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Thursday, 29 September 2011

New Ministerial Team (Updated)

President Sata announced his ministerial team today. The new team has 6 members from the Movement for Multiparty Democracy (MMD) at Deputy Minister and Provincial Minister levels. The President also made some changes to the structure of the ministries. This is perhaps a good time to declare an interest here - my brother Hon Mukanga was appointed as Cabinet Minister for Transport, Works, Supply and Communications. Many congratulations to him! We shall of course hold him and the rest of the team to account as we have always done.

1. Office of the President Michael Sata

2. Office of the Vice President Guy L. Scott, MP
Deputy Minister Edgar C. Lungu

3. Ministry of Justice
a) Cabinet Minister Sebastian S. Zulu
b) Deputy Minister Ngosa Simbyakula

4. Ministry of Defence
a) Cabinet Minister Geofrey B. Mwamba
b) Deputy Minister Panji Kaunda

5. Ministry of Finance
a) Cabinet Minister Alexander B. Chikwanda
b) Deputy Minister Alfreda Kansembe,

6. Ministry of Home Affairs
a) Cabinet Minister Kennedy Sakeni
b) Deputy Minister Obvious Mwaliteta

7. Ministry of Health
a) Cabinet Minister Dr. Joseph Kasonde
b) Deputy Minister Patrick Chikusu

8. Ministry of Foreign Affairs
a) Cabinet Minister Chisimba Kambwili
b) Deputy Minister Dr. Effron Lungu

9. Ministry of Agriculture and Livestock
a) Cabinet Minister Emmanuel Chenda
b) Deputy minister Nicholas Banda

10. Ministry of Labour, Sports, Youth and Gender
a) Cabinet Minister Fackson Shamenda
b) Deputy Minister Rayford Mbulu

11. Ministry of Commerce, Trade and Industry
a) Cabinet Minister Robert Sichinga
b) Deputy Minister Keith Mukata

12. Ministry of Mines
a) Cabinet Minister Wylbur Simuusa
b) Deputy Minister Richard Musukwa

13. Ministry of Information, Broadcasting and Tourism
a) Cabinet Minister Given Lubinda
b) Deputy Minister Forrie Tembo

14. Ministry of Education, Science and Vocational Training
a) Cabinet Minister Dr. John N. Phiri
b) Deputy Minister Prof. Nevelyn Willombe

15. Ministry of Lands, Energy and Water Development
a) Cabinet Minister Chistopher Yaluma
b) Deputy Minister Charles Zulu

16. Ministry of Local Government, Housing, Early Education and Environmental Protection
a) Cabinet Minister Prof. Nkandu Luo
b) Deputy Minister Esther Banda

17. Ministry of Community Development, Mother and Child Health
a) Cabinet Minister Dr. Joseph. Katema
b) Deputy Minister Jean Kapata

18. Ministry of Chiefs and Traditional Affairs
a) Cabinet Minister Inonge Wina
b) Deputy Minister Belinda Kawandami

19. Ministry of Transport, Works, Supply and Communications
a) Cabinet Minister Yamfwa Mukanga
b) Deputy Minister Mwenya Musenge

Provincial Ministers:

1. Central - Phillip Kosamu
2  Copperbelt - Vacant
3. Luapula - Davies Mwila
4. Eastern - Solomon Mbuzi
5. Lusaka - Miles Sampa
6. Northern - Freedom Sikazwe
7. North Western - J. Limata Limata
8. Western - N. Mubukwanu
9. Southern - Katombola Lukulo

27 comments:

  1. How many MPs is the President required to nominate?

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  2. all i can say is good luck Mr president because if you do well my country does well.

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  3. am just curious about the talk of smaller government. 3 ministers less is some thing i guess. smaller goverment?

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  4. Why nominate 10 MPs instead of the constitutionally stipulated 8? I hope he puts legal advisors in place quickly! and starts listening to them. Good luck Mr President and Good luck Mother Zambia.

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  5. yes you save by dropping three ministries. Think of how much it cost to run the entire ministry.

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  6. They already work :-)

    Plunderers will share wealth of Zambia

    ------

    Reuters reports that the tax the Zambian government is getting from mines in Africa’s top copper producer is not enough and may need to be reconsidered, new mines minister Wilbur Simusa said shortly after being appointed to the post on Thursday.
    Simusa’s comments could unnerve investors who were not expecting a major shake-up after newly-elected President Michael Sata assured in his campaign he would not bring back mining windfall tax.
    “The money we are getting from the mines in form of tax is not adequate and we are going to sit down with them and discuss so that we reach a win-win situation,” Simusa, a mine engineer said.

