Volume 1 - July 2008

Volume 1 July 2008

Fugitive spymaster in Mozambique

OVER a meal of fresh prawns, at an exotic restaurant near the beach
in Mozambique, a Zambian family on holiday spotted fugitive former in-
telligence chief, Xavier Franklin Chungu alias ‘XF’ enjoying a drink.
He is not a rare sight on the beach front, so they were told. Chungu is
comfortably living in Mozambique with frequent traveling to several Eu-
ropean and African countries. We hear his application for political asylum
has received positive consideration from the Mozambican government.
The asylum application was mainly pushed through the United Nations
High Commissioner for Refugees (UNHCR). The Zambian government
did not openly object to the asylum application. As this was happening,
the Taskforce on Corruption was also cutting a deal with another fugitive,
Moise Katumbi, a Governor in the Democratic Republic of Congo. The
corruption charges and allegations against Katumbi were unceremoni-
ously dropped by government, further fueling suspicion on the motive be-
hind these deals. Former Zambian Ambassador to the United States Atan
Shansonga was quietly escorted out of the country to his base in London
by the Taskforce on the pretext that he was going to collect incriminating
documents against Chungu and ex-President Frederick Titus Jacob Chi-
luba. Transparency International Zambia President Rueben Lifuka has
questioned these deals, arguing that the entire anti-corruption fight by
President Levy Patrick Mwanawasa has been put under a serious litmus
test. Taskforce chairman Maxwell Nkole believes the Katumbi deal was
worthwhile but he is not giving
the nation full disclosure. Con-
spiracy theories abound. Was
Chungu helped by the state to
escape?

The first attempt by Chungu

to escape using a light aircraft
in Mansa was thwarted by
the intelligence officers in the
area. The plane, registered in
the Democratic Republic of
Congo (DRC), was alleged to
have been chartered through
Pilatus Engineering owner,
Josef Niklaus Huweiler, who
was also at large. Huweiler is
back in Zambia and attempts
to arrest him over his role
remains elusive. Chungu re-
mained in Zambia for a while
under constant security sur-
To pg 4

Contents
Mwanawasa flirting with a snake - Page 2 Banks - Washing dirty linen - Page 8

MMD presidential woes - Page 3 Inflation - Missing the target - Page 11

Justice Mumba to head ECZ - Page 5 Diplomacy - Levy, Mugabe fights on - Page 13

Who’s who? - Page 7 Financial Briefs - Page 15

Executive Issues
News Volume 1 - July 2008

NCC - Mutilating
Mwanawasa –
flirting with a snake
FOR the last one month, controversy has raged over the “reconciliation” be-
tween President Levy Patrick Mwanawasa and his once arch-rival Michael

Chilufya Sata or ‘King Cobra’. Details of the so-called reconciliation have re-
mained sketchy , plunging their respective political parties into serious internal
gossip. Sata has remained cagey over the deal to the extent that he is avoiding
discussing the matter even with his close party lieutenants. Inside the ruling
Movement for Multiparty Democracy (MMD), the situation is no better. Senior
party officials, most of whom have previously worked with Sata, strongly be-
lieve Mwanawasa is not being strategic in his dealings with Sata. “You can’t
trust Sata,” said Mundia Sikatana, former Minister of Foreign Affairs, who re-
members the day Sata joined the MMD in 1991promising not to occupy any
position. But within a short time, Sata gladly took up successive senior posts
in the party. So, many MMD members, especially cadres, are unsettled by this
latest development.
Sata is politically astute and playing his game can be dangerous. We gather he
plans to use his ‘reconciliation’ to destabilize the MMD as it picks the succes-
sor to Mwanawasa. That way, he is said to believe, he could re-launch himself
politically . ‘Mwanawasa is no longer an issue now since he is going,’ Sata
reportedly told one of his lieutenants when asked about the reconciliation. One
of the key agenda items he wants to test Mwanawasa on is the constitution-
making process. Sata’s strategy is to push for the reorganization of the ongo-
ing National Constitutional Conference (NCC) to include on their own terms
the Church mother bodies and the Oasis Forum, which are boycotting. If he
succeeds , he will claim victory, justify his new partnership and woo the politi-
cal support of the churches. Also key to the “reconciliation” is his deteriorating
health. He may need to make a further call on the public purse for future medi-
cal treatment in South Africa, which is fully guaranteed if he remains in good
books with government. His wife, Dr. Christine Kaseba, is believed to be play-
ing a vital role in influencing his new course. PF Vice President Dr. Guy Scott
understands very well the suicidal political game Sata is playing. That is why
he had offered that the party refunds government expenses incurred by Sata
in South Africa. He was ruled out of order. Outspoken PF spokesperson Given
Lubinda is even more confused over the deal. He was never consulted despite
being a member of the Central Committee, which is yet to meet to discuss the
matter. But PF insiders do not expect anything tangible from such a central
committee meeting since the body is packed with Sata’s place men. Only Scott,
Lubinda and PF chairman of legal affairs Wynter Kabimba could dissent.
Some close family members are worried about Sata. They say he has been
devastated upon finding on his return that his closest and favourite son, Chi-
lufya, had died. He avoids talking about it, which they say is unusual for Sata.
Equally, worrying to them, is the fact that he has been issuing media statements
instead of quietly mourning his son until after a certain period.
the Constitution
BEHIND the scenes lobbying, talks and negotiations are underway to
get the key civil society and religious bodies join the ongoing National
Constitution Conference (NCC), which they are boycotting. Stanely
Mhango, President of the Forum for Democratic Process (Fodep) is
spearheading the initiative, which has so far, proved unsuccessful.
The Oasis Forum, comprising the Council of Churches in Zambia
(CCZ), the Zambia Episcopal Conference (ZEC) and the Non-Gov-
ernmental Coordinating Council (NGOCC) has refused to change
their mind and join. The Oasis Forum, together with some labour
organizations led by the Federation of Free Trade Unions (FFTUZ) in
Zambia are demanding a thorough review of the NCC Act, mainly to
reduce government representatives, if they are to join the process.
The boycott by these crucial groups may seem to be a failure for now,
but the impact may be felt once the document is submitted to the Ref-
erendum for adoption. The Oasis Forum plans to campaign against
the NCC-produced document for lack of credibility. NCC chairperson
Chifumu Banda has pleaded with the boycotting groups to rescind
their decision, knowing too well that the credibility of his draft con-
stitution will be unacceptable among Zambians. Some donor aid
agencies have also tried to convince the Oasis Forum and its allies
to try and fight from inside the conference, arguing that constitution
making is a long battle. NCC Deputy Secretary Newton Nguni met
some of the civil society groups to try and get them on board but to
no avail. The resistance has been strengthened by the government
move to pack the NCC with mainly unknown pastors and NGO lead-
ers who sympathize with the ruling Movement for Multiparty Democ-
racy (MMD). By and large, the composition of the NCC is considered
too large for any constructive debate.
Mutilating the Mung’omba Constitution

