Maravi

Let The People talk featuring Mpondela, Kopulande

COMMENT - " Our interest rates as Mr Kopulande said are shocking. " I was astonished to learn that interest rates are set by the banks? Instead of the Ministry of Finance or an equivalent of the Federal Reserve Bank? I guess that is why the government has not control over these 30% lending rates.

Let The People talk featuring Mpondela, Kopulande
Written by Chibaula Silwamba
Wednesday, March 18, 2009 2:06:09 PM
Continued from yesterday

The secondary sector in light manufacturing, building and construction only contributed 11 per cent to GDP and only nine per cent of employment compared to 61 per cent…So the Malaysian government said, ‘No! No! No! This is not correct.’

So they came up with the Malaysian Plan and drove the economy towards manufacturing between 1960 and 1980. They embarked on an import substitution strategy which was in the first Malaysian Plan between 1966 and 1970 and went further to an export-oriented strategy in the second Malaysian Plan between 1971 and 1975.

What results did they achieve? Manufacturing started growing at a rate of 7.7 per cent between 1971 and 1978. They identified manufacturing growth leaders which were wool processing, palm oil processing, they stopped exporting palm oil, they went into processing of their palm oil, they stopped exporting their raw tobacco, they went into adding value to their raw tobacco.

They started actually producing their own textiles, final garments and all that. Instead of exporting their rubber from their huge rubber plantations, they started producing rubber products such as tyres. As at now the manufacturing sector in Malaysia contributes 44 per cent of all jobs that are held in Malaysia.

That is how you can change. Therefore, in this country before we are to learn, what do we need to do? I have failed to understand that for 45 years, we have been talking about this but there have been no serious moves re-engineering our economy and changing the complexion of this economy. We have not all these years.

We start talking about economic diversification only when we are facing a crisis like we are doing now, but economic diversification in what direction? Sam, what is our first priority for manufacturing and unfortunately Sam...I will come to this later.

We talk about economic diversification from the tops of our heads but serious economic diversification has a process and I will talk about what I call the Kopulande Theory of economic diversification. This is the concept that I developed myself which I presented at a conference in Johannesburg as to how, what should be done in diversifying an economy.

I was on radio Phoenix in the year 2002 and I presented this thesis and I was on ZNBC in 2002 at independence and presented the same thesis. No one has ever listened and yet when I presented it in Johannesburg a gentleman from African Union said to me, ‘what are you doing in Zambia, you were supposed to be at the African Union telling us how to change the African economies?’ So there is a process that we must embark on. It has to be a systematic process; I will explain the seven, eight-stage process with economic diversification.

What is needed to be done, probably not at this stage but it is important. Multi Economic Facility Zones, it’s the first serious step going towards industralising our economy, promoting the manufacturing sector. The challenge Sam is exactly what you have said, to what extent do we get Zambians involved in the Multi Economic Facility Zones? What do we need to put in place? Is the law, the threshold limit of US $ 500, 000 really realistic? Today’s interest rates in Zambia is 30 per cent plus. Can you and I go and borrow US $ 500, 000? US $ 500, 000, which is nearly K3 billion now at 30 per cent interest rate and hope to survive?

Now those people coming from outside, who are coming to invest in Multi Economic Facility Zones as foreign investors are borrowing at two per cent. In Japan, actually, interest rates today are 0.1 per cent. So if a Japanese is coming to invest in a Multi Economic Facility Zone in Zambia, he is borrowing at 0.1 per cent, a Zambian is borrowing at 30 per cent plus and you are telling him to borrow US $500, 000 to go and put in that Multi Economic Facility Zone, for God’s sake, let us get a little more serious and create conditions, let us revisit that threshold of US $ 500,000.

The initial concept, I don’t want to say what it was in Multi Economic Facility Zones. We provided for satellite in the Multi Economic Facility Zones but all that has died over time, hence kicking Zambians out because we are all limited to US $ 500,000. Sam, even I cannot borrow US $500,000. Not at 30 per cent! Not in this kind of banking environment!