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  7. List updated to remove Willie Nsanda

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  8. Let me see if I have this straight: Let's imagine that I am a household with parents of four children, aged 3, 8, 13 and 18 respectively. The father and the 18 year-old will get their healthcare via the Ministry of Health, but the mother and three younger children go through the Ministry of Community Development, Mother and Child Health?

    Which of the children are educated by the Ministry of Education, Science and Vocational Training and which by the Ministry of Housing, Early Education and Environment Protection? At what age do the children stop being the responsibility of the Ministry of Community Development, Mother and Child Health, and start becoming the responsibility of the Ministry of Labour, Sports, Youth and Gender? Exactly what does a permanent secretary of gender do all day? What does government do for youth that isn't education, health, community development, housing, or any of the other normal functions of government? Is sport really a ministerial level responsibility unto itself rather than a part of community development or home affairs? Seems like there could just be a Ministry of Labour that could concentrate on workers and jobs, quantities and qualities.

    Just what is the distinction between "Communications" and "Information and Broadcasting"? In what ways are these not functions of "Commerce, Trade and Industry"? Looks to me like there is yet room for more consolidation and reorganization of ministries into a more streamlined form. For example, why is there a separate Ministry for Mines? Isn't that just a subset of industry? What functions do they perform that are not redundant with other Ministries with broader portfolios?

    What is the barrier to combining the Ministry of Local Government, Housing, [Early Education - put this in Education, Science and Vocational Training], and [Environment Protection - put this in Lands, Energy and Water Development or make independent agency], with the Ministry of Community Development, [mother and Child Health - put this in Health]. That would give you a single Ministry of Local Government, Housing and Community Development.

    Likewise one could axe the Ministry of Information, Broadcasting, and Tourism. Broadcasting can go with Transport, Works, Supply, and Communications. Tourism is clearly a subset of Commerce, Trade and Industry. Information sounds euphemistic for both propaganda and intelligence, the appropriate functions of which belong in the Ministry of Home Affairs, Ministry of Foreign Affairs, and the Ministry of Defense or the Ministry of Justice as may be the case.

    That knocks three more ministries off the list without losing any of the functions. That means some of the reduction may be cosmetic, in that if there are a thousand bureaucrats with a budget, eliminating their boss and transferring them to another Ministry doesn't necessarily reduce that budget by much. However I would venture that there are significant redundant functions that would become apparent once the work was being done twice on the same ministry budget.

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  9. Yakima,

    There's lack of synergies here!

    It does not appear to have fleshed out properly. A lot of duplication.

    I am sceptical about this Ministry of Chiefs. Better to propose practical and workable solutions within the national and local architecture. Why not just strengthen the House of Chiefs?

    Also we can save money by combining Home Affairs and Justice.

    We also need to see a greater role for Independent Regulators. Why do we need a Ministry of Information and Broadcasting? Why not just a Regulator to deal with that with the remain issues handles by Ministry of Trade and Commerce or a new combined Ministry of Culture, Media and Sports?

    Synergies are missing. Without synergies the costs increase rather than reduce.

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  10. Here we go again. Appointing Kaunda's minister of finance isn't necessarily the best strategy if you ask me! It sends exactly the wrong signals for a Government that is trying to start anew.

    So Chiluba's right hand man is President, and Kaunda's right hand financier is MoF!

    Wonderful...

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  11. I.P.A. Manning (Chosanganga)30 September 2011 at 12:55

    Where is natural resources, and where is Wynter Kabimba? ipamanning@gmail.com

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  12. @kunda just reducing the number of ministers without reducing the size of ministries will not lead to savings. for instance if you merge two ministry having 200 workers into one ministry having 398 less two ministers will certainly not lead to saving.
    if these people maintain there expendures ,structure and increase the expected bureaucracy, cost of maintaining this structure may actually increase

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  13. Chosanganga,

    Dow Jones Wire services are indicating that Kabimba has been placed in charge of the probe into recent oil purchases by ERB from Glencore.

    I am also concerned about proper stewardship of natural resources, but I admit to being uncertain as to an effective structure by which to deliver that. Do you think that a standalone agency can still secure the funding and prosecutorial authority it will need to be effective? Can the political backing for a full Ministry designation withstand the backlash in an atmosphere of cabinet consolidation? Would attempting to make this into a wing of Justice aid or hamper its ability to focus on the task at hand? Was there perhaps method to the madness of placing Environment Protection in with Local Government, if only because that places it within Prof. Luo's portfolio, or maybe because there is advantage to empowering localities to address the issue?

