Thursday, August 05, 2010

JCTR calls for transparent, accountable govt debt contraction

JCTR calls for transparent, accountable govt debt contraction
By Misheck Wangwe in Kitwe
Thu 05 Aug. 2010, 04:00 CAT

JESUIT Centre for Theological Reflections (JCTR) programme officer for debt, aid and trade Sydney Mwansa has said Zambia needs a transparent and accountable debt contraction law that will compel government to borrow responsibly.

Commenting on government’s recent signing of the US $53 million concessional loan from China for mobile hospitals, Mwansa noted that the issue had raised a lot of concern from various stakeholders because the country had continued to ignore the fact that it needed a more consultative, transparent and accountable debt contraction law.

He said debt had a serious implication on poverty and sustainable development of the country as it took away the country’s resources to debt servicing rather than on social service provision, infrastructure and developmental activities.

“As JCTR, we made a submission to include a law that gives power to Parliament and not the Minister of Finance and National Planning as provided by the current law to oversee and approve all loans to be contracted by government on behalf of the Zambian people,” Mwansa said.

He said the law, if implemented, would ensure that the loans contracted were in line with the development plans of the country and thus avoid unnecessary debates and especially, justifications like the country had seen over the mobile hospitals.

Mwansa said it was disappointing that the NCC failed to reach an agreement of the stipulated two thirds majority votes on the very important proposal from the JCTR and referred it to a referendum.

“Issues of debt are always public matters that affect Zambians. As soon as a loan is contracted, it becomes a public resource and as such, it becomes of public interest as repayment of loans uses public resources derived from taxes. The current law allows the government to contract loans without consultation and without transparency,” Mwansa said.

“As we talk about the mobile clinics or indeed, the hearses and any other loans contracted, let us all reflect on what we are doing to ensure that we have a debt burden-free future. With the draft constitution out and the time for comments already elapsed, there is surely something that could be done to ensure such loan deals and the debates that follow do not occur again.”

He said having suffered under the debt burden, it was imperative that the country learnt a lesson as far as debt contraction was concerned.

Mwansa said with the greater part of Zambia’s debt written off, the country had a chance to not only reorganise and direct her resources towards poverty reduction and infrastructure development but also ensure it borrowed for the right reasons and maintained the debt stock within sustainable levels.

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