Here we have situation where we don’t even have a financial institutions that are committed to long-term lending for industralisation. DBZ [Development Bank of Zambia] has been crying for capitalisation. There has been no capitalisation. Even this year in the budget, no funds have been allocated for capitalisation of the Development Bank of Zambia. Where will Zambians go to get funds from to grow their businesses and contribute to the development of their country?

Presenter: Right, you can be able to join us on this discussion on 22 6841 or 226292. Yes Fresher.

Siwale: Sam, listening to my brother Sebastian Kopulande explaining about these Multi Economic Facility Zones, it makes me sad in that our approach to develop, it’s like…[presenter interrupts to pick a call from a listener].

Presenter: Perhaps [before] you finish off, let us pick up this call.

Caller: Good morning Sam and Kopulande good morning?

Presenter: Good morning Proud?

Popular Lusaka caller Mr Proud: Mr Kopulande, I was, we want to say condolence to the rest of Manjata’s as a ruling party from the people of Zambia. We are all sorry we have lost that person [Teddy Manjata who died in a road accident last week]. Including general Tembos. [Former Republican vice-president Lt Gen Christon Tembo who died a week ago]. No matter we can differ politics but when somebody dies you need to say sorry one another.

To come to politics of this time we raised a lot of issues during elections time, so what we need from you panelists is to start seeing results from election time. Now if you yourself Mr Mpondela, you start wondering that no here in Zambia, we don’t have manufacturing industry…what about the issue of election, we raised a lot of issues now we need to see the results. What we only see results now is when you go outside the road in Kamwala as if there is no Ministry of Works and Supply.

When you to go Soweto Market, as if there is no Ministry of Works and Supply, the whole roads are dead, when you go in prisoner, even at the gate of Parliament there is a pothole now. What we see now, we need results from you. We don’t want any cadres who will go to demonstrate of sacking Magande. We are not going to eat Magande this time.

What we need now Mr Mpondela, advise our President to move in compounds to see how people are suffering. We want to see many people in employment. So many people in the Copperbelt are jobless because there is no industry. Not to take cadres to go and demonstrate over Magande. No matter you can remove Magande today as long you can’t mend potholes, the problem still going there. What we want is not to take our President as if he is a cadre now. The President is the President for all. During elections, he said he reconciled with Magande team. What we need now is development. Mr Mpondela advise the President…sugar prices are going up, what is the mistake. Is this the election that will benefit us? The answer is no!

What is wrong with dollar, from K3500 to about K6000? Those issues we want our President to start solving. It was broadcast yesterday that he had a meeting with Zambia National Farmers Union officials. There is no employment. We need our President to look at all these matters not to take our President to go and demonstrate. To demonstrate for what? Who is his enemy? The President should start talking. He should bring medicines in hospitals, give vehicles to police officers in Ng’ombe, Garden and Kamwala compound. Those issues we are going to develop the economy of Zambia, not just demonstrations by cadres. We want development from our President. Thank you very much.

Presenter: We have got somebody on the line. Hello good morning?

Caller: Yes good morning. How are you?

Presenter: Who is calling?

Caller: My name is Rodgers Ng’ambi calling from Lusaka. First of all, I would like to say I have got a lot of respect for Mr Mpondela and Mr Kopulande. These are people who have been distinguished in society and I want to believe them that they can be able to help us a lot. I was saddened to hear that our legislators can go to Parliament and enact laws that are already existing and sometimes contradict with the existing ones, I am very sad.

Also to hear that our reserves are kept in England. What I want to know is Mr Kopulande, he has been well connected, when did he realise that there were these loopholes for him to start talking today? I think that he can use his influence to change all these things because I know that he is a person who has been in the limelight for a long time, even now this man is capable of even going to State House and speak. Where has Mr Kopulande been for all these things to be where they are up to now? Can I have a comment from him please? Thank you.