Some financiers of the PF have also been demanding a change of manage-
ment in the party. They want the strangle hold on the party of Sata and Scott
relaxed and replaced by a more democratic leadership with more party func-
tionaries taking on a role. They also want party funds to be channeled directly
to provinces and districts as opposed to the secretariat in Lusaka. They want
Sata to reconcile with the ‘rebel’ Members of Parliament who defied his order
to stay away from the NCC. Sata has remained adamant and refused to drop
charges against the Dr. Peter Machungwa-led lawmakers, insisting that they
are indisciplined. Efforts are on going for the two camps to meet
and resolve their differences. A national conference is planned for
The role of the NCC seems misplaced. Recent sittings of the commit-
tees of the conference clearly demonstrated a lack of understanding
of the role of the NCC. It appears the committees were duplicating
the work already done by the Wila Mung’omba led Constitution Re-
view Commission (CRC), whose Report and Draft Constitution are
the working documents for the conference. Instead of validating the
two documents, NCC has resorted to receiving submissions from the
To pg 3

later this year but few PF members believe it will take off.

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Volume 1 - July 2008
NCC - Mutilating the Constitution
same people who presented their views to the CRC. This approach
has been criticized by many experts who think the process will now
be lengthened. “They are mutilating a good document without any
reason,” said Joyce Nonde, FFTUZ President, whose organization
decided to stay away from the NCC. The absence of former com-
missioners who served on the CRC makes it difficult for the NCC to
have institutional memory on the recommendations made in the draft
constitution. This has led to the duplication of the work by inviting
same petitioners to appear and give the same views they provided
to the CRC.
Interesting, some of the consultants who worked with the CRC have
been re-engaged by the NCC to perform the same tasks. The NCC
needed the services of the draftspersons as opposed to the general
consultants as if they are rewriting the entire documents. For sure,
the final document that will come out of the NCC will be totally differ-
ent from the Mung’omba’s widely accepted draft constitution and it is
likely the Referendum will throw it out depending on how organized
the Oasis Forum and allies will be. So far, the role of civil society
groups appears confusing and unfocussed. Maybe, it is a wake up
call to them to embrace new strategies and leadership.
MMD PRESIDENTIAL WOES
THE race for President of the ruling Movement for Multiparty Democ-
racy (MMD) is quietly heating up. The MMD is divided into different
camps, with members shuffling around self-anointed presidential hope-
fuls. Names keep propping up as possible successors to President
Levy Patrick Mwanawasa. The President himself seems to be losing
grip on the party and may not contain the rancorous atmosphere which
is slowly building up within. The Christine Moonga, affair was only the
tip of the iceberg. The now expelled member of the National Executive
Committee (NEC) was always a political nonentity but she managed
to hit the party where it hurt when she openly accused Mwanawasa
of practicing tribalism. Moonga is well connected to the party heavy-
weights, who include her husband Paul Moonga, an ex-MMD Lusaka
District chairperson as well as Mbita Chitala, the recently sacked Am-
bassador to Libya. Many more disgruntled MMD cadres are patiently
waiting for their turn to join the Moonga bandwagon, which is slowly
beginning to roll.
As insiders fight, most United National Independence Party (UNIP)
members are quietly jumping ship to join the MMD. Their main attrac-
tion is the possibility of seeing current Vice President Rupiah Bwezani
Banda or ‘RB’ become President. Banda, a veteran politician and diplo-
mat, has never renounced his UNIP membership. So many UNIP mem-
bers see him as their own man. Strategically, he has stayed away from
the ongoing campaign by his lieutenants who are pushing his name as
the suitable successor to Mwanawasa. Chief among the campaigners
is Lusaka Province minister Lameck Mangani and Deputy Information
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News
minister David Phiri. The ‘Chewa boys’ is their new tag, referring to
their tribe, which is also Banda’s lineage. They seem to have played
their cards well in organizing the party in the Eastern province but
their uncompromising maneuvers angers fellow Easterners. For
sure, Banda is now a key leading candidate for the MMD presidency
even though he has consistently refused to be drafted saying he is
too old for the job. Opposition Members of Parliament like working
with Banda, who avoids controversy even in parliament. However, his
chances will depend on whether Mwanawasa will openly give him the
support and his ability to spread his messages to other areas.
Another old man’s name has recently surfaced within the MMD -Wila
Disraeli Mung’omba (69 years) or WDM as he is fondly known among
his peers. He has not publicly stated his position though some senior
party officials have already started canvassing for his possible entry
into the race. Mung’omba is not much of a ‘people’s person’ though
he has impeccable credentials. His main weakness will be in dealing
with grassroots members. “He is a Muzungu (whiteman),” one insider
said. But his resume speaks volumes of a man widely unknown by
the young generation in Zambia. Former Member of Parliament for
Mporokoso during the Kenneth Kaunda era, Mung’omba is a qualified
lawyer and banker who once served as President of the Africa Devel-
opment Bank (AfDB) (1980-85). He is a shareholder and chairman
of New Capital Bank Plc and sits on several boards of companies in
Zambia and abroad. He chaired the Constitution Review Commis-
sion (CRC) from 2003 to 2006 which drafted the constitution widely
seen as representing the people’s will. But it is unlikely that Mwa-
nawasa can back him after he produced a Constitution that literally
went against the President’s wish. Another threat he has is his distant
involvement in internal MMD politics. He is a northerner and elder
brother to the late maverick politician, Dean Namulya Mung’omba.
The young Turks have not been left out of the race. Stan Bwalya
Chiti, a lawyer, is among the “busybodies.” He has been meeting with
key potential backers within the party in readiness for the launch of
his campaign. Chairman of Goldman Insurance, Chiti is not politically
known, though he briefly served as Member of Parliament for Mpika
and consecutively on the African Parliament. He tried to contest for
the MMD Vice-President at the last convention but the elections were
called off. ‘He needs to grow,” said one of the senior party officials.
He is a northerner and looks to be financially ready for the battle. But
he is also too smart for grassroots politics though he wears a very
friendly demeanor.
Sebastian Kopulande, an ex-aide to President Mwanawasa is equally
in the race but very few people take him seriously. He has been ap-
proaching strategically placed people to back his bid but it appears a
lot of them do not think he will go far. Mbita Chitala is another politi-
cian who should be watched closely. Not that he can turn tables, but
he has the capacity of causing consistent troubles in the
MMD, which can eventually weaken the party. He is more of
To pg 4
HIGHTLIGHTS
News Volume 1 - July 2008

