world over has proved. But if you look at the period 2006 to 2010 there is virtually no change in the aspects that can much up to the corresponding positive change in GDP. Therefore as a layman, I will say, GDP is not a good measure for the economic wellbeing of an average Zambian. A bigger chunk of the money is in the hands of a few individuals and some of it is actually a direct donor input and indirectly debt relief.



    Talk about debt, donors argue that although balance-of-payment payments are not the answer to Zambia's long-term debt problems, it will in the short term provide the government some breathing room to implement further economic reforms. However, although we have heard that balance of payment is donor funded, we should not be fooled or mistaken by verbiage. There is no donating here. The thing to lament about this mechanism is that to finance debt payment, the government borrows more to pay debt and its interest. What results is more-less like drilling another hole in the boat in order to drain out the water. The conclusion is that a country sinks deep into the savaging waters of endemic debt. Only wealth-creation can and should address the debt problem.

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  10. The reality on the ground is that more than 80% of Zambians live below the poverty datum line. It’s no surprise that the GDP is increasing in the light of high copper output and prices. But a pathetic tax system and low wages enables mining firms not to significantly add wealth to this country in terms of improving standards of living of the citizens. This country can do better with the current economic conditions but bad policies waste the opportunities of our prime time of today. Little wonder swings in microeconomics hardly affect a common man. I mean the price of copper on which the Zambian economy is over-dependent has experienced its customary wild swings, plunging at the onset of the global recession in 2008 before recovering close to previous levels with very little impact on a common man. While you might argue that this setback was countered by excellent harvests of the staple maize crop in 2009 and 2010 but at what cost of a peasant farmer when there has not been significant improvement of agriculture market? What value is there to write home about as far as the peasant farmer is concerned? We seem to be good at preaching mathematics at macroeconomic level yet the algebra of what it costs to meet the average and modest domestic needs of a common Zambian are neglected.

    The best economic policies are those that target and seek to improve the wellbeing of the middle income group. If you target the lower income group you’ll tend to fall into socialistic approach full of handouts, and we need not to go there again as we have had enough lessons with KK’s failed state-run enterprises. On the other hand, If you target the upper class, undoubtedly, you will be highly capitalistic which tends to alienate high GDP values from a common man and that is what I feel we are currently doing. A balance is to target the middle group whose earning can trickle down to other income groups. The easiest way to do this is to focus on entrepreneurship, revisit our tax system and minimum wages so that such instruments can increase the purchasing power of the citizens. We have to come strong on value addition to goods and services produced in this country and create jobs in so doing. Underutilization of human resources is perhaps the greatest factor contributing to Zambia’s underdevelopment. Without the human element, all other resources like capital, land and nature cannot be of any use. However human resource can only be effective if and only if it is provided with technique and skills to do so. These have to be relevant to entrepreneurship. In this light also we can make sure we also make efforts first to satisfy our domestic market. Timber and minerals are being looted out of this country and foolish enough we are proud to add this loot to GDP. Imagine if we were to do the right things, how much more could we improve our miserable lives in this rich country which has poor policies?

    This country is rich and I wouldn’t be surprised that favorable DGP values will continue to show yet the majority of the people will remain wallowing in abject poverty. Building confidence in the people and making them believe in themselves and think innovatively is not an easy task. It requires a holistic approach to unlearn the core values of society. This can be done if we make a policy to use schools, churches and the media. And what is this big army doing? Don’t resize it but make it productive. We need to revolutionize our way of doing things.

