Newly-elected Zambian president, Hakainde Hichilema, says he plans to unveil a new set of economic policies after his official installation on August 24.
He made the announcement at a news briefing at his home in the new Kanyama district in the capital, Lusaka.
Hichilema says his plans are aimed at jumpstarting the economy, tackling external debt, taming inflation, creating jobs for youth and inspiring the confidence of international investors.
“Bally will fix it” was a major election campaign slogan for Hakainde Hichilema, meaning “father will fix it”. Hichilema says his experience as a successful businessman - - and one of the richest men in the country - - uniquely places him to find solutions to the economic challenges facing the country.
Chibamba Kanyama, a prominent Zambian economist, says the president-elect will have to contend with a myriad of challenges including "crushing debt", as he tries to jumpstart the slumping economy.
"The first is the debt. We call both the domestic debt and external debt as the elephant in the room. At the moment, this is a big problem because our debt to GDP ratio is in fact now over 100 percent. The second one is unemployment. Unemployment levels are significantly high. The third one has to do with the mines.”
According to the database Trading Economics Global Macro Models and Analysis, Zambia's unemployment rate is expected to top 15 percent this year.
An African Development Bank report shows the economy fell into a deep recession due to the global coronavirus pandemic, contracting nearly five percent. It also warned the government to stop accumulating external debt and curb sharply rising public spending to attain debt sustainability.
The warning came after Zambia became the first African country to miss interest payments of $42.5 million on $3 billion worth of bonds. Kanyama says the external debt of $12 billion is unsustainable.
Hichilema says the debt is choking development. At the news conference, he said his administration's economic policies will encourage foreign investors to do business in Zambia. He plans to hold negotiations with lenders as part of the effort to ease some of the economic pressure from the debt.
"Today is the day I can say to the debt stockholders that we have a new administration that will take debt seriously...come to the table, we will discuss options that are available. We will ensure that there is equity in the treatment of your debt...We will do an arrangement with you that will allow us the headroom to release resources and apply those resources on the equation side of investment, revenue generation and not consumption.”
The prevailing economic conditions, economists say, do not inspire investor confidence. The president-elect agrees, and promises to reverse that perception.
"Once we restore the rule of law and order, it's an ingredient to economic development. Once we restore the rule of law, you will see more investments, you will see more economic activity. We will start from there."
Kanyama says the new administration must find solutions to the recent nationalization of under-performing copper mines by the outgoing administration. He says the government has had a poor record of managing mining companies over the years.
Kanyama also says agriculture is one of the sectors of the economy that can give Hichilema a quick win if his policies help farmers and attract youth to agriculture to reduce unemployment.
"It's about agriculture which has really not done as well as we anticipated. So, he has to address that. The other one is to inspire confidence and promote national unity. The country has been divided on tribal [and] regional lines."
Hichilema -- a farmer who routinely describes himself as a little "cattle boy" — says his administration plans to boost agriculture with new economic incentives. There also will be support for youth, he says, to become entrepreneurs and business owners to reduce unemployment.
Zambians say they look forward to the new president fulfilling his promise to create jobs, reducing the inflation rate of nearly 18 percent and improving living conditions.