Q FM Africa's Modern Radio
The Socialist Party says latest downgrading of the Zambian economy to B negative by credit rating agency, Fitch, reflects a continued downward economic process.
General Secretary Cosmas Musumali says the fact that the chances of stopping this downwards trend are becoming minimal each year, the risk of Zambia defaulting on its external and domestic debt is real.
Speaking at a media briefing held in Lusaka, Dr. Musumali, who is also an economist, says the Socialist Party therefore foresees the next rating of the Zambian economy being worse.
Dr. Musumali states that this is especially that government has in the 2019-2021 Medium Term Expenditure Framework (MTEF) indicated that it plans to contract external debt of US$ 3.4 billion.
He says this new external financing for the next three years will make Zambia’s debt stock more vulnerable to the foreign exchange volatility owing to the global increase in interest levels.
Dr. Musumali states that his party has also observed that lack of transparency and timely debt accounting information by government is being interpreted as a purposeful attempt to conceal the real situation.
And Socialist Party 2021 presidential candidate Fred M’membe says given the implication of the poor ratings and deteriorating macroeconomic condition, government must admit that there is a crisis.
Mr. M’membe says there is need for the Patriotic Front government to win back the trust of Zambians and the international finance market that it can still be entrusted to govern for another three years.
He says this entails government cutting down allowances of top officials by 50 percent, reducing the cost for international travel by 60 percent and freezing mid-term gratuity for Members of Parliament.
Mr. M’membe has further called for the reversal of the decision to increase salaries for the President and other constitutional office holders and forgo plans to purchase a new presidential jet.