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  11. Dear all,
    Great debate thanks to Trevor and many interesting threads.
    Trevor, you are right that the growth figures are to celebrate and I am just trying to highlight the real cost to the environment and desperate need to restore it on behalf of the future generations who will rely on renewable resources when the copper is finished. The extraction industry must be made to carry the full cost now. Macro-economic stability has also been a godsend for everyone.
    You said “I would love for a day when as Zambians we can disagree politically and economically but still share the same love and passion for our wonderful country.” Absolutely, but how? I think love, trust and a more transparent system will only develop when presidential power is diffused, an understanding I thought we had in 1991. This would lower the stakes for plot 1 and its inherent patronage and stimulate a more constructive focus on solving problems. The ball has been in MMD’s court at two constitutional reviews but rebuffed at both. Outsiders happily exploit the divide.
    Mwata, I agree maintaining the raw free market essentially means government doing nothing but that in itself is not easy! There was a period when there was a lot of pressure from the command-economists on Chiluba to interfere in the market which he resisted.
    Mr K, Yes! The new global buzzword -local, local, local which I support totally! Every country including Sweden has allowed big government to suck out all the creativity and self-reliance from local communities. The inherent challenge in Zambia though will be to transfer international best practice especially in technology and skills as Kaela rightly warns. I see an opportunity for communal societies to mimic corporate structures and do business with the world! Kaela, I agree with your worries on local marketing but there has been a tendancy to produce for export ignoring local and regional markets. Usufruct rights avoids the need for alienation and compartmentalising land- its working well in Namibia. In any case it’s better than selling off the land and resources for buckshee and vague promises as we do now.
    Masanobu Fukuoka’s “one straw revolution” holds a very prominent position on my shelf alongside holistic management by Allan Savory. MF re-inspired the global conservation farming movement which was later adapted by Oldrieve in Zimbabwe. Mpundu Mwape and I helped sow the seeds in Zambia! Of course many of the traditional techniques in southern province follow the same principles but were sadly denigrated by early European settlers along with the ban of chitemene. Chitemene I believe still holds the key to sustainable green charcoal- better than clear cut.
    Dad in Mkushi didn’t go the whole way on no- till/conservation systems but my uncle in drier Mazabuka is a true convert and his maize yields are consistently above 6 tonnes even in his 80th year. There is much to do to prepare agriculture for the challenging times ahead. The bad news is some foolish donors have started promoting ploughs in Southern Sudan in an attempt to increase yields. Not sure what their problem is on yields is but ploughing sure ain’t going to help it for long- that went out of date in the 70’s!
    Mr K, some communities in Greece have begun a barter systems for services I guess having lost faith in their biggest self-help mechanism- the government!

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  12. Ba Kaela Mulenga,

    Allow me to recommend the following resources:

    1. Yakoana (You can find this almost 2hour long video on youtube)

    2. The Story of Stuff (thestoryofstuff.com)

    The points made by MrK and Kyambalesa are underpinned by the themes of these two recordings. It is clear from the thrust of the arguments of these two gentlemen as well as mine that going full throttle in the direction of modern development we are actually doing ourselves in.

    One of the two gentlemen put is so succinctly that reach for efficiency carries within it the seed of our ultimate demise. Indigenous values have always should not be misconstrued for static methods of resource transformation. They are simply techniques of harvesting from nature what we need in a manner that enables to harvest again and again.

    Much of what is produced in these industrialized nations, that are sucking resources from our lands are not essential essential goods. They have designed obsolescence so much so that ninety percent of them end up in landfills. Indigenous values that we have no option but to return to require that we only produce that which we need.

    If we adopted just this one value, we can begin to address a plethora of environmental issues and perhaps the chance for survival of the human species. Other than that, I am afraid to say, we are headed to a cliff at breakneck speed.

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  13. Hi Rolf,

    My issue isn't merely that I think that local government collectively should have more power than big government, but also that small and medium sized business should have more power than big business. In fact the size of big business should be constrained through legislation, the constitution if necessary.

    There should be laws against monopolies and kartels.

    Generally speaking, the biggest problem I have with Libertarians is that they see the danger of big government, but don't see the same dangers in big business.

    Large organisations are inefficient, they are slow to react to change in markets, and they collect too much power - whether they are privately or publicly owned. But at least public ownership gives some kind of accountability.

    We can have a discussion about what happened in Greece. I don't think it is the government that is the problem, the problem is that the government has been a tool for transnational corporation, through the IMF/World Bank, and with the help of Goldman Sachs.

    It was GS that sold them these toxic assets, 'all of a sudden' they discovered they are worthless and the government was bankrupt, so now they send in the IMF to demand an end or limit to government services to the middle class and poor, as well as privatisation of state owned enterprises. And the IMF is not part of any government. No one knows who the privately owned banks are that own the IMF, or the Federal Reserve, but it would not surprise me that they are the same privately owned bank that is the biggest shareholder in Anglo-American De Beers.

    This is what happens when private capital runs amok.

    ReplyDelete
  14. Mr K et al,
    I think we're in harmony here. The new scramble for Africa is not being led by nations but by corporates with control over land the main prize. Bear with me while I try to paint the picture more tangibly.
    Convincing chiefs to "incorporate" their communal natural assets into democratically elected management structures (the Trust act requires this) is a prime defence against land predation but this process does much more.

