Limits of patience?

Author:Somerville, Keith
Position:Zambia's economic woes test the patience of the people

"The Zambian people and the Government have demonstrated in the past three years that they can face adversity and meet the challenge of change", said Finance Minister Ronald Penza on 27 January, as he unveiled the latest austerity budget to the Zambian Parliament.

But whether the people of Zambia will continue to be so patient, with no signs of improvements in living standards, growing unemployment, and serious question marks over the future of the mining industry, remains to be seen. Also doubtful is the ability of President Chiluba to keep his scandal and faction-ridden Government together.

The day before the budget was presented, Lands Minister Dr Chulu Kalima was sacked and replaced by former Deputy Commerce and Trade Minister Mongashi Kongo. The official reason for the sacking was, according to a State House announcement, "gross indiscipline and irresponsibility".

Mr Penza nevertheless attempted to place the latest round of belt-tightening in a good light. He told Parliament that inflation had been brought down from 100% at the end of 1993 to 35% in December 1994 and that the total external debt had been reduced to $6.2bn from $8bn at the time when Chiluba succeeded Kenneth Kaunda as the occupant of State House. But he had little to offer to relieve the pain of poverty afflicting most of his countrymen.

His stress on growth and privatisation will not have been the most welcome of messages to Zambian workers, even though reform is undoubtedly necessary for the inefficient, corrupt and unproductive state sector. Since Chiluba's Movement for Multiparty Democracy came to have been lost as the Government has implemented IMF and World Bank inspired adjustment policies.

And there is more to come. Hard on the heels of the 1994 liquidation of Zambia Airways has come the liquidation of the United Bus Company of Zambia (UBZ), leaving a further 1,000 employees redundant. And on 31 of this month, ZIMCO (the Zambia Industrial and Mining Corporation) will be wound up, putting another 7,000 people out of work.

A major problem is that the Government is fighting hard to reduce its spending at a time when little foreign assistance is available and it is struggling to cope with the existing foreign debt burden. As it is the Government ran up a $165m deficit in 1994.

The main thrust of policy...

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