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Thursday, 6 October 2011

A Memo to President Sata

By Chola Mukanga

Congratulations, Mr President!

You ran an inspirational, issues based and transformational campaign that has not only earned the presidential seal but has also won the admiration of the Zambian people.  Your victory has rekindled the ancient hope of our people for sound and effective government.  A government that governs in the interests of its people and not in the pockets of powerful foreign corporations or governments.  A government that puts the nation’s most vulnerable before those who live in lavish gated communities; the oppressed before the oppressor; the weak before the strong; and, the poor before the rich.

As you no doubt know, your journey, and that of our nation, has just begun, even as the campaign road has just ended. Over the next few months and years, together we shall face many challenges. The world once again finds itself staring into another global recession, perhaps much worse than the 2009 crisis.  Although Zambia may be far geographically from the current turmoil engulfing the Euro Zone and the United States, in an ever globalised world we are not immune.  We will begin to feel the effects through tightening remittances, slowdown in commodity prices and the inevitable reduction in overseas development aid.  Not to mention the potential negative impacts on our emerging tourism industry. Impacts the world experienced in 2009-10, again threaten us all.

To make matters worse, you have assumed the Presidency at a time of great uncertainty in our region. The Zimbabwean political situation remains volatile with political players in our sister nation seemingly stack in perpetual equilibrium of stagnation.  Malawi is no better with a government there that has failed to rise above petty politics.  To the north, DRC has not fully recovered from Africa’s world war and its historic failure to develop remains a huge constraint to our own advancement.  

Our economy which has grown consistently over the last seven years unfortunately continues to grow slower than many of our regional competitors such as Angola and Mozambique.  To complicate the national equation, it now appears that our already high rural poverty and inequality is forever marching upwards. Our human and physical infrastructure is broken and more than 70% of our people live on less than $1 a day.  Our people are both physical and psychologically broken. As you noted on the campaign trail, there’s an urgent need to “restore our dignity”. It is surely a gross injustice and testament to the MMD regime that a country so richly endowed should fail to nourish the young and secure the future of the elderly.  Our children are being born literally in economic chains, with their future shackled by never-ending corruption and greedy reinforced over two decades of tyrannical rule under the previous regimes especially under the Banda administration.

It’s within this context that I write you this short memo with few broad pieces of advice as you build on an excellent start that has already pressed the reset button in many areas.  

Listen to your instincts. The nation is most fortunate that for the first time we have a President who has a genuine heart for the poor and is comfortable with every strata of our society.  The resonance of your campaign messages is self evident. We now look to you to apply your people centred philosophy to the greatest issues facing our nation. But in doing this you have already recognised that no man knows everything.  Zambia is blessed with many individuals at home and abroad.  You must now do what you can to put together a brilliant group of experts that will provide you the very best advice in the core areas - finance, mining, transport, education, information technology, engineering, manufacturing and health. We no longer need to go down the MMD way of relying solely on advice from the IMF and World Bank. As you said several times during your campaigns, real and effective solutions are home grown. We are masters of our destiny and God has given us that opportunity.  

Consult openly - The failed MMD regime ran government like a personal pig bank as well as a closed shop with no clear consultation with the public. It treated government policy as “personal to holder”. It was particularly notorious for not issuing Green and White Papers as is customary in well ran governments around the globe.  These papers were replaced by poor "Cabinet Policy Papers" that ordinary Zambians never saw or commented on. Zambians were treated with impunity and taken for granted.  Only in rare instances would one outside the ministry be lucky enough to hear the odd "Ministerial Statement" which often was poorly debated in the House.  Consultation is the hallmark of effective government.  Whether it’s restoring ZAMTEL in Zambian hands, away from the failed Gaddafi regime, or restoring the Windfall Tax on Mining or borrowing more externally.  Ordinary Zambians long to have a say in these things.  The use of modern technology to engage the public has not been fully utilised.  Though effort has been made in the past to create Government websites, there’s still no integrated portal for accessing and commenting on important policy decisions.  But consultation must never be an excuse for policy inaction, therefore balance must be found between open consultation and work of the government. We have already seen good fruits of this careful balancing in the way you have excellently dealt with the relics of the old regime. 

Be patient with the critics - Divergence of opinion in government and outside is critical for creative and innovative solutions. It is critical that every tier of our Government emulates your ‘down to earth approach’, in particular the mantra no man is an island.  Rather than seeing people with divergent opinions as "enemies", men and women in Government should now see such individuals as critical partners in ensuring that its policies are perfected. This is a serious point because under the previous administration things became so bad that we start seeing running battles between Government andThe Post. It was sad seeing the previous president engaging in insults and being insulted. His actions did terrible damage to the presidency, which your victory has now gratefully restored. The lesson from Mr Banda’s failures is that antagonism between Government and the media creates an impression of a government that does not listen. More importantly it makes it difficult for those that feel that the holder of the highest office in the land must be respected to come out and say so.  We hope that you will continue the spirit of open criticism and debate that has characterised your campaign and early presidency.  Indeed, there’s room, where appropriate, for those in opposition to advice government. You have already taken an important step in this direction by bringing MMD members within the new ministerial team.  What is now needed is for your new administration to transform how politics is done in our country by moving Zambians beyond entrenched partisan positions, towards more open and direct engagement with the leading opposition parties.  This is good for your Government and it’s good for our people.