    It provides individuals a collective platform from with to negotiate improvements for themselves. Local governments recognise the strength of this patchwork of local management units for their administration challenge and have been surprisingly cooperative.

    Central government/development agencies retain overall regulatory control and benefit from having coherent civic local structures on which to hang development programs.

    The absence of land speculation opportunities forces private capital (corporate or individual) to respect and negotiate with existing land owners for production which is far more desirable than the industrial estates option. Contract growing schemes have proved to be a good way of transferring technology and controlling potential exploitation by corporates. The combination of government regulating from above and stakeholder's strength in numbers has, on the whole, fostered mutually beneficial relationships. In eastern and central provinces, a plethora of cotton and tobacco companies compete for farmers placing the advantage firmly in local farmer's hands.

    Returning more natural resource management to local stakeholders will open the opportunities for such relationships to develop over a wide range of products including other agricultural activities, tourism, timber, forestry products, fisheries in fact the whole productive economy can be integrated in an orderly fashion without the need for top down planning!
    Imagine how difficult it is to get stubborn private land owners back into a cooperative frame of mind- that’s the big hurdle in developed countries. Indigenous, local, bottom-up, stakeholder driven, community based NR management, empowerment, etc are all the same thing and most of Africa is in a good social position to take advantage of this.
    Lastly looking at how the natural resource benefit sharing schemes in places like Mfuwe have attracted people back out of town to fill the services gap, the spread of wealth and development is inevitable.

    ReplyDelete
  15. Mwata Chisha said watch:

    1. Yakoana (You can find this almost 2hour long video on youtube)
    2. The Story of Stuff (thestoryofstuff.com)

    Excellent stuff, I'll spread them.
    Thanks, Rolf

    ReplyDelete
  16. Hi Rolf,

    You should really check this out, especially the complaint lodged against Anglo-American De Beers (4).

    Mr K et al, I think we're in harmony here. The new scramble for Africa is not being led by nations but by corporates with control over land the main prize.

    Zambia was colonized by a transnational corporation - the BSAC of Cecil Rhodes. Who was his main fincier? NM Rothschild & Sons, which represents a family with a fortune today that is over $21 trillion (some say hundreds of trillions of dollars), bigger than the GDP of the USA ($16 trillion). That was in the 1880s.

    Fast forward 100 or so years, to the 1990s. The IMF pressures the Zambian government to privatise it's state owned mining monopoly, in effect the mining industry, through privatising ZCCM. Who handles the privatisation of ZCCM? NM Rothschild & Sons. (1), (2)

    Who does NM Rothschild hand Konkola Deep Mine to? Anglo-American De Beers. (3) Who is the biggest shareholder in De Beers? NM Rothschild & Sons. (AAMDB heir Jonathan Oppenheimer has worked as an analyst at NM Rothschild & Sons, and both Evelyn de Rothschild and David de Rothschild have worked as directors at De Beers.)

    So here you have colonisation and privatisation done by exactly the same bank - presumably for exactly the same purposes, to appropriate natural resources for themselves. So how are colonisation and privatisation different?

    The whole neoliberal ideology - privatisation, deregulation and free markets for corporate capital - benefits the same banks. There is nothing new under the sun. It is all a giant fraud.

    We all know how countries develop their economies from history - protectionism, free social services, state led development, but above all domestic ownership of the economy. That is what happened in Japan, China, South Korea, Taiwan, etc. And adhering to that model is why Asia is leaping ahead in leaps and bounds, while Africa stagnates while being bled by the IMF/World Bank policies and conditionalities.

    This is not about competition or free trade. This is about monopoly capitalism and global control - by 1 family.

    Sources:

    (1) Supplement - The sale of ZCCM

    Each package had attracted at least one bid. The bids were to be evaluated over four weeks by ZPA, ZCCM, and N.M. Rothschild and Clifford Chance as advisers to the sale. Preferred bidders would be selected and negotiations initiated. The final deal and decision to sell to a particular buyer in each case was to be subject to approval by the Cabinet and international lenders.

