Q FM Africa's Modern Radio
Former Commerce, Trade and Industry Minister Felix Mutati, says the issuance of the US$1.25 Billion Eurobond has shifted Zambia’s economic fundamentals to the extent of raising its risk factor.
Mr. Mutati has observed that the country’s risk factor is growing high as also noted by the World Bank because its external debt level has now reached the ceiling of 40 percent to the GDP.
He has told Qfm News in an interview that this is why he also suspects that the Minister of Finance Alexander Chikwanda was not able to borrow his target of US$2 Billion.
Mr. Mutati who was Cabinet Minister under the MMD government notes that by issuing the US$1.25 Billion Eurobond he assumes that Zambia has now also become the highly indebted country in the region.
Felix Mutati
He says his worry as Member of Parliament representing the people of Lunte constituency is the servicing of the Eurobond whose maturity is 10 years.
The Former Commerce, Trade and Industry Minister is concerned that if this borrowed money is not invested appropriately to give Zambia a return to create capacities for repaying, the burden will be on the future generations who have not even participated in swelling of the country’s debt.
He has suggested that what government must therefore do specifically for the Eurobond money is to create an Independent Monitoring Unit that is going to enhance the levels of accountability of the money that is borrowed.
Mr. Mutati thinks that this Independent Monitoring Unit will assist government to assess how these resources are being deployed as well as provide periodic information to the people of Zambia on the utilization.
He says this in turn will bring government to account and reverse the current situation where government is currently able to borrow without coming to Parliament to explain how the borrowed money is being used.