Maravi

Enact debt contraction law, JCTR urges govt

Enact debt contraction law, JCTR urges govt
By Kabanda Chulu in Kitwe
Wed 09 Feb. 2011, 04:00 CAT

GOVERNMENT should urgently enact the debt contraction legal framework aimed at increasing transparency, accountability and participation of all stakeholders in the contraction and utilisation of debt resources. This is according to the Jesuit Centre for Theological Reflections (JCTR).

Currently the finance minister is empowered to borrow on behalf of Zambians and this position might result in another debt trap since there has been no transparency and accountability in acquiring debt resources.

Releasing the findings of a case study for Central Province eight water supply and sanitations project which the Zambian government funded through a US$36.9 million loan, acquired from the Africa Development Bank (AfDB) aimed at financing rehabilitation and extension of water supply and sewerage systems as well as ensuring 24-hour water supply availability, JCTR debt resource monitoring project officer Sydney Mwansa said the project had failed despite the huge investments.

“Majority of Kapiri Mposhi residents still have no access to safe drinking water as they still rely on water wells. This is evidenced by the number of wells found in the residential areas where almost each household has a well and a latrine which are placed close to each other thereby increasing chances of contamination and incidences of waterborne diseases,” Mwansa said.

He challenged the government to sit down with all the stakeholders in view of the projects’ failure to improve the living conditions of the people of Kapiri Mposhi.

“There is need for enactment of a debt contraction framework to increase transparency, accountability and participation so that intended beneficiaries have a say on how the project should be undertaken and this legal framework should include Parliament giving approval of all loans to be contracted by government,” Mwansa said.

He said after reaching HIPC completion point, which saw part of Zambia’s external debt cancelled and reduced from US$7.2 billion to US$500 million, it became imperative for the country to ensure that debts remained at a sustainable level.

“However, the country has continued to borrow (current foreign debt stands at over US $4 billion) from international community without legal binding framework of approval from Parliament since CAP 366 of the Laws of Zambia allows the finance minister to borrow on behalf of government,” said Mwansa.

“This lack of legal framework means prudence in loan contraction lies with one individual and Zambia is likely to fall back into the debt trap if this trend continues.”

Labels: AfDB, DEBT, JCTR, SYDNEY MWANSA

posted by MrK @ 6:08 AM