Union Gold Chairman Mark O’Donnell on 28 September cautioned the Ministry of Finance against policy experiments as they have adverse effects on the business environment. O’Donnell said this during a PricewaterhouseCoopers post budget analysis cocktail held in Lusaka.
“We need to stop this wreck-less experimenting with the economy. We can’t just announce things, create havoc in the market and then eventually reverse them, Mark O’Donnell said.
“Public statements about VAT and the fraud have been issued. As tax payers surely we have a right to know what is going on. The VAT system must be audited so that we know who authorized the refunds and where they went. And I’m calling on you Minister to please find audit what went wrong with the the VAT system,” he said.
“Minister it is evident that our debt is becoming unsustainable and is taking away allocation of resources from other productive sectors of the economy. Minister there is only one organization that can help us reorganize our situation and that’s the IMF. We have to certainly start talking to the IMF and we certainly appreciate your views on the IMF talks,” he said.
O’Donnell highlighted lack of mention of the private sector in the budget which he said was available to help stimulate growth in this economy. He said the budget was very centered on government with very little clarity on how the private sector fit in the framework.
He attributed the decline in mining output this year to uncertainty in the tax environment. O’Donnell said Zambia’s copper productivity was at par with Chile, yet because of tax changes the South American red metal producer now records output 6 times that of Zambia.
In response on an IMF talk query, the Minister of Finance said it would be presumptive to talk about the Washington based lender before meeting set benchmarks through the current fiscal consolidation in progress to restore Zambia to fitness. Dr. Ng’andu said talks at Article IV mission team level have continued and further that in his last Washington visit, the Minister engaged the IMF for a representative for the Zambia office which the lender agreed to address.
The Kwacha Arbitrageur