‘Goodbye Sovereignty, Goodbye Zambia’

McDike Dimkpa
20% Complete
 01-Oct-2018

‘Goodbye Sovereignty, Goodbye Zambia’. This was part of a comment from one Zambian, Nivlek Ocris, a respondent to the article published by zambiareports.com which was an official statement by Zambia’s Finance Minister, Margaret Mwanakatwe. In her statement, the honourable minister denied any cession of national assets to China, as collateral for Chinese loans.

The minister was responding to an article published on 3 September 2018 by the Africa Confidential entitled “Bonds, Bills and ever bigger debt”, in which it was stated that Zambia had ceded the Zambian National Broadcasting Corporation (ZNBC), Zambia Electricity Supply Corporation (Zesco) and the Kenneth Kaunda International Airport to China, as part of collateral for the huge debt Zambia owed China. She said nothing like that was happening in Zambia.

Besides Africa Confidential, many other platforms and critics have shouted out on how the Chinese was taking over Zambia whose debt to China is nearly $9 billion. So the minister felt she had taken her time to quell the news as she would finally conclude thus: ‘’whilst members of the public are free to comment on our economy, it is incumbent upon authors that their articles should be ethical, professional and factual. In instances where information is lacking, my Ministry is ready to provide clarity so that publications are not speculative, thereby, causing unnecessary excitement with negative impacts on business and livelihoods in Zambia’’.

Well, that is all government-speak. What is paramount is the reality of Zambia’s economy in relation to China. Denial or no denial, is Zambia heavily indebted to China? That is one question. Is there any of Zambia’s national assets totally or partially owned by Chinese firms? That is another question.

On the few occasions that we have written pieces on this platform about the pros and cons of the ever-growing China-Africa relationship, we have been berated by some readers who accuse us of demonising China because they believe the Chinese are doing great things in Africa, especially, such beautiful things that the Europeans did not do. These sympathisers always commented that we should leave the Chinese alone, as they were the best foreign allies that Africa would ever have, if one placed them against the backdrop of years of exploitation by, particularly, European super powers.

However, that has hardly been our stand here. In analysing foreign policies of African leaders, it is not really about Chinocentrism, Eurocentrism or Americentrism. Summarily, what we have majorly preached against is the carefree attitude we suspect of African leaders when they nose around for aids and loans, entering into agreements and signing MoUs that may be of more benefit to, in this case, the Chinese. We have always harped on brainstorming on the real issues confronting even the rural dwellers and how an African president packages these needs on the international discussion table so that whatever agreement they have benefits the Chinese citizen as much as it favours the African citizen.

We have questioned intentions: if it was just about the loans, aids, visible projects that come in handy during campaigns for a next election or if they were having partnerships that will bring the countries out of their current situations in a few years time? We point out that the Chinese are out for business (not saying whether or not they were the perfect business partners); they are not a charity organisation and as a result, they expect to have something in return for whatever they dole out. It was not to chase China out of Africa but to warn Africa of not selling itself again, this time, with open eyes.

Alas, it looks as if Zambia has become the first aid or loan victim. Directly or indirectly, Zambia is becoming a colony of China, however extreme that may sound at this stage.  Of course, Madam ‘Katwe could have my head for that.

Minister Mwanakatwe may release as many statements as she can, on behalf of her boss, President Edgar Lungu. But the question she has to answer is why Zambia has become so embroiled in loans barely ten years after the International Monetary Fund wrote of their debt alongside 29 other countries under the Heavily Indebted Poor Countries (HIPC) scheme. What is all the loans about that the taxes of Zambians keep increasing and increasing to the restlessness of the people?

Critics have always been wary of China’s largess to smaller countries, calling it a debt-trap, where they give loans that would hook in the throat and use the opportunity to gain leverage. True or not true, the case of Sri Lanka stares us in the face. Salem Solomon of Voice of Africa writes: ‘in Sri Lanka, China took over Hambantota Port and thousands of acres of surrounding land as part of a debt forgiveness package, raising concerns about sovereignty’. Who says KKIA is not takable if it comes to that? A debtor must pay up or make it up!

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In Madam Minister’s release, she should have been more detailed about the loans and the stakes shared between Zambia and the Chinese Top Star, in the digital migration of ZNBC. As we speak, the Chinese company holds a 60% stake in ZNBC, and, every income in advertisements belong to them. What more remains for one to say ZNBC now belongs to China when they have up to 60%?

Here is a breakdown of the deals/loans Zambia have with/from China, which are circulating in the web, but believed not to be all as the government is known to keep the deals hidden:

  • Heroes Stadium = US $94 million
  • KKIA = US $360 million
  • Security Wings Housing Project = US $ 275 million
  • Kafue Gorge Lower Power Plant = US $1.7 million
  • Kariba North Bank Power Plant Expansion = US $430 million
  • Lusaka L400 Road = US $300 million
  • Ndola Airport = US $400 million
  • Lusaka Decongestion = US $286 million
  • Topstar Deal-Communication Towers = US $280 million
  • Copperbelt Road C400 = US $418 million
  • Chipata-Serenje Railway Line = US $2.3 million
  • Mongu-Kalabo Road = US $287 million
  • 2,000 Military Houses = US $157 million
  • Mansa-Luwingu Road = US $242 million
  • Mbala-Nakonde Road = US $180 million
  • Lusaka Sanitation Project = US $130 million
  • Kafue Water Project = US $104  million
  • Levy Mwanawasa Hospital Expansion = US $90 million
  • Kafulafuta Dam Water Project = US $449 million
  • Mulungushi Conference Centre Expansion = US $30 million

          Total = US $ 8,542,000,000 

And a Zambian asked the minister: ‘how are we going to pay off this debt?’

Africa Confidential did say that the Zambian government has kept the real amount of what they owe secret, which if they published, would raise more problems and set the people against them the more. If they were wrong with such assertions, the minister should then make the records public. Fighting the media is pointless by merely releasing denial reports; what they should release should be documents that prove rather than statements that counter-attack.

And then there is the talk of misappropriation of funds, which Africa Confidential also raised in their report.

“Financial management across the ministries is under scrutiny. Britain’s Department for International Development is investigating fraud in three ministries, which could have serious implications for future funding. In mid-July Lusaka announced a supplementary budget of 7.2 billion kwacha ($721 mn.). Half of this is for debt service, which leaves only just enough only for public sector salaries, which it is struggling to pay. It missed most August salary payments, causing outcry among civil servants last week. Efforts to raise capital domestically are not going well. The auctions of Treasury Bills have been poorly subscribed on average although it has been using massive inducements to attract the banks. Government data shows that by the end of May it had spent $489 mn. on external debt service and on 19 July it announced a further $161.3 mn. was paid in June. It will need a further $360 mn. over and above the sum originally budgeted to cover debt service.”

Did the minister respond to this? No. she probably did not see that.

The truth, whether the pro-China debaters agree or not, is that Zambia is losing (if not lost) itself to China. With no clear cut way of repaying such huge loan, then ‘goodbye Zambia’.

There is no smoke without a fire. If this smoke is artificial, a false alarm, the already cession of ZNBC, a national media, to the Chinese, is enough to say goodbye sovereignty.

McDike Dimkpa  is a contributor to The African Progressive Economist and the opinions expressed here are his own.


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