    I would be very interested to hear what sorts of structures, safeguards and resources you think will be necessary to do a more effective job of natural resource stewardship than has been done previously.

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  14. MrK,

    Sounds like proper procedure to me, however the Zambia Revenue Authority needs to properly inform the Bank of Zambia as to how much money should be deposited in government accounts by exporters before this measure can be truly effective. Otherwise all that the BoZ can confirm is that an amount of tax has been paid, not necessarily the correct amount.

    http://www.zra.org.zm/tariffGuide.php

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  15. Yakima,

    BOZ will only have to receive sales payments not tax payments.

    The President said, "nothing will be exported out of Zambia unless confirmation of payments is received from the Bank of Zambia".

    Taken at face value, the implication is that money from all major exports (including copper, emeralds, manganese, timber, etc) must pass through the Zambian banking system. It will of course still be allowed to leak out, but it does give the government greater leverage of all exporters. No one will complain because this is fair - across all sectors, not targeted at one.

    The impact on the Kwacha and the national reserves will be interesting to watch. And of course the impact that may have not just on exports but the economy as all.

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  16. To avoid any more evasions I suggest:-

    1. No export or transit of concentrates
    2. Recreate MEMACO or equivalent and channel ALL copper, cobalt, manganese, nickel, lead,zinc, silver, gold sales.
    3. Price all exports at average LME price for last 30 days less 1.25% commission.
    4. Pay proceeds through special Bank of Zambia accounts on a 80% Dollar and 20% Kwacha
    5. Place the Dollars (20% of Exports) on a prorata basis with all Zambian Commercial Banks on Fixed Deposit.

    Benefits:-

    1. Full and thorough accounting of all metal exports
    2. Improve forex throughput to the economy
    3. Taxes can be collected at source especially mineral royalty, export tax etc.
    4. Eliminate transfer pricing, under invoicing etc.

    5.

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  17. Okay now I am thoroughly confused. The Lusaka Times article makes sense to me if the President is saying in effect, "The items you are exporting cannot leave Zambia until after we have confirmed that you have paid the appropriate taxes." The last four paragraphs make explicit reference to collection or underpayment of taxes. If that is not what this means, then I am at a loss.

    Does it mean that all exporting businesses (or individuals I suppose) must maintain accounts with the BoZ? As I recall the Zambian banking sector is rife with maintenance and transaction fees that can combine with low interest on deposits to actually erode the value of assets being held, especially for small depositors. Would it be possible for, say a small scale gem mining firm, to accept payment in the form of a cheque from an international bank which they could then convert to cash directly via BoZ without maintaining an account there (or does at least one party to the transaction need to do so)?

    How long before it is allowed to "leak out", is this about overnight deposits, or something longer term? I may need to be walked through the utility of this change, is this how export payment settlements are handled under a national system elsewhere so I can get an idea of how it functions in practice?

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  18. Yakima,

    The basic idea of the policy is to stop the following.

    An exporter sells minerals to someone in Switzerland for an amount that only they know truly! That money is directly paid into a Swiss account without ever passing through the Zambian banking system.

    That is the problem they are trying to solve.

    So what they have said is that from now on - BoZ must get confirmation that money has entered the Zambian banking system e.g through a notice of payments from whichever bank the exporter uses. After that BoZ iwould then authorise shipment through the exporting authorities.

    No one has to have an account with BoZ. BoZ is merely there to confirm such transactions by coordinating the banks and notifying the exporting authorities.

    The key is that money must come to Zambia. So if Zambia sold $10bn worth of minerals - that must have passed through the banking system first.

    This is an important innovation. It does not impose capital controls, since the money can always be taken out. But it does have other huge issues e.g appreciation of Kwacha, potential violatily, etc

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  19. On BOZ the cliche that 'the only thing history teaches us is that we never learn from history 'comes to mind.

    There was a good reason Chiluba's govt downsized BOZ when he came into power.

    BOZ under Kaunda had grown into a bloated, parasitic, corrupt institution- stifling and suffocating private and public enterprises.

    The Chiluba-MMD may have overreached by removing all forex controls. And definetly something needs to be done about regaining control of the flow of money in the country. But giving BOZ the effective Veto power on exports will only end badly. That is the bureaucrat's ultimate dream come true.It's the ultimate position to exact rents. It is a corruptors and corruptees paradise.

