(LUSAKATIMES) The Price of Graft – To reverse or not to reverse the alleged corrupt sale of Zamtel

The Price of Graft – To reverse or not to reverse the alleged corrupt sale of Zamtel
TIME PUBLISHED - Friday, December 30, 2011, 1:08 pm
By Nkandu Mwenge

As we edge towards the first 100 days of Michael Sata’s reign as president, I can’t help but notice how rigorously his government is fighting corruption. But in all this there is one impending decision that has many people feeling nervous, the possible reversal of the sale of Zamtel.

Many analysts saw the reversal of the sale of Finance Bank by the Zambian government as a highlight of the political hazards of investing in an African country, particularly after a change of government. Faizal Moolla, a banking analyst at Avior, commenting on the reversal of the sale ofFinance Bank in the South African publication Business Day said, “This is the risk of doing business in Africa and if certain political parties are not happy there is the chance they can reverse a deal.”

The likely reversal of the alleged corrupt sale of Zamtel will, if you believe the analysts, scare off Foreign Private Investors. But not reversing the sale could have far-reaching consequences. According to the Bank of Zambia (BoZ) 2010 report on Foreign Private Investment and Investor perception in Zambia, corruption, bureaucracy, electricity supply efficiency and cost continued to affect foreign private investor decisions. This report shows that there is a correlation between Corruption and Foreign Direct Investment (FDI) and that graft is a tax on the Zambian economy. So reversing the sale of Zamtel will send a strong message to corrupt individuals and organisation, improve investor perception of Zambia and reduce the massive inefficiency that takes place when corruption is rife.

I do understand what Mr. Moolla and many other people are afraid of but as a cold-hearted conservative I was angered by the previous government’s frustratingly lackadaisical fight against corruption. And I feel a short-term fall in Foreign Private Investment is a price Zambians should be willing to pay to get rid of corruption.