Maravi

JCTR questions BADEA loan

JCTR questions BADEA loan
By Kabanda Chulu
Friday October 17, 2008 [04:00]

JCTR has questioned finance minister Ng’andu Magande’s signing of the US$8 million loan with the Arab Development Bank when another loan was last year acquired from OPEC Fund for a similar project.

And Jesuit Centre for Theological Reflection (JCTR) coordinator for Debt, Aid and Trade programme Tina Nanyangwe has said the continued external borrowing is posing threats to Zambia’s debt sustainability.

Commenting on government’s US$ 8 million loan with the Arab Bank for Economic Development in Africa (BADEA), Nanyangwe however said conditions attached to the loan agreement were favourable with a 10-year moratorium and 30-year repayment period at concessional rates.

“However, we are aware that the US$ 8 million BADEA loan comes barely a year after government signed a credit facility with OPEC for a similar project. In November last year (2007), government signed a loan with the Oil Producing and Exporting Countries (OPEC) Fund amounting to US$ 6 million.

The loan was also for the rehabilitation of 40 Copperbelt feeder roads to ease movement of produce and inputs in impoverished agricultural areas,” Nanyangwe said. “But works on the Copperbelt feeder roads have not begun and it is not clear, at least, according to the Road Development Agency (RDA) whether it is feasible for all the 40 proposed feeder roads to be rehabilitated.”

Nanyangwe said it was sad to note that even after several assurances by Magande that the government would expedite efforts to put in place a debt policy framework, no marked progress had been made.

Magande was not readily available for comment as he was out of the country for official duty.

And Nanyangwe said the continued external borrowing would make Zambia accumulate unsustainable debt stocks.

She said this situation would also create room for public resource mismanagement.

“For instance, in 2007 the government set aside K129.3 billion for debt repayment but actually paid out a total of K244.8 billion with a supplementary budget of K115.5 billion over and above what was initially planned.”

Labels: BADEA, BOONDOGGLES, CORRUPTION, JCTR, MAGANDE, RDA, TINA NANYANGWE

posted by MrK @ 3:46 AM