Presenter: Before we lose that, you comment Mr Kopulande?

Kopulande: Sam, thank you very much. I have spent the last 18 years very closely linked to government. The last 18 years of my professional life since 1991, I entered government as a senior private secretary to vice-president then Levy Mwanawasa, the late president. I worked there and after that, I went to the Ministry of Commerce [, Trade and Industry] as director of industry and I was then promoted to permanent secretary to Ministry without Portfolio and I am pleased to say, I can say that I was actually permanent secretary for then Honourable Michael Sata presently the president of PF [opposition Patriotic Front]. I then moved to State House as controller and permanent secretary. I left government, then went back as special assistant to late president Mwanawasa. Yes it is true I have been closely associated with government.

Now the truth of the matter - is if you look at the service positions that I have held, they have been all advisory. When you are an advisor, your duty ends at advising and you are not the decision maker. Civil servants are advisors, yes we have advised…some of our advice have been taken, others have not been taken. So it is not a duty of an advisor to go screaming on Radio Phoenix that ‘no my advice was not taken’ and all that. No! No! No! Our role is to advise. So we have advised, I have advised, I have known these issues for many years, I have written volumes on these issues and I have never been lazy in terms of advising. Why? Sam, because I have had the privilege to have a good exposure both academically and in terms of hands-on experience to be able to advise effectively and to be able to do the right thing.

Presenter: We have another caller on the line. Hello? Oh, we have lost the caller. You may continue.

Kopulande:…so at the end of the day, these are issues that we are addressing at every point the nation must be ready to look at itself and be able to devise strategies and ways and means to move forward as a nation.

Presenter: Hello?

Caller: Good morning brother Sam Sakala?

Presenter: Yes Mr Konoso, how are you?

Caller Konoso: Good morning Mr Kopulande?

Kopulande: Yes my friend how are you?

Konoso: Morning Mr Mpondela and Siwale. How are you?

Mpondela and Siwale: Okay, how are you Konoso?

Konoso: I am okay. I think Zambia, when I look at ourselves, we are our own worst enemies. Look at the situation of development. I will give Kasaba Bay as a very good example. Here we are, we have a Republican President and he is proud to bring in a foreigner, a Zimbabwean to take over Kasaba Bay. I thought Mr Mpondela there is doing a good job running a lodge in Lusaka, a very clean, hygienic lodge. Why can’t the President take Mr Mpondela and take over Kasaba Bay so that the money is left in Zambia by Zambians for Zambians?

These are little things that make me very suspicious of how are we going to develop if we hate each other like that where it is clear they prefer people from foreign countries to go and take over Kasaba Bay? That is very wrong and I condemn that action.

In fact, when that muzungu [white man] comes to take over Kasaba Bay, he should be chased. Talking about the economic development, we cannot ba Mpondela here in Zambia because our production costs are crazy.

We have Angola which has cheap oil but nobody wants cheap oil from Angola. We want fuel from Kuwait where it can be hijacked by those pirates in the gulf of Eden in Somalia. They are hijacking tankers.

Look at Botswana…it’s a very good country. The Botswana pula is intact; it has not depreciated the way our currency has lost value. In fact the bishops in their pastoral letter, they said the kwacha has collapsed.

So it’s really the way we manage our country. We are managed completely wrongly because why is it that our neighbour Botswana is intact? It’s not really affected as much as we are. Petrol in Botswana is five pula which is K3200. Us here petrol is K5800. So meaning I want to do business and a Tswana man wants to do business, automatically when he wants to export his product, he will be able to make a profit. A minibus driver in Botswana will make more money for the family than a minibus driver in Lusaka.

So already we are starting from a disadvantaged position. We are already crippled before we even talk about development.