    We have to wait for the details to see how it will work. Will it cover all exports or will there be thresholds? I see a large self serving bureaucracy developing.

    Let us be careful - The road to hell is paved with good intentions

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  20. Kaiba,

    I agree we need details, but we also need international benchmarking to understand how these things are done in other countries.

    I believe the model being proposed is one used by Chile, among other countries.

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  21. Actually BOZ was not downsized it is actually bigger than it was in the 1980s. It now fills two big Office blocks the Annex and the Main Building which are both something like 8 stories high.
    Furthermore it is a far more active and interventionist regulator, as well as having a bigger economics department as well as adding a payment systems unit, IT is far bigger than it was in the past also. BOZ Ndola is the one that has reduced in size with functions transferred to Lusaka as well as Automation doing away with others.

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  22. Anonymous I do not think BOZ has grown in size. Go to the BOZ website www.boz.zm and you will see that the head count in 1964 was 100. It grew to 400 by 1975 , 1226 in 1988 and by the time Chiluba started to dismantle the bureaucracy in 1994 it was at 1400.It is currently at 850.

    The physical space ( buildings - office space has not been added on for a long time- as far as I can see from the outside. Definitely not from 1994 .

    True it is more active in policy and regulation. That is the core function and it needs to do more of that.But for it to start issuing papers before someone can export...? I do not think so!
    There are already too many licences, too many hoops to jump through without having to add another one.

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  23. Cho,

    I tracked down what I think is the Chilean procedure you were referring to, it seems that they use a mechanism called the Formal Exchange Market (scroll down to Subtitle 7). This April 2011 bulletin from Ernst and Young helps to explain the mining and metals tax regime a little bit, and this Q&A while slightly out of date attempts to outline the role of the industry in the economy.

    To quote Question and answer 24: What restrictions are imposed on the import of funds for exploration and extraction or the use of the proceeds from the export or sale of minerals?

    Funds must be imported to Chile through a member of the formal exchange market (FEM) formed by all commercial banks, certain exchange houses, stock brokers and some entities authorised by the Central Bank. The investment of capital in Chile and the repatriation of an investment and its profits must be done either under chapter XIV of the Compendium of Foreign Exchange Regulations of the Central Bank of Chile or under DL 600. The first procedure is a mere registration of the investment with the Central Bank and it is available to individuals or legal entities irrespective of their domicile or residence and does not convey a prior approval. DL 600 offers investors the opportunity to enter into an agreement with the Republic of Chile to bring foreign capital into the country under terms that are guaranteed not to change, and it is available to individuals or legal entities domiciled or resident abroad investing more than US$5 million. In regard to mining projects, as long as the companies fulfil certain specific requirements, the length of the agreement can be longer.

    Exporters may choose either to bring the foreign currency resulting from an export transaction into Chile or to maintain such foreign currency abroad by making investments, paying import operations or foreign loans. If an exporter chooses to bring the foreign currency into Chile, there is no obligation to bring the foreign currency into the country through the FEM nor to convert it into Chilean pesos.

    The applicable regulations provide for compliance with certain reporting requirements regarding the outcome of the relevant export and the use of the foreign currency.


    Moving in the Chilean direction on regulation and taxation seems reasonable given their relative success at both growing their mining sector and extracting revenues from it for public needs. Provisions authorising their Central Bank to "verify that the value of goods and services . . . is consistent with their current value in the international market", are encouraging. The Bank is not the only oversight though, as "The provisions of this Section [45, of Law 18,840] shall be understood to be without prejudice to regulations for customs or tax valuation, under the competence of the National Customs Service, Internal Revenue Service or other agencies."

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  24. Kaiba it means BOZ is much more efficient than in the past which is a good thing. BOZ has expanded its activities to regulate more an more effectively. It has taken on economic monitoring an modelling in a big way. It has created its own well run and funded pension scheme. It has fully embraced the ICT revolution. It has an aggressive portfolio management policy for foreign exchange reserves and has a legal department that has even won landmark cases against vulture funds and the like. This has all been done with a reduced head count. I am very impressed !!!!

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  25. Another interesting provision of the Chilean mining codes is that they require a certain amount of refined metal outputs to be reserved for the use of their own domestic industries (currently about 75,000 tons of refined copper per year). It is unclear how much of a subsidy said domestic industries get when obtaining metals from the reserve, however its existence is a clear sign that Chile is committing at least some resources towards fostering import substitution of finished products made at least in part with their own raw materials.

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