From front pg
Emily Sikazwe –
Faces fresh
deportation

VJ, FTJ reconcile
Former President Frederick Titus Jacob Chiluba has
joined the reconciliation club and has made peace with
his one time close friend and confidante, Vernon John-
son Mwaanga or ?VJ?. The two fell out after President
Levy Patrick Mwanawasa appointed Mwaanga tothe
position of Information minister, prompting mistrust be-
tween the two. At that
time Chiluba was having a big fight with Mwanawasa
following allegations that he stole millions of dollars
when he ruled Zambia from 1991 to 2001. However,
after a spell in government, Mwaanga equally fell out
of favour with Mwanawasa and he was unceremoni-
ously sacked from cabinet. Thereafter, Mwaanga re-
tired from active politics.The reconciliation of Chiluba
and Mwaanga coincided with that of President
Mwanawasa who made peace with his long-time
archrival, Michael Chilufya Sata of the Patriotic Front.
We hear, United Party for National Development
(UPND) President
Hakainde Hichilema or ?HH? is making overtures to
Sakwiba Sikota, or ?Saki? to re-join the UPND which
he left on the ground of tribalism. Sikota runs the small
United Liberal
Party (ULP).There are indeed ?no permanent enemies
in politics but permanent
interests.?
Diplomacy - More pack bags
go is on his way back after his stint in Windhoek.
Nyirongo, who also once served as Zambia?s
Ambassador to Belgium, has been recalled and re-
placed by former presidential aide, Mavis Muyun-
da. Muyunda worked as poitical advisor to Presi-
dent Levy Patrick Mwanawasa from 2001 until she
was retired from her post early this year.Zambia?s
deputy Ambassador to China, Chilufya Kapwepwe
has also been brought back home after serving for
several years in missions abroad. Chilufya, daugh-
ter of Zambia?s liberation struggle hero, Simon
Mwansa Kapwepwe, served as deputy High
Commissioner in Namibia before her Beijing ap-
pointment. She is being replaced by
Zambia?s first secretary in Washington.
Kapwepwe?s ?purge? came at a time when her
sister, Chileshe Kapwepwe was also unceremo-
niously removed as Managing Director of the Na-
tional Airports Corporation (NAC), in a move the
authorities said was to stop her from ?going for a
third term?. Few knew that the principle also ap-
plied to parastatal chiefs.Zambian Ambassador
to Japan, Godfrey Simasiku, we hear, is probably
next on the flight home. Former Central Province
deputy minister, Kennedy Shepande will replace
him, so we are told. Shepande, former a member of
parliament and chief whip of the opposition United
Party for National Development (UPND) joined the
ruling party in 2003.

Zambia High Commissioner to Namibia Griffin Nyiron-

From front pg
Fugitive spymaster in Mozambique
veillance. However, he quietly sneaked out of the country in what the
nation was told an ‘escapee’. But the ongoing deals and counter deals
in the fight against corruption raises a lot of questions on his escape.
Over and above, Chungu has been seen flying around European capi-
tals, with a base in Portugal. How did he get the European visa? Many
ask. More complicated is the fact that his passport was confiscated and
deposited in the magistrate’s court in Zambia as part of his bail
condition. So, how did he get the new passport? Chungu has
been seen openly checking-in at airports in the Democratic Republic
of Congo, Kenya, Rwanda, South Africa and Mozambique as well as
Portugal, Belgium and France without any difficulties.
The absence of Chungu in court has, no doubt, made the corruption
cases more complicated. He was at the apex of the corruption allega-
tions. However, it also puts his co-accused, mainly Faustin Mwenya
Kabwe, Aaron Chungu and Chiluba is a precarious situation.

