Zambians are going to vote in the tripartite elections in September 2016 but already the economy is dominating all other issues.
With the loss of jobs in the copper mines as a result of low prices on the world market many voters in the country are worried if the present government of Edgar Lungu would turn the tide around to keep people on their jobs. “I voted for the Patriotic Front (PF) and Lungu as president thinking that he would help the economy and create more jobs. I am now worried with what is happening,” said James Phiri, a retired civil servant.
Zambia’s economy is facing turbulent times with the Zambian Kwacha (ZMK) losing its currency against the US$. The ZMK is now pegged at around 7.5 to US$1 while in January this year the ZMK was trading at 6 to US$1. The high prices of foods on the market is pushing up inflation. “I am just hoping that this situation will not continue to next year,” said Phiri.But Grey Chilufya, an entrepreneur, said the economic situation in Zambia “is not all that serious as some people put it.” “I feel that President Lungu has helped to improve the economy. There is a lot of investments in infrastructure development such as roads that is going on in some parts of the country. This is creating jobs,” Chilufya pointed out.
Poverty levels are high
Majority of Zambians believe that the economy is not all that good especially when they wake up each day only to hear their ZMK has fallen against the US$ and other major currencies. Lungu was elected into office in January 2015 after the death of Michael Sata in October 2014. Sata became the fifth Zambia president in 2011 defeating Rupiah Banda in a highly contested polls.
The next elections will mainly be between Lungu of PF and Hakainde Hichilema of the opposition United Party for National Development (UPND). Lungu, a lawyer and Hichilema, a businessman, were neck and neck in the January Presidential by-elections with Lungu winning the vote by 48% against Hichilema’s 46%. The opposition political parties are accusing the president for loss of jobs in the mines. So far close to 10,000 jobs have been lost since last year. The Konkola Copper Mine has fired 2,650 employees while Glencore, an Anglo-Swiss commodities company cut 4,300 jobs at the Mopani Copper Mine, according the economic experts. The loss of jobs is not doing any good to the ruling PF considering that elections are coming in in 2016. Losing jobs has a multiplier effects on the poor. Those who are unemployed suffer economically because they no longer have the buying power. “When people lose jobs families suffer. Those who have been fired have responsibilities of paying school fees for their children and taking care of dependents as well,” said Angela Chanda. She said government should work out on fixing the economy and this she said would propel Lungu and his party winning the next elections.
Poverty levels in Zambia are high. The African Development Bank (AfDB) estimates that poverty levels are high at around 60%. The Bank further says that the economy remains strong and in 2015/2016 it is expected to grow by over 6% after a decline in GDP in 2013 to 5.7% due to waning copper production, a situation which some other analysts feel has not really changed much.
Despite the closure of some copper mines the AfDB Principal Country Economist, Peter Rasmussen, in an Economic Analysis Report for Zambia, predicted a fall in inflation to below 7.0% by 2017. In 2014 copper production, according to the AfDB decreased by 7% to 708,000 tonnes as a result of “unscheduled maintenance at the Konkhala Mine and the Conveyor collapse at the Lumwana Mine that left it out of operation for a couple of months.”
Zambia has experienced an increased growth rate over the past 10 years but this growth has not translated into equitable distribution of wealth and many people still remain poor. The national data poverty of 2010 shows that 42% of the population lived in extreme poverty. The 2014 Human Development Index ranks Zambia 141 out of 187 countries.
When Lungu came into office early this year his promise was to change all this: improve the economic lives of the people by creating more jobs and and investing in infrastructure development. Very little, however, has changed since then and many people believe that the Lungu administration is not up to the challenge. Apart from low prices of copper on international markets, Zambia is also facing serious power cuts forcing some companies to close down.
President Lungu is hitting back at opposition critics accusing them critic of misleading the population on the job losses in the mines. Lungu said there was little that his government can do to make the international prices for copper to improve and prevent job losses.He said, however, that government was looking into ways of addressing the challenges facing the economy. He also proposes the exporting of maize to other neighbouring countries as a way of having foreign exchange earnings.
Economists argue that investing in agriculture, infrastructure, tourism, telecommunications, wholesale trade and retail will improve the economy and help create jobs in the long term. With the economic turbulence Zambia is passing through, the economy will be the main political campaign tool in the next elections.