State Of Our Economy

The Government has projected to spend a total of K57.2 trillion on programmes that will make a direct contribution to improved service delivery, economic growth and poverty reduction between 2010 and 2012.

This is contained in the Medium Term Expenditure Framework information release to the public by the Secretary to the Cabinet.

In addition, Government is currently dialoguing on the development of the Six National Development Plan (SNDF) which is expected to be completed over the next 12 months.

Government targets are to direct 18 per cent of total expenditure towards capital projects and to continue to supplement the human resources capacity in the health and education sectors over the next five years totalling 18,500 new employees.

Non essential expenditure is targeted to be reduced in 2010 and this covers reductions in hosting workshops outside workstations, reduction the procurement of non essential motor vehicles, and the reduction of trips abroad.

However, the Government will continue to support Agriculture development through the Farmers Input Support Programme (FISP), Strategic Food Reserve (SFR) programme, and the Food Security Pack. The total package for this support will be around K550 billion.

Government targets for infrastructure development which include rural electrification, roads, schools, and health facilities will cost the treasury around 4.34 per cent of Gross Domestic Product (GDP).

Other key infrastructure programs will include the development of farming blocks and Multi Facility Economic Zones.

Government plans to fund the Citizens Economic Empowerment Fund (CEEF) with K40 billion and aims to pay interest on domestic debt of K1.88 trillion in 2010.

To a large extent the 2010 national budget is already being articulated through these benchmarks and the official 9 October presentation will fill in the details.

It will be prudent to step back and look at the gains and successes of the Fifth National Development Plan and the current Medium Term Expenditure Framework before going in at the deep end of yet another set of development programs. History arms us with information to usefully tackle the future.

Zambia has often suffered from lack of investment into programs that we have adopted. And alas, because the programs are not always domestic but are sometimes regional, we end up being the fertile market for our more organised and committed neighbours.

To mitigate against this phenomenon which has plagued Zambia over the last three decades, we must now link our capital expenditure projects with our expected economic activities in the private sector.

Let’s build MFEZ’s where Zambians will invest. Let’s target road and electricity infrastructure to areas where our people will be facilitated to engage in economic productivity. Let’s focus our CEEF on sectors of activity that will yield good returns for the investors and fit into the domestic and regional development model.

It is encouraging to note that in the Agriculture sector the synergies and linkages from producers, to traders, to processors, to markets, are being strategically developed and this can be emulated in other economic sectors with proper planning and investment.

Alongside the announcements on excerpts of the 2010 budget and the vision for the next Medium Term Expenditure Framework (MTEF) and the SNDP, we note that Cabinet is vigoursly working on the Agriculture Amendment Bill that seeks to ensure market access for small-scale farmers.

The bill which incorporates the warehouse receipt system aims to enable a farmer or groups of farmers to enter into a contract and have their commodities stored so that they can use the storage warehouse receipt to access credit.

This initiative will set some standards for selected food produce and will assign value in a transparent manner thereby attracting the financial sector to support agriculture more aggressively than is the current situation.

This will facilitate increased volumes of trade in the commodity markets and through the Zambia Agricultural Commodity Exchange (Zamace) across the country.

Last Sunday was the deadline for street vendors in Lusaka to voluntarily vacate the streets or be forced out.

This initiative by the Lusaka City Council in concert with the Local Government Ministry and the Home Affairs Ministry is an attempt to clean the streets of Lusaka. K2 billion is being spent on the exercise but our history tells us that the initiative does the trick for a few months after which the streets soon see new vendors.

Street vendors in other cities and towns are likely to suffer the same ultimatums with time.

Although attempts are being made to sensitize the vendors one cannot help stating the obvious – where will I go?

Lusaka City Council has stated that the council was ready to deal with the situation once and for all as vendors had no reason to continue trading on the streets of Lusaka following the opening of the new Soweto Market, which was constructed at a huge cost for the benefit of the traders.

Somebody out there must be blind or irrational. The stalls and spaces in the markets are insufficient in number to accommodate all the street vendors in the city centre of Lusaka. In addition, every year over 200,000 school leavers are poured onto our streets to fend for themselves. It is obvious that if we are to accommodate all the street vendors both present and future, we must have a continuous market building program that will absorb the new entrants each year until the developing job market begins to absorb them.

A brief walk through the various markets in Lusaka reveals that all stalls are fully utilised and there are even street vendors in the markets themselves!

Government and the Lusaka City Council must be realistic. Many residents of Lusaka would rather negotiate with street vendors as they travel through the city, than to bow to their demands at night when they attack our houses due to lack of economic activity after being thrown off the streets.

Published 15 September 2009