Behind the Rising Cost of Living
This week the Jesuit Centre for Theological Reflection (JCTR) has stated that the socio-economic crisis in Zambia has worsened. Among the challenges facing the country the JCTR identified hunger, depreciation of the kwacha, high levels of debt servicing, and the high cost of living.
According to the group the cost of living again increased over the last month, largely as a result of the rise in price of items such as mealie meal, which rose from K113 per 25kg in October to K132 per 25kg in November.
There are several underlying factors behind the trend, that if left unattended to will fuel further deterioration of the socio-economic situation in the coming months. Chief among these are corruption, economic mismanagement and waste.
Corruption allegations continue to plague the Government. As the former Lusaka Archbishop Telesphore Mpundu stated this week “Corruption is rampant and is not being punished, haven’t we heard about all these fire engines that cost us huge amounts of money and ambulances that cost so much. Zambia is the only county that has 48 houses that built themselves without owners.”
Aside from the infamous fire engine scandal, the cost of road infrastructure projects under the PF has become notorious for alleged corruption. Estimates by the opposition state that Zambia has paid as much as six times the amount to build its new roads as compared with neighbouring countries, but no-one has been held to account for the over-spend or pocketing the extra.
Economic mismanagement is evident both in the Government’s failure to prioritise spending on essential areas, as well as its continued borrowing. In 2018 alone external debt rose from $8.74 billion to $10.05 billion, while in 2019 $2.6 billion in additional external loans were contracted. Borrowing comes at a cost and thanks to PF contracted loans Zambia now spends around 40% of its total on budget on debt repayment.
When it comes to waste Zambia is stuck paying huge sums to import power despite having the potential to generate far more than it needs domestically. In September of this year Zesco Managing Director Webster Musonda confirmed that imports from South Africa would cost an estimated $21 million per month. The Government’s failure to maintain existing power facilities, as well as to invest in new projects has left the country in the dark.
Meanwhile, the PF Government continues to pursue expensive policy proposals. For example, the current proposal to increase the number of constituencies in the country from 156 to 235 will come at huge cost to the taxpayer with no clear benefit for the people.
In order to improve the socio-economic situation Government must tackle these areas as a matter of urgency. However, as the JCTR notes, “These difficulties have been compounded by leadership gaps at all levels and a lack of political will to set and adhere to priorities that are of benefit to the majority of the population.”