Our interest rates as Mr Kopulande said are shocking. All over the world, central banks have cut interest rates to one per cent, two per cent, but here, Zambians we are borrowing from banks at over 30 per cent. Now how do you do business if you are going to borrow money and lose so much money? The way I look at it, the way forward right now since our currency has collapsed, we should start using the US dollar like what they are doing in Zimbabwe because the US dollar for now, you may think it’s a joke, Zimbabwe was also a strong economy, whoever thought the Zimbabwe dollar would sink that way? There is cholera there; there is cholera here, what is the difference?

If you Mr Kopulande had K200 million last year put in a Zambian bank, you would have lost 60 per cent of it, meaning you would have lost K120 million by it sitting in a Zambian bank. If Mr Kopulande you had kept that K200 million in US dollars and you offloaded that K200 million in US dollars right now you would have gained K120 million. So the Bank of Zambia should consider that. Zambia won’t be the first.

Even in Argentina when the currency collapsed they used the US dollar until the currency picked. When it picked that was when they reverted to their currency. The Kwacha has collapsed. In a country where a kwacha is collapsed, you see people smiling all over. We are not supposed to be smiling; we are supposed to be angry.

But we are playing jokes. The other thing, our education system needs to be improved. You are going to put Multi Economic Facility Zones for illiterate people, how are they going to manage? The world has changed. To make a car now is computerised but our children in Bauleni or Chibolya basic schools have no laptops, how do you take that person to go and work in a factory which will manufacture. The illiteracy levels are just too high. We are going nowhere.

Kopulande: Yes Mr Konoso, if I may just answer on your proposal that we start using the US dollar. Yes, the kwacha has collapsed there is no question about that. Just as I was coming to the radio station, I passed through the bureau de change, there is a bureau downstairs the selling rate right now is K5700 as at this morning. Now, not all is lost. There are things that we can do…

Presenter: Let us pick this call then you will continue. Hello?... You can continue Mr Kopulande.

Kopulande: Not all is lost for the kwacha. If we take the necessary interventions…

Presenter: The caller is back. Hello?

Caller (Albert Musonda): I am so concerned about the so-called investors who are purporting to invest in our country but in the end they are just here to loot our resources. Can I take you back during Mwanawasa’s time, when the miners wanted to demonstrate and Mr Mwanawasa went there to attack them that, ‘how can you demonstrate when these people have come to invest in the country and they have given you jobs?’

Surely can you say these people have come to give Zambian people jobs when they are paying them K150, 000? What is that? Can you surely protect and defend the investors at the expense of the Zambians. That is not fair to us. These people when copper prices were at US$4,500 somewhere they enjoyed everything and gave Zambians peanuts, nothing compared to what they got from the sales of our copper. And today they want to pull out. They have cut jobs and have done this and that to the Zambian people. And us Zambians are just there to watch and see what is happening.

I think it is imperative that our Zambian government should stand up and protect Zambian people. This is our country and we never applied to be born in this country and we deserve better than we are receiving at the moment. It’s better for them to…and we remain as Zambians because we have manpower and we can do it. I can tell you we can do it.

What is important is for the government to support the Zambian investors who cannot take everything out of this country but they can invest in this country because they belong to Zambia. We are calling upon the government to protect Zambians especially the mine workers who are suffering and mind you this is a time bomb, people who have lost their jobs might turn to be criminals and the government will not be able to bring that to an end. The earlier the better! It is better for these people to go and we remain as Zambians and invest in those mines. They are here to loot our resources and nothing else. I repeat Zambian people should stand up and protect what belongs to them.

Siwale: Mr Musonda who is the government? You are the government. Now if you yourself do not stand up for what is yours, those you have put in office as leaders will continue to do as they wish because we lost it between 1968 and 1972 when we replaced the institution of government with an individual. So in 1991 when [Frederick] Chiluba came in, we thought we had changed the system, no we had not changed the system, we just changed the individual.

Labels: DECENTRALIZATION, DEVELOPMENT, INTEREST RATES, LET THE PEOPLE TALK, MANUFACTURING, MFEZ, RADIO, SEBASTIAN KOPULANDE

posted by MrK @ 2:05 PM