(REUTERS) Corrupt Ratings Agency Fitch Punishes Zambia For Upholding Rule Of Law
COMMENT - Reuters, owned by the same family that owns Anglo-American De Beers, Rio Tinto and sits on the board (with 'special shares') of The Economist Magazine, is afraid that governments may actually examine the legality of the privatisation they are driving. So much for their chants of 'rule of law'. All they want is for their corrupt deals to be protected.Fitch revises Zambia outlook to negative
Fri Mar 2, 2012 8:34am GMT
Zambia's President Michael Sata speaks to journalists at the 18th African Union (AU) summit in Ethiopia's capital Addis Ababa January 30, 2012. REUTERS/Noor Khamis
JOHANNESBURG (Reuters) - Fitch revised Zambia's rating outlook to negative from stable on Thursday, citing concerns about the direction of economic policy in the southern African state.
"The revision ... reflects the agency's concerns about some of the government's recent actions and announcements, which bring into question the direction of economic policy," Fitch said in a statement.
The agency affirmed Zambia's short-term issuer default ratings at 'B' and the country ceiling at 'BB-'.
It said Zambia's recent decision to reverse a privatisation deal could undermine property rights, while planned reforms of the mining and banking sectors could negatively impact investment and consequently macro-economic stability.
"The government's decisions to reverse the privatisation of Zamtel and investigate the privatisation of Zanaco represent perhaps the most worrying recent development," Fitch added.
The new government of President Michael Sata is investigating the 2007 sale of a 49 percent stake in state-owned Zanaco Bank to Rabobank, in a case that could lead to a reversal of a deal involving foreigners.
It has also said it will take full control of fixed-line operator Zamtel from Libyan owner LAP Green Networks after an inquiry in November ruled the 2010 transaction illegal.
"A further concern surrounds a recent announcement by the Central Bank to significantly increase the minimum capital requirements for the banking sector," said Fitch.
"Although the government's objective of increasing the size and capitalisation of the banking sector is laudable, Fitch is concerned about the potential impact on asset quality, inflation and foreign bank participation in the sector."
Labels: BANKING, CORRUPTION, FDI, NEOCOLONIALISM, NEOLIBERALISM
posted by MrK @ 4:28 PM
1 Comments:
" The new government of President Michael Sata is investigating the 2007 sale of a 49 percent stake in state-owned Zanaco Bank to Rabobank, in a case that could lead to a reversal of a deal involving foreigners. "
Involving foreigners - I guess that is why Fitch never flinched when the corrupt MMD confiscated Rajan Mahtani's Finance Bank, and almost sold it off.
I guess dr. Mahtani doesn't count as 'foreign' enough to warrant protection by the 'rule of law'.
I guess protection, or is that exemption, from the 'rule of law' only applies to the well connected.
End all FDI, only use foreign capital when it involves low interest loans, never ownership. Limit ownership in Zambia only to Zambian nationals, of whatever origin.
Otherwise, the government will be corrupted by pressure from trillionaires, their enterprises, and the governments whose armies act as their business enforcers.
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