    (2) Bidding closed ZCCM
    www.zpa.org.zm/zccmbids.htm

    " The privatisation of ZCCM commenced in 1996, after GRZ and the Boards of ZCCM and the Zambia Privatisation Agency (ZPA) approved the ZCCM Limited Privatisation Report and Plan presented by UK based financial and legal advisors, NM Rothschild & Sons and Clifford Chance, respectively. "

    (3) Sale and Purchase Agreement on ZCCM Konkola North Mining Prospect ...
    www.zpa.org.zm/konkola.htm

    Upon the successful conclusion of Stage I of the Privatisation Process and the commencement of Stage II - as described in the Phase I Privatisation Report for ZCCM, dated April 1996, prepared by NM Rothschild & Sons ("the NMR report")

    On the hanky panky between NM Rothschild and Anglo-American De Beers, on the allocation of mines, basically to itself. From The UK Government's Department for Business, Innovation and Skills (BIS):

    (4) STATEMENT BY UNITED KINGDOM NATIONAL CONTACT POINT FOR OECD GUIDELINES FOR MULTINATIONAL ENTERPRISES (NCP): ANGLO AMERICAN

    ReplyDelete
  17. Hi Rolf,

    You should really check this out, especially the complaint lodged against Anglo-American De Beers (4).

    Mr K et al, I think we're in harmony here. The new scramble for Africa is not being led by nations but by corporates with control over land the main prize.

    Zambia was colonized by a transnational corporation - the BSAC of Cecil Rhodes. Who was his main fincier? NM Rothschild & Sons, which represents a family with a fortune today that is over $21 trillion (some say hundreds of trillions of dollars), bigger than the GDP of the USA ($16 trillion). That was in the 1880s.

    Fast forward 100 or so years, to the 1990s. The IMF pressures the Zambian government to privatise it's state owned mining monopoly, in effect the mining industry, through privatising ZCCM. Who handles the privatisation of ZCCM? NM Rothschild & Sons. (1), (2)

    Who does NM Rothschild hand Konkola Deep Mine to? Anglo-American De Beers. (3) Who is the biggest shareholder in De Beers? NM Rothschild & Sons. (AAMDB heir Jonathan Oppenheimer has worked as an analyst at NM Rothschild & Sons, and both Evelyn de Rothschild and David de Rothschild have worked as directors at De Beers.)

    So here you have colonisation and privatisation done by exactly the same bank - presumably for exactly the same purposes, to appropriate natural resources for themselves. So how are colonisation and privatisation different?

    The whole neoliberal ideology - privatisation, deregulation and free markets for corporate capital - benefits the same banks. There is nothing new under the sun. It is all a giant fraud.

    We all know how countries develop their economies from history - protectionism, free social services, state led development, but above all domestic ownership of the economy. That is what happened in Japan, China, South Korea, Taiwan, etc. And adhering to that model is why Asia is leaping ahead in leaps and bounds, while Africa stagnates while being bled by the IMF/World Bank policies and conditionalities.

    This is not about competition or free trade. This is about monopoly capitalism and global control - by 1 family.

    Sources:

    (1) Supplement - The sale of ZCCM

    Each package had attracted at least one bid. The bids were to be evaluated over four weeks by ZPA, ZCCM, and N.M. Rothschild and Clifford Chance as advisers to the sale. Preferred bidders would be selected and negotiations initiated. The final deal and decision to sell to a particular buyer in each case was to be subject to approval by the Cabinet and international lenders.

    (2) Bidding closed ZCCM
    www.zpa.org.zm/zccmbids.htm

    " The privatisation of ZCCM commenced in 1996, after GRZ and the Boards of ZCCM and the Zambia Privatisation Agency (ZPA) approved the ZCCM Limited Privatisation Report and Plan presented by UK based financial and legal advisors, NM Rothschild & Sons and Clifford Chance, respectively. "

    (3) Sale and Purchase Agreement on ZCCM Konkola North Mining Prospect ...
    www.zpa.org.zm/konkola.htm

    Upon the successful conclusion of Stage I of the Privatisation Process and the commencement of Stage II - as described in the Phase I Privatisation Report for ZCCM, dated April 1996, prepared by NM Rothschild & Sons ("the NMR report")

    On the hanky panky between NM Rothschild and Anglo-American De Beers, on the allocation of mines, basically to itself. From The UK Government's Department for Business, Innovation and Skills (BIS):

    (4) STATEMENT BY UNITED KINGDOM NATIONAL CONTACT POINT FOR OECD GUIDELINES FOR MULTINATIONAL ENTERPRISES (NCP): ANGLO AMERICAN

    Sorry for the anonymous post, but right now my google account is blocked.

    MrK

    ReplyDelete

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