Zambia: Is Hichilema’s reform agenda even possible after inheriting ‘empty coffers’?

By Sofia Mapuranga
Posted on Wednesday, 29 September 2021 13:14, updated on Thursday, 30 September 2021 19:18

Zambian President Hakainde Hichilema in Washington DC, US on 27 September 2021. Twitter/@HHichilema

Zambia's new President Hakainde Hichilema has set the stage for his government by declaring a zero tolerance approach to corruption and a new set of reforms. However, lurking in the background is the fragile economy he inherited from former President Edgar Chagwa Lungu. Will the new leader be able to follow through on such promises given the discovery of just how empty the state’s coffers are?

In his opening speech during the first session of the 13th National Assembly, Zambia’s new president said the new administration will pursue constitutional and electoral reforms as he fulfils the election promises made by his United Party for National Development (UPND) to the electorate, which voted him into office.

With regards to the country’s economic situation, the president said: “Rebuilding our economy is top on our agenda, as this is what will deliver jobs, and better livelihoods for our people. We have indeed inherited an economy that is in dire straits and requires bold and decisive action to be taken to ensure recovery.”

Zambians welcomed the pronouncement, but observers say the UPND-led government should have revealed an implementation timeframe to avoid ‘mere rhetoric or failure’.

‘Literally, empty coffers’

In an interview with the BBC, Hichilema revealed that he had inherited ‘literally… empty coffers’ and described the development as ‘horrifying’. He accused his predecessors and their allies of trying to make unauthorised, last-minute movements of funds.

“We’re just sort of digging in now. For example, the debt position itself was not fully disclosed; and we are picking issues around that. We are picking issues around movement of cash which is really not supposed to be the case. We will be on top of things very soon in terms of knowing the extent of the damage that has been done, but there’s been a lot of damage,” said Hichilema.

It’s been a difficult seven years because we inherited a very difficult situation. We saw what’s been left in the treasury. It’s empty…”

Lungu’s administration had not ‘fully disclosed’ Zambia’s debt situation, despite promising to achieve a real GDP growth rate of at least 1.8% during the last 2021 budget address to the nation on 25 September 2020.

According to the Bank of Zambia, the country’s external debt increased to $16,445 in 2020, from $15,049 in 2019.

That includes:

  • $3bn is in Eurobonds,
  • $3.5bn is in bilateral debt,
  • $2.1bn is owed to multilateral lending agencies, such as the IMF, alongside another $2.9bn of commercial bank debt.

A quarter of this total debt is held by either China or Chinese entities via deals shrouded in secret clauses.

In 2020, Zambia defaulted on its loan repayment facility, while credit ratings firm S&P Global reports that the nation spends at least 30% of its revenue on interest payments alone to entities that it owes.

Joseph Kalimbwe, UPND’s information and publicity secretary, tells The Africa Report that his party inherited a ‘catastrophic’ political and economic state from Lungu.

“It’s been a difficult seven years because we inherited a very difficult situation. We saw what’s been left in the treasury. It’s empty. There is no money in the state coffers because they have wiped out everything and this nation was being driven into a ditch. Those mistakes must be corrected. We have a big responsibility lying ahead and [the] thrust is now on rebuilding that and ensuring that Zambia stands on its own two feet,” says Kalimbwe.

We would have loved for the president to give a timeframe [for] reforming this law to avoid [it] being done in an election period and thereby [making it prone to] high chances of [failure]…”

Political analyst, lecturer and researcher at the University of Zambia, Alex Mwamba Ng’oma says: “Reforms in the procurement of goods and services within government should address corruption, perceived or real policy consistency in the economy.”

“The new administration’s thrust should aim to build and encourage investor confidence; stimulating the economy to create growth and thereby also create jobs for the youth. Focus should also be on constitutional reforms to address lacunas, promotion of national unity, through balanced government appointments, so that no tribes feel ignore, marginalised, or neglected. The existing laws should promote professionalism to rid the state machinery of caderism,” he says.

Public Order Act

Hichilema’s election victory is the third time an opposition leader in Zambia has defeated a sitting president since 1991. His election campaign was based on promises of reforms to grow the economy, alleviate people’s suffering, restore the rule of law and end corruption.

Boniface Chembe, the executive director at Southern African Centre for the Constructive Resolution of Disputes (SACCORD) says the Public Order Act (POA) is the starting point to set the tone for reforming the others.

Chembe describes the POA as archaic calling on Hichilema’s justice ministry to pick up the issue and identify past problems in reforming this law.

Enacted in 1955, the POA aims at maintaining the rule of law, but human rights defenders argue that previous leaders, including former president Lungu, have used it as a tool to undermine human rights, which is essential for democracy.

For example, its vague and broad provisions have been used by the police force to limit several fundamental human rights including freedom of expression, peaceful assembly and association, according to pro-democracy campaigners.

“This should be the new president’s focus as he has been strong on calling for unity in the country in the run up to the elections and when he [shot up] to victory. Once the POA is reformed it will become a source of unity, harmony, tranquility and peace in the country and ultimately contribute to his vision of a united country,” says Chembe.

“We would have loved for the president to give a timeframe[for] reforming this law to avoid [it] being done in an election period and thereby [making it prone to] high chances of [failure]. The minister and ministry of justice must pick up this issue and be able to highlight the past problems in reforming this law and the new approach that will be used to have it reformed,” he says.

Human rights abuses under Lungu

Although no timeframe was specified, SACCORD welcomed Hichilema’s pronouncement during his opening speech: to embrace democracy as well as good governance and provide maximum support to the operations of civil society in the country.

“We trust and believe that through this pronouncement, Human Rights Defenders (HRDs) will be allowed to execute their mandate with the full security that they deserve and with a legal framework that will take care of their interest,” says Chembe.

During Lungu’s tenure, human rights organisations reported increased incidences of intimidation, harassment and arrests of members of the opposition, and government critics.

  • In June 2016, one of Zambia’s oldest daily newspapers, The Post, was shut down, accused of owing taxes to the government; its owners were also said to have suffered abuse, harassment, beatings and arrests at the hands of security officials.
  • The media also reported that on 29 September 2017, a group of human rights defenders – including Laura Miti, Lewis Mwape and singer Pilato – were arrested after they marched to parliament demanding answers regarding the procurement of 42 fire trucks that cost an estimated $42m.
  • In December 2020, a state prosecutor and a UPND activist were killed when police fired live bullets at a crowd that had gathered near police headquarters to protest the harassment of Hichilema.

“We [know] that what lay[s] ahead is a difficult task so the UPND’s primary focus is to ensure that we deliver on the elections promises. On reforms, our election manifesto is clear on what we want to do in terms of job creation, political freedoms, corruption, the capture of state institutions and economic recovery and we want to fulfil those election promises without fail,” says Kalimbwe.

Lungu’s government had even tried to effect constitutional amendments through the controversial Bill 10, which critics likened to a ‘grave’ of democracy.

Observers argue that the bill would have given the sitting president powers to appoint judges and ministers, and enabled him to change the electoral layout and take control of the central bank monetary policy. It would also have taken parliament’s oversight role over the executive, thus creating a constitutional dictatorship.

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