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Volume 1 - July 2008
Labour – minister quizzed over new Bill
The Zambian delegation, headed by Labour and Social Security Minister
Ronald Mukuma, was quizzed by the International Labour Organisation (ILO)
in Geneva for introducing an obnoxious amendment Bill to the Industrial and
Labour Relations Act. Workers should be thankful to Joyce Nonde, President of
the Federation of Free Trade Unions in Zambia (FFTUZ), who put up a spirited
lobby in Geneva during the ILO annual meetings. Despite having been left out
of the government delegations, in preference to the rival Zambia Congress of
Trade Unions (ZCTU), Nonde managed to find her way to Switzerland to put
the Zambian case in perspective. An ILO committee on freedom of associa-
tion summoned Mukuma with his delegation to explain the rationale of the new
amendment Bill, due to be presented in Parliament in July. The UN agency is
reported to have prevailed on Mukuma and his Permanent Secretary, Ngosa
Chisupa, to immediately withdraw the Bill and not to table it until the discrimi-
natory clauses were removed. In particular, ILO wants Zambia to convene a
meeting with trade unions to agree on the content before proceeding.
ILO contends that the proposed law, which President Levy Patrick Mwanawasa
said will be passed without changes, is a total violation of international con-
ventions on labour. In particular, the proposed amendment that requires trade
union leaders to be employees was ruled to be a violation of Article 3 of the
ILO convention number 87, which promotes freedom of association. No doubt,
the proposal was targeted at Nonde, an outspoken union leader, who is cur-
rently serving as General Secretary of the Zambia Union of Financial and Allied
Workers (ZUFIAW) despite having retired. Nonde previously worked for the
Justice Mumba to head ECZ
PRESIDENT LEVY MWANAWASA has quietly appointed Supreme Court
Judge, Florence Ndepele Mwachande Mumba the new chairperson of
the Electoral Commission of Zambia (ECZ), subject to ratification by the
National Assembly. Mumba, one of the most experienced legal minds in
Zambia, was tipped to takeover as Deputy Chief Justice when Justice
David Mberere Lewanika passed on. However, her name was suddenly
dropped in preference for the younger , Justice Ireen Mambilima, who
has since been appointed, ratified and sworn in as Deputy Chief Jus-
tice. We hear there was a lot of talk over her proposed appointment, with
some questioning her parent’s nationality. However, despite missing the
key judicial appointment, Justice Mumba is believed to have the best cre-
dentials to handle the ECZ. “She is a tough woman, so politicians should
watch out,” one lawyer remarked.
Mumba appeared before the Select Committee of the National Assembly
on April 21st, appointed to scrutinize Presidential nominees. Her name,
backed with impeccable credentials, is expected to pull through the Na-
tional Assembly without difficulty. But who is she?
Florence Who?
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News
state-run Zambia National Building Society (ZNBS). “In other words, the ILO
supervisory bodies consider that provisions which require all trade unions of-
ficers to be actually employed in the respective occupation or undertaking are
contrary to the guarantees set forth in the Convention…,” ILO told the Zambian
delegation. Interestingly, ZCTU President Leonard Hikaumba, who was part
of the Zambian delegation, did not raise objections to the Bill in Geneva even
though his Secretary General, Ian Mkandawire, had written to ILO to express
objections to the Bill. But on May Day, Mwanawasa said the Bill was being re-
jected by trade union leaders because they had personal interests to serve and
some wanted to overstay in office. However, former Secretary to the Cabinet
and Labour Commissioner Sketchley Sacika disagreed with the President,
arguing that trade union members should decide on their own as to who should
rule them. “The election or appointment of officers of a trade union is a matter
for the members of a trade union, and the labour commissioner should have
nothing to do with such elections,” Sacika argued.
But government insists that the Bill is aimed at protecting workers from leaders
who misuse their contributions, strengthen the collective bargaining process
by introducing ‘one-union, one-industry’ principle to avoid formation of splinter
unions and prevent the public from being affected by strike actions in the so-
called essential sectors. Under the proposed bill the minister will have wide
powers to declare any sector essential. [ok]
Judge Mumba was born on 17 December 1948 in the copperbelt town of
Mufulira in Zambia. She began her legal career in 1973 when she was
called to the Zambian bar. She practiced law for many years before she
was appointed Director of the Department of Legal Aid in 1978. In 1980,
Mumba was appointed Judge of the High Court. She headed various
national commissions. In 1989, she was appointed Investigator-General,
which is Zambia’s Ombudsman, a post which she held until her appoint-
ment as Supreme Court Judge in I997.
On the international scene, Judge Mumba represented Zambia at the
Conference on Women in Nairobi in 1985 and at the African Regional
Conference on Women in Senegal in 1994. Within the International Com-
mission of Jurists, of which she has been a member since 1993, she
participated in the work of the Committee of Legal Experts for the Protocol
to the African Charter on the Establishment of an African Court on Human
Rights organised in South Africa in 1995. Finally, Judge Mumba took part
in the Sixth World Conference of Ombudsmen as African Regional Direc-
tor and Vice-President of the International Institute of Ombudsmen held
in Argentina in 1996.
She has also been a member of various national and international com-
missions such as the Commission of the Law Development of Zambia
from 1976 to 1979, the Council of Law Reporting Editorial Board of Zam-
bia from 1981 to 1983, the Council of Legal Education from
To pg 6
News
MMD PRESIDENTIAL WOES
THE race for President of the ruling Movement for Multiparty Democracy
(MMD) is quietly heating up. The MMD is divided into different camps, with
members shuffling around self-anointed presidential hopefuls. Names keep
propping up as possible successors to President Levy Patrick Mwanawasa.
The President himself seems to be losing grip on the party and may not
contain the rancorous atmosphere which is slowly building up within. The
Christine Moonga, affair was only the tip of the iceberg. The now expelled
member of the National Executive Committee (NEC) was always a political
nonentity but she managed to hit the party where it hurt when she openly ac-
cused Mwanawasa of practicing tribalism. Moonga is well connected to the
party heavy-weights, who include her husband Paul Moonga, an ex-MMD
Lusaka District chairperson as well as Mbita Chitala, the recently sacked
Ambassador to Libya. Many more disgruntled MMD cadres are patiently
waiting for their turn to join the Moonga bandwagon, which is slowly begin-
ning to roll.
As insiders fight, most United National Independence Party (UNIP) mem-
bers are quietly jumping ship to join the MMD. Their main attraction is the
