Ex-BoZ Governor warns against negative talk

NEGATIVE sentiments will worsen the country's debt situation if left unchecked, former Bank of Zambia Governor Caleb Fundanga has warned. Speaking at the Public Debt “Indaba” dubbed “Addressing Zambia's Economic Challenges for a stronger Future” Dr. Fundanga attributed speculations on the current debt situation to lack of effective communication from government officials. ‘’It is important to note that negative sentiments can worsen a country‘s debt situations as the spreads in the yields of existing debt situation will widenl, therefore it is important that citizenry and government officials desist from making negative statements on the matter,” he said. And Dr. Fundanga expressed concern that some government officials had the tendency of talking ill about the IMF bailout when the organization was critical to the country's economic recovery. ‘’Recently, we have seen different stakeholders including government officials making ill statement about the IMF. We should note that although the IMF may not bring all the financial resources to solve the indebtedness of the country, its presence reassures other players who may even have more resources than the Fund,” he said. Meanwhile Dr. Fundanga says despite the Chinese Loans not being clear, Chinese investment was critical to the development on any country. He has however recommended that there is urgent need to publicize the terms and conditions of Chinese loans so as to explore ways by which future debt can be contracted to ensure that it does not undermine the future growth of private business in any country. ‘’Despite having huge investment in different counties, the terms and conditions of Chinese loans are not well publicized the way Eurobonds are, that’s why we are recommending the Chinese publicize the terms and conditions of loans so as to explore ways by which future debt can be contracted,” Dr Fundanga said. And speaking at the same event Ministry of Finance Permanent Secretary for Budgetary and Economic Affairs Dr. Emmanuel Pamu says government remains committed in addressing emerging threats to the advancement of its development agenda, including rising debt and vulnerabilities in public financial management. Meanwhile Civil Society for Poverty reduction Executive Director Patrick Nshindano was hopeful that the Indaba will come up with solutions to the current debt situation.