Plan for the long term.  The problem with our current rampant poverty levels is that it comes with political pressure for immediate solutions. In finding those solutions there’s always a lurking threat of turning back the clock and implementing dangerous policies that look like they are intended to save the day but imprison us in the long term. The last government failed to plan for the long term, so it started pursuing senseless policies which included, borrowing senselessly;  attracting the wrong investors; eliminate crucial taxes to please a certain group; reducing certain taxes that do nothing for the average person; and,  handover of our resources (and sovereignty) to outsiders. Sadly, it has now become clear that the Rupiah government will most likely be remembered as one of desperate people who did desperate things. The new Zambia you are building must now avoid this at all costs. Yes we should strive for a better today, but equally we should be prepared to take the pain of today to secure a better future for our children. This call for continuous updated long term planning that has the buy-in of all Zambians, as appropriately set out in your manifesto.

Avoid profligate spending.  We all understand the need for Government to act swiftly and respond to queries from specific groups. However, it is important to first recognise that the national budget is not different from household budgets. If money is spent on something, adjustments would need to be made elsewhere. This calls for careful planning to underpin Government’s spending decisions, and most importantly explaining to the Zambian public how those trade-offs are being made.  As you noted in the election campaign, “Zambia is broke”. Under the MMD regime we had become a nation of beggars that continuously feed off debt and foreign aid.  Zambia has a limited pot of funds, and therefore we need to learn again to use it wisely and timely. It’s therefore important that early on in your presidency you are clear on what government can and cannot do, and where its priorities should be. This will allow debate and input from the general public on your general direction.  Again, your instincts and understanding of our people and the advice of your experts will become handy here.

Cut wasteful spending. As you know Government's fiscal space can only be increased in two ways - cutting waste and increasing the funding pot through larger revenue generation.  Given your Government rightly stated b that larger revenue generation will come through widening the tax base through low taxation, there will be need to secure long term sources of revenue.  We are tired of borrowing, especially in the absence of an effective debt management strategy.  That means that not only should we keep a closer rein on spending, but we must actively seek ways to cut wasteful spending. Inefficiencies must be identified systematically. A vital part of this process is “crowd sourcing" of areas where government can cut waste. The public should direct this process by offering ideas as part of a broader “savings challenge” to help create fiscal space. Zambian Economist is in the process of identifying this waste and will soon submit paper on some areas which have already been enthusiastically identified by our readership. We hope such an approach can be applied to specific ministries to help identify savings.

Prioritise the security of our national wealth. We recognise that you have assumed the Presidency after decades of relentless plunder by the previous administrations especially alleged extravagancies and plunder by the Banda administration. You have already done exceptionally well, respecting the rule of law and putting forward a bold case for Zambia to be comfortable with its past while expanding the freedoms of tomorrow.  As you build on a solid start, it would be important to pay attention to securing our national wealth. The most pressing economic question facing our country is how we as a people should harness the vast mineral wealth that is beneath our feet.  In solving this problem it is important to always remember that the current situation of mining companies treating our taxation system with impunity must come to an end. Zambians expect these companies to pay their fair share and to do so without fail. The culture of secret deals and negotiations must come to an end. Government should set an optimal tax and all people and companies must simply follow.  It’s not right that a certain constituency is able to sit down and negotiate their way to certain privileges, while ordinary Zambians quietly obey the laws and pay their taxes accordingly. More importantly we won’t develop as a nation as long as we fail to secure our mineral wealth.

Let us avoid the mistakes of the past. As a Christian nation we are fully aware that it is God who appoints all authority. Honour and power belongs to him alone. The Almighty has placed a burden on your shoulders that he knows full well you can carry. But even as we drive off to a new future, we see in the rear view, twenty years of MMD rule with president after president amassing power for themselves, too insecure in their God given mandate to relinquish control. Every Zambian has the highest hope that your vast experience and heart for the poor means after a 20 year interruption, we now have again a president who longs to serve rather than waits to be served.  A critical way to move forward is to fulfil the well placed hope of every Zambian of having a constitution that will stand the test of time by end 2012. The old National Constitutional Conference championed by the failed regime of Mr Banda was a costly and unfortunate exercise. We cannot afford to waste money on another expensive initiative.

Mr President, the early days of your presidency has already demonstrated your strong commitment to equity, justice and prosperity. As you forge ahead we trust that the principles outlined above will be the emblem of your Government.

In our national service, Zambian Economist

Chola Mukanga is an economist and founder of the Zambian Economist which provides independent economic perspectives on Zambia's progress towards meaningful development for her people

Copyright: Zambian Economist, 2013

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