possibility of seeing current Vice President Rupiah Bwezani Banda or ‘RB’
become President. Banda, a veteran politician and diplomat, has never re-
nounced his UNIP membership. So many UNIP members see him as their
own man. Strategically, he has stayed away from the ongoing campaign by
his lieutenants who are pushing his name as the suitable successor to Mwa-
nawasa. Chief among the campaigners is Lusaka Province minister Lameck
Mangani and Deputy Information minister David Phiri. The ‘Chewa boys’ is
their new tag, referring to their tribe, which is also Banda’s lineage. They
seem to have played their cards well in organizing the party in the Eastern
province but their uncompromising maneuvers angers fellow Easterners. For
sure, Banda is now a key leading candidate for the MMD presidency even
though he has consistently refused to be drafted saying he is too old for
the job. Opposition Members of Parliament like working with Banda, who
avoids controversy even in parliament. However, his chances will depend
on whether Mwanawasa will openly give him the support and his ability to
spread his messages to other areas.
Another old man’s name has recently surfaced within the MMD -Wila Disraeli
Mung’omba (69 years) or WDM as he is fondly known among his peers. He
has not publicly stated his position though some senior party officials have
already started canvassing for his possible entry into the race. Mung’omba
Justice Mumba to head ECZ
1985 to 1990, the Electoral Commission from 1992 to 1994 and the Unit-
ed Nations Commission on the Status of Women from 1992 to 1995.
In 1997, Judge Mumba was appointed Judge of the International Criminal
Tribunal for the former Yugoslavia on 20 May 1997. Among the famous
cases she handled includes: The Prosecutor Vs Drazen Erdemovic, The
Prosecutor Vs Anto Furundzija, The Prosecutor Vs Dragojulb
Kunarac et al., The Prosecutor Vs Milan Simic and the Prosecu-
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Volume 1 - July 2008
is not much of a ‘people’s person’ though he has impeccable credentials.
His main weakness will be in dealing with grassroots members. “He is a Mu-
zungu (whiteman),” one insider said. But his resume speaks volumes of a
man widely unknown by the young generation in Zambia. Former Member
of Parliament for Mporokoso during the Kenneth Kaunda era, Mung’omba
is a qualified lawyer and banker who once served as President of the Africa
Development Bank (AfDB) (1980-85). He is a shareholder and chairman of
New Capital Bank Plc and sits on several boards of companies in Zambia and
abroad. He chaired the Constitution Review Commission (CRC) from 2003 to
2006 which drafted the constitution widely seen as representing the people’s
will. But it is unlikely that Mwanawasa can back him after he produced a Con-
stitution that literally went against the President’s wish. Another threat he has
is his distant involvement in internal MMD politics. He is a northerner and
elder brother to the late maverick politician, Dean Namulya Mung’omba.
The young Turks have not been left out of the race. Stan Bwalya Chiti, a
lawyer, is among the “busybodies.” He has been meeting with key potential
backers within the party in readiness for the launch of his campaign. Chair-
man of Goldman Insurance, Chiti is not politically known, though he briefly
served as Member of Parliament for Mpika and consecutively on the African
Parliament. He tried to contest for the MMD Vice-President at the last con-
vention but the elections were called off. ‘He needs to grow,” said one of the
senior party officials. He is a northerner and looks to be financially ready for
the battle. But he is also too smart for grassroots politics though he wears a
very friendly demeanor.
Sebastian Kopulande, an ex-aide to President Mwanawasa is equally in the
race but very few people take him seriously. He has been approaching stra-
tegically placed people to back his bid but it appears a lot of them do not
think he will go far. Mbita Chitala is another politician who should be watched
closely. Not that he can turn tables, but he has the capacity of causing consis-
tent troubles in the MMD, which can eventually weaken the party. He is more
of an anarchist and strives where there is trouble. Depending on which camp
he will support, Chitala can, at times, be a good mobiliser of grassroots sup-
port. Former Member of Parliament for Mbala, Chitala is one of the founder
members of the MMD.
To pg 7
tor Vs Blagoje Simic et al. As Appeals Chamber Judge, she sat on various
cases: The Prosecutor Vs Dusko Tadic, the contempts proceedings insti-
tuted against Milan Vujin and The Prosecutor Vs Zlatko Aleksovski.
Her major achievement was when she was elected Vice-President of the
ICTY between November 1999 and November 2001. After her term end-
ed, she returned to Zambia where he sat on the Supreme Court bench
until her recent appointment as chairperson of the ECZ.
She married Fleming Mumba , a renowned Lusaka motor rally driver who
died this year in a traffic accident.
Volume 1 - July 2008
Dr. Katele Kalumba or ‘Ka Ka’ is one of the most watched politicians in
the battle for succession. He has been in the race for the presidency for a
longtime now though his close associates say he has given up because of
the protracted cases of corruption against him. He has conspicuously gone
quiet, leaving most key decisions to his deputy Jeff Kande. Kalumba is very
popular in the MMD and cadres see him as their messiah. Two key issues
work against his presidential bid. One, he is from Luapula Province, which
produced Zambia’s second President Frederick Jacob Titus Chiluba. Most
Zambians would love the presidency to rotate to other provinces. Second, his
involvement in the corruption cases has terribly dented his image for public
office. Member of Parliament for Chiengi, Kalumba is one of the longest serv-
ing lawmakers in Zambia. He remains a man to watch.
Inside cabinet, the battle is even hotter. Of late, Finance Minister Ngandu
Peter Magande appears to be taking a strong lead ahead of his peers. Mwa-
nawasa has a soft spot for him because of his articulation on the country’s
economic policy. But too, he lacks party grassroots connections. Formerly
with the opposition United Party for National Development (UPND), Magande
plays his cards well. He is a media man and journalists love him because he
does not carry any ‘airs’ around him. Former Secretary General of the ACP
Countries, Magande’s resume is equally impressive. He hails from Southern
province.
Next in the race is foreign minister Kabinga Pande, a North-westerner.
A journalist by profession, Pande worked as Public Relations Manager at the
Bank of Zambia before he joined politics. He is very friendly and likes associ-
ating with the grassroots supporters of the MMD. ‘He gives us attention when
you are talking to him,” said one cadre. However, his political experience is
very minimal though he strategically won the position of deputy chairman of
the MMD at the last convention. Mwanawasa may just back him if he runs
out of options.
Felix Mutati, commerce minister, personally sells his candidature through his
impressive articulation of national issues. But odds are against him. He is a
Bemba from Northern Province and it is unlikely that Mwanawasa can give
him support. Crucially, he seems to be a ‘show off’ and cadres detest him for
that. Though he usually helps them once in a while when they are in trouble.
Home Affairs minister Lieutenant General Ronnie Shikapwasha and Health
minister Brigadier General Brian Chituwo’s candidatures will be the most dif-
ficult to sell. Firstly, they are widely seen as part of the family tree of Mwana-
wasa. Therefore, any perceived family ties to Mwanawasa will disadvantage
such a candidate. Clearly, they will not go far. As for Shikapwasha, who calls
himself reverend, some have raised concerns over his leadership when he
was in Zambia Air Force (ZAF). He will have an uphill battle should he decide
to throw his hat in the ring.
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Who’s who?
Wila Mung’omba – The old man and the medals
Wila Disraeli Mung’omba’s (WDM) name is now constantly mentioned in
political circles as the potential successor of President Levy Patrick Mwana-
wasa. [See our main story]. Even though he has never openly indicated his
position on the matter, he has become the subject of discussions among some
Zambians. The bow-tied man and former President of the Africa Development
Bank (ADB), is the recipient of six Ordre Nationale du Merit or Order of Merit
medals bestowed on him by the Governments of Ivory Coast, Cameroun, Togo,
Tunisia, Senegal and then Zaire (now Democratic Republic of Congo). He has
also been decorated with the Honour of Distinguished Diplomatic Services by
the Government of South Korea as well as the Honour for Distinguished Ser-
vices to Development in Africa by Mercury International.
But who is WDM?
Born on October 18, 1939, Mung’omba is a Lawyer, Banker and Development
Consultant with over 30 years of experience working in Africa, United Kingdom
and the United States. Below are the key positions he has held;
• Member of Parliament – Mporokoso Constituency (1973-74)
• Chairman - Public Accounts Committee in Parliament
• President – Africa Development Bank (1980-85)
• Legal Advisor – Zambian Mission to the United Nations
• Counselor – Zambian Embassy in Washington DC (1968-70)
• Partner – Jacques and Partners law firm (1971-74)
• Executive Director – International Monetary Fund (IMF) (1976-78)
• Senior Executive Officer – Standard Chartered Bank London (1979-80)
• Legal and Financial Advisor – Zambia Privatisation Team -retained
by the World Bank (1995-98)
• Member - University of Zambia Council (1988-91)
• Chairman - New Capital Bank Plc (2003 to date)
• Chairman – Constitution Review Commission (2003-06)
Mung’omba holds a BA (Economics) degree from Makerere University in Ugan-
da. He is a lawyer and graduate of the Honourable Society of the Inner Temple
in London, holds a Postgraduate Certificate in International and Comparative
Law from the International and Cooperative Law Centre in Dallas Texas, United
States.
He is a widower with two daughters.
7
Business News
Banks- Washing dirty linen
THE English cliché of ‘washing dirty linen in public’ could best describe the performance
of Barclays Bank Zambia new boss Zafar Masud and his Standard Chartered Bank
counterpart Mizinga Shansonga Melu at the recent Euromoney conference. At the cen-
tre of the rampus were the current commercial bank lending rates, which have remained
high despite the reduction in Inflation and Treasury bills rates. Masud is with the people,
and agreed that the current interest rates in Zambia were unjustified. But Melu could
not take that. Central Bank Governor Caleb Mailoni Fundanga opened the debate, ear-
lier, by questioning the current lending rates. In his keynote address to the conference,
Fundanga observed that the bank interest rates had not scaled down as fast as the
reduction in inflation. On average, the lending rates fell from 54.6 percent in December
2001 to 24.4 percent in December 2007, which is slower than expected. Masud, who
is also President of the Banker’s Association of Zambia (BAZ), said lower lending rates
were indeed expected with the current low inflation. With inflation projected at 7.0 per-
cent by December this year, the interest rates should naturally fall, analysts say. But
Melu thinks customers have over amplified the issue of lending rates, and argued that
in most cases the rates were not as high as they were portrayed to be. Her comments
drew a sharp reaction of disapproval from the packed hall at The Pamodzi Hotel. And
Masud openly disagreed with her, attracting a round of applause, for coming out more
sympathetically to the business community. A study has now been commissioned by
BAZ to thoroughly investigate the reasons behind the persistent high interest rates. We
hear Bank of Zambia officials are also part of the team. The idea is to reduce the cost of
doing business in Zambia, which is said to be higher at present than in other emerging
markets.
More banks enter the market
With more players entering the Zambian banking sector, competition is expected to help
push down lending rates. The bigger players, Barclays Bank and Standard Chartered
Bank, who have been dominant in the market, will face stiff competition from new en-
trants. Zambia has 13 operating commercial banks. The 14th one, Access Bank of
Analysis- Beware of the strong Kwacha
THE Zambian Kwacha was a key beneficiary of the initial wave of new portfolio investor
interest in Sub-Saharan African markets last year. It now looks likely to strengthen again.
This time, economic fundamentals will play a greater role in the currency’s apprecia-
tion. 2005 was an important year for Zambia. The country received sizeable debt relief
under the World Bank’s Heavily Indebted Poor Countries (HIPC) programme and the
G8-sponsored Multilateral Debt Relief Initiative. Zambia’s external debt fell from over
USD 7bn to just USD 500mn by the end of the year. The good news coincided with a rally
in copper prices, and a revival of activity on the copperbelt. Inflation was still high, but
nominal T-bill yields were attractive. Investors bought into the Zambian story, seemingly
unaware of, or perhaps unconcerned that revenue earned from copper was negligible.
High yields, currency appreciation and the benefit of leverage delivered more than 50%
returns within a few short weeks. The ‘Zambian experience’ was pivotal, stimulating
more interest in African markets, and a new scramble for African assets. Risk appetite
may have changed since the heady liquidity-fuelled days of late 2005, but the ZMK now
looks set to appreciate again, this time for reasons related to the imposition of a windfall
tax on copper earnings. The amount of tax revenue earned from copper, and the incen-
tives granted to investors in Zambia’s copper sector have long been a source
of controversy.
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Volume 1 - July 2008
Nigeria, is scheduled to begin operating soon. We hear also that FNB of South Africa
has shown strong interest in launching a branch in Zambia. Analysts say more big
players are needed to enter the Zambian market which is small but with potential to
grow especially with the growth in the mining sector. Citibank Zambia managing direc-
tor Saviour Chibiya says more players are needed on the market because no single
bank in Zambia can provide a credit line of over US$100 million without syndication.
Justice Chinyanta, Zambia’s foremost banker and chief executive officer of the South
African-based LOITA Group of Companies agrees that competition is likely to change
the market. He observed that only 20 percent of the Zambian population is bankable
and so the market is larger and new players to tap in.
For instance, the Small and Medium Enterprises (SMEs) should be the market to
target, Chinyanta argued. He blamed the bigger banks for lacking innovation and only
offering Zambians copycat products and services. Standard Chartered bank has al-
ready planned a major product targeting the SMEs, which is to be launched soon.
It is also building on its mortgage scheme, which has attracted a large number of
Zambians from the formal sector.
Loans for the ‘unbankable’
One area that has steadily developed in recent years is the micro-financing sector.
A number of institutions have been established to provide credit lines to less well to
do Zambians who, until recently, were considered ‘unbankable.’ Teachers, soldiers
and civil servants now queue up at a number of micro-financing institutions in order
to acquire salary-backed loans. But government wants to tighten the noose on these
institutions, arguing that a stronger regulatory regime is needed to deal with the mush-
rooming of micro-finance lending institutions. For instance, the BOZ survey on micro-
finance institutions conducted in 1999 showed that most of them were operating with
inadequate capital while their corporate structures were too weak. There were about
98 microfinance institutions operating in Zambia in an unregulated environment and
To pg 9
According to one civil society report (‘For whom the windfall?’), the Zambian state re-
ceived USD 71mn in tax from mining companies over the 2002-06 period, against re-
ported mining sector profits of USD 652mn. Further copper price strength more recently
is likely to be even more favourable for the profitability of the sector, although a substan-
tial sector-wide investment program is underway. With companies able to carry forward
costs associated with this investment, tax revenue was - until now - slow to rise, despite
the copper boom. A World Bank study conducted in 2005 suggested that the impact of
the development agreements (put in place to secure investment from new operators at
a time of weak international prices) was to create an effective marginal tax rate of 0%
for the mining sector against much higher marginal tax rates for other sectors of the
economy. Mining has however always been of strategic importance, as a formal sector
employer and as a contributor to export earnings. Despite extensive foreign ownership
in the copper sector post-privatisation, fortunes on the copperbelt have always been
synonymous with Zambia’s own economic performance. Between 2005 and 2006, the
value of Zambia’s copper exports more than doubled, reaching USD 2.78bn, and has
risen further since. Pressure from the political opposition, as well as encouragement
from donors, helped to bring about a change in the tax regime, announced in this year’s
budget.
To pg 9
Volume 1 - July 2008
Now the mining sector faces a higher royalty rate (from 0.6% to 3%), higher corporate
taxes (from 25% to 30%, although losses may still be carried forward according to a pre-
determined 75:50:25 formula), and – most significantly - will see a windfall tax imposed
on copper earnings of up to 75%. Moreover, it is
probable that these payments will be made in ZMK, significantly increasing the demand
for ZMK relative to the FX inflows to which the market is accustomed. There is some
possibility that payments might be made in USD to the Zambia Revenue Authority, which
will then convert the proceeds at an average interbank USD-ZMK rate in an off-market
transaction with the Bank of Zambia, thus preventing the inflows from impacting the
market severely. A sizeable currency appreciation appears imminent.
Gauging the impact of the sudden ‘windfall’
What will the impact of all of this be? Official attitudes to currency appreciation are still
ambiguous. While Zambia, as a net oil importer, will benefit in the near term from a
stronger currency, other factors are likely to
dominate government thinking. Although Zambia plans to reduce its traditional reliance
on donor financing, for the moment, the contribution of donors to Zambia’s budget is
large enough for the authorities to be wary of seeing dramatic and sustained currency
strength. (The proceeds of the windfall tax have not been included in the 2008 budget).
With domestic revenue collection set to surge, Zambia will be able to make rapid prog-
ress in reducing its traditional donor reliance, should it wish to do so. But questions
about revenue sustainability and the optimal means of development financing must still
be considered).
In recent years, Zambia has also tried to boost its ‘non-traditional’ sectors, especially
agriculture and tourism. While we believe that demand for high-end tourism may be rela-
tively inelastic with respect to the exchange rate, and that a stronger ZMK may actually
help with the cost of imported inputs for agriculture, such as fertiliser, (to say nothing of
the cost of much-needed infrastructure development), the authorities - under the influ-
ence of various lobby groups - may not be receptive to this view. There is therefore a risk
that sharp ZMK appreciation might be met with an official effort to reverse or slow the
currency’s gains. We have incorporated this into our currency forecasts, with a mid-09
USD-ZMK rate of 3500, compared with a rate of 3120 by the end of this year. But it is
not just the currency impact of kwacha strength on the economy that should be con-
sidered. The impact on future mining sector developments is equally important. Mining
companies have too much invested in Zambia to walk away now. The authorities appear
confident that the structure of the windfall tax will not act as a constraint on Zambian cop-
per output. Although a maximum windfall tax of 75% applies, the government estimates
that this (together with mining
sector royalties and the higher rate of corporate tax) will increase the total mining tax
rate from 31% to 49%. Clearly, opinions differ, but for now it is assumed that the extent of
investment spending already undertaken by existing mine operators will mean that they
are unlikely to exit Zambia as a result of the imposition of the windfall tax. (One of the
largest operators has already invested around USD 900mn in growth projects and the
rehabilitation of the mines since 2004, and still awaits significantly higher production).
Simultaneous investment in refining capacity means that Zambia will have to remain on
track to achieve its aspirational production target of 1mn tonnes of finished copper, for
it all to pay off (although copper from the Democratic Republic of Congo may also be
refined in Zambia). There is some truth to this argument. The importance of economies
of scale has driven the revival of the copperbelt in recent years. Significant investment
has already been undertaken, and only more production will now help to drive costs
down. This is especially true in some of the ‘wetter’ copper mines, where water pumping
can account for as much as 30% of the total running cost of the mine. If the pumps stop
operating, the mines would flood within hours. For at least one of Zambia’s largest mines,
a tripling of mine production is planned, and much of the investment spend has already
been committed. The huge increase in production will however require only a small in-
crease in the pumping requirement. Economies of scale will help lower production costs
and also help the mine to absorb more overhead costs. Having doubled output, Zambia’s
Copperbelt looks to do it again soon. Having invested considerably in Zambia, it may not
make too much sense for mining companies to withdraw at this stage.
However, there are still important factors that should be noted. The investment cycle
in mining is notoriously pro-cyclical, but the imposition of the windfall tax on mines will
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reduce the ‘upturns’ in the cycle. Given the structure of the windfall tax, for some of
Zambia’s mine operators, further upside when LME copper prices rise will be negligible.
This will impact investment on the copperbelt in the long term. For new operators even in
the midst of a copper boom, it may well be a choice between additional investment spend
in Zambia, or elsewhere, and the upside elsewhere may be higher.
Another potential problem with the windfall tax is that it is based solely on the sales
price for copper - it does not take into account the fact that different producers face dif-
ferent costs of production, depending on how the copper is extracted. In some cases,
ore grades in open pit mines have declined and production has been depleted, creating
a need for mining at greater depths. Costs in the Zambian mining sector are in general
already higher because of the existence of underground operations (in particular the
Konkola Deep Project which was necessary to prolong the life of one of Zambia’s largest
mines beyond 2011). This means that development overheads are also higher. But even
within Zambia, there is wide variation in the depth of the mines. The difficulty with the
windfall tax is that it discriminates against the higher cost producers, and may discour-
age the development of more marginal producers. In the context of a copper-related
boom, this is unlikely to matter. Should copper prices correct down in the future, in line
with weaker international growth, it might exacerbate Zambia’s vulnerability to global
cycles. Clearly, there are various issues that may need to be revisited.
But in the near term, it looks likely that Zambia will go ahead with its plans for the windfall
tax. Although royalties are paid monthly, the windfall tax is due at the end of each quarter
(based on daily LME prices - averaged out for a month). The ZMK has already been ap-
preciating, helped by flows related to a recent telecoms sector IPO. But the continuation
of significant FX inflows looks likely to drive USD-ZMK to even lower levels. The new tax
regime became effective from the start of this fiscal year -April 1st. With a 3 month grace
period on the windfall tax, ZMK appreciation pressures are likely to be most pronounced
between June and September (unless of course the government puts in place corrective
measures). Given the history of ZMK appreciation in leading portfolio investor interest in
African markets, global slowdown or not, we could be in for another wave of FX euphoria.
In the short term, at least. [Courtesy of Razia Khan of Standard Chartered Bank.
Banks- Washing dirty linen
this led to the BOZ introducing the ‘Microfinance Regulations’ of 2006, on the basis of
the Banking and Financial Services Act. These regulations managed to bring down the
number of microfinance institutions to thirteen, Fundanga revealed, though he hinted
that the number may rise again going by the number applications under consideration.
The high interest rates charged on the poor is also alarming government. Finance and
National Planning minister Ngandu Peter Magande wants stronger protection against
what he calls ‘exploitative interest rates’ by micro finance institutions. But the micro-
finance institutions argue that tightening their operations is not the answer but rather
closer monitoring to remove the ‘logs’ in the sector. For instance, Microfin Africa Zambia
Limited Managing Director, Ruskin Jere, says micro-financing has managed to capture
the majority of Zambians who were considered ‘unbankable’ by the bigger banks. “No
bank looked at these people as customers…we managed to bring them on board as
microfinance institutions,” said Jere.
However, the risk factor of such lending is also high because most of the creditors have
no fixed abode and can even forge documentation. And this explains the high interest
rates these institutions charge, another analyst explained. However, business is flour-
ishing in this sector. Bigger players such as Barclays Bank have joined the bandwagon
and recently opened the micro-finance wing. But should the big guys be allowed to
join the lower league? This is a question which micro finance institutions have been
asking Central Bank. And many agree that big banks should be barred from getting into
microfinance business.
9
Business News
LUMWANA - Its hooray!
FROM massive copper deposits, to the discovery of Uranium, and acquiring an
additional 35,000 hectares of land, Lumwana Copper Mine (LCM) is Zambia’s
success story. The mine, with a capital base of US$ 882.7 million is on course
to be commissioned in July. Over 75 percent of the work has been completed
with a current workforce of 4,700. The copper project will mine and process 20
million tonnes per year of copper ore, which will produce copper concentrates
of an average 156,000 tonnes annually. A deal has been cut with the Chi-
nese-owned Chambishi Copper Smelter (CCS), currently under construction
in Chambishi, to process the ore produced by LCM.
Graig Williams, LCM chief executive officer, must have reasons to smile espe-
cially after successful electrification of the 33KV Lumwana substation by Zam-
bia Electricity Supply Company (Zesco). The substation connects the mine
to the national electricity grid. The water extraction system has also proved
reliable after testing, pumping 500m3 per hour, in readiness for the commis-
sioning of Africa’s largest known mine with huge untapped copper deposits.
Intense negotiations with traditional leaders, local authorities and the Ministry
of Lands almost threw the project into disarray when objections were raised
over the acquisition of 35,000 hectares of land for a new mine township. But
in May, the authorities gave in and allowed the mine to take possession of the
massive land, located in the North-western province of Zambia. It is hoped that
the traditional rulers in the area will benefit from the grant of their customary
land to the foreign investor, Equinox Minerals Limited of Australia.
Good news for LCM is the final confirmation that the Uranium, situated within
the mining area, is economically viable and will be mined and stockpiled during
the same period as of copper. The feasibility study carried out from April 2007
to May 2008 confirmed the availability of huge Uranium deposits within the
Mulundwe and Chimiwungