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Saturday, 24 January 2015

Lungu takes power, HH concedes defeat

Edgar Lungu (PF) has won with the margin of around 20,000 - 40,000 or thereabouts according to our projections.  Many of you have already been following our Facebook and Twitter updates where we projected this outcome two days ago..

Hakainde Hichilema (UPND) has already conceded defeat in the presidential elections but insists that the elections have been manipulated and stolen from him. He has urged his supporters to remain calm and focus on 2016.

Speaking at a press briefing held at Radisson Blu Hotel this morning, HH says he wont contest the elections results ECZ is about to announce shortly. He instead said his energies will be diverted to the 2016 election campaign.

Four immediate observations. First, these have actually been the most exciting elections that Zambia has ever held. HH is to be commended for being part of that story and for immediately looking forward rather than to the courts.

Secondly, all observers have said this has been the best election Zambia has ever held, perhaps only bettered by 1991. Diplomats have spoken of how proud Zambia should be at how the elections were conducted.

As the Deputy Chief Justice and ECZ Chairperson Irene Mambilima said when dismissing the allegations, "We conducted the poll in an open manner. We witnessed the voting together,we counted together with all parties, we verified together. So if we stole the votes, we stole it together".

Thirdly, following on from the second point, it is unfortunate HH has called the entire election a sham. That undermines the democratic process. It does not strengthen it. Don't throw the baby with the bath water. It is poor leadership.

Finally, and more worrying, it does not appear that HH has recognised just how divisive these ejections have been. UPND only won in three provinces. The elections were close because of higher turn out there.

In short, though UPND's electoral strategy was effective but unpatriotic. They planned to govern Zambia from three provinces. This has deepened the ethnic divide. HH should have used this occasion to acknowledge this and reach out to the other seven provinces.

Copyright © Zambian Economist 2014

Wednesday, 21 January 2015

Zambia Votes

The nation went to the polls yesterday. Here is what we know based on the results we have compiled and information from our experts. 

1. PF has won decisively in Muchinga, Luapula, Northern, Copperbelt, Lusaka and Eastern provinces.

2. UPND has won decisively in Southern Province, Western and North Western. North It has also thrown some not so decisive results e.g. Magoye. 

3. PF has captured  large parts of Central province. UPND has performed reasonably well in some parts. This is more on a level. 

4. Turn out has ranged 30% - 40%. Turn out appears higher in urban areas than rural areas. For example, Copperbelt it has been around 38%. But in Southern Province very low around 30%.  We are cross checking these turn out rates. 

5. Some small parts of Eastern Province and Western have not voted yet. Probably their votes may be irrelevant based on what is coming out. 

We need to run projections based on turn out and existing results. And we shall update you as necessary. 

We are now beginning to get a sense of the overall picture. We will pull together a table of where we are. Thanks to our friend Elias Munshya who has led on this effort.

We should of course remind readers that the only authority on all of this is ECZ. And of course we are economists not pollsters or statisticians.

Tuesday, 20 January 2015

Biofuel investment in Kawambwa

Sunbird Bioenergy Africa is investing US$150 million in the production of ethanol in Kawambwa (Luapula province). Production is expected to commence this year, with capacity of around 120 million litres of ethanol per annum. It is expected that the factory would employ 600 workers. (Source : Times of Zambia)

Chief Mukanta has allocated the investor 20,000 hectares of land in the Luena Farm bloc. The factory would be located between Sub-Chief Muyembe and Chief Chitambo. The investor wants to engage 20,000 out-grower farmers who would supply cassava to the factory once it starts production.

Sunday, 18 January 2015

State of the economy

At the turn of the year the GRZ gave its assessment of the 2014 macroeconomic performance and the outlook over the 2015-17 period. Here the key quotes from Finance Minister Alexander Chikwanda :

“The economy in 2014 has remained strong with preliminary real GDP growth of 6 percent; making Zambia the seventh and tenth fastest growing economy in sub-Saharan Africa and the world, respectively”

Friday, 16 January 2015

Fuel prices fall

Government has reduced the price of fuel substantially in line with its 'cost plus pricing' model. The Energy Regulation Board (ERB) has released the following press statement:

The Energy Regulation Board (ERB) has reduced the pump price of petroleum products by K2.29 for petrol; K2.59 for diesel; and K2.08 for kerosene, which translates into 23.13%, 28.22% and 30.76%, respectively. Wholesale prices of petroleum products have been reduced by 35.93%, effective midnight 16th January 2015.

In determining prices, the ERB uses the Cost Plus pricing model, which operates on the principle that the final price of petroleum products should cover all costs incurred in the supply chain. Wholesale and pump prices are determined based on the cost of each feedstock cargo received. The cost of each feedstock cargo is mainly affected by global crude oil prices and the exchange rate of the Kwacha to the United States Dollar.

Wednesday, 14 January 2015

IMF - Zambia Watch (December 2014)

Happy new year to all our esteemed readers! A lot has happened while we were on break. We hope to touch on these points where possible.

One of the things that happened is that the IMF made a somewhat meaningless visit to Zambia in December 2014. You will recall that IMF had planned to visit Zambia to agree a new funding programme. But given that we have elections next week nothing was going to be agreed with anyone. That said, the IMF did issue a good summary of its perspective on Zambia's economic situation:
Press Release No. 14/589

An International Monetary Fund (IMF) team led by Tsidi Tsikata visited Zambia during December 4-18 to hold discussions for the 2014 Article IV consultation. At the end of the mission, Mr. Tsikata issued the following statement:

“The Zambian economy continues to register strong growth. Non-mining growth has remained close to 7 percent, but technical outages at some mines led to a decline in copper production that is projected to reduce overall real GDP growth to about 5½ percent in 2014. The exchange rate depreciated sharply in the first half of the year. A marked tightening of monetary policy and a boost to international reserves from Eurobond proceeds helped to partially reverse the depreciation and stabilize the exchange rate. Nevertheless, the annual rate of inflation edged up to 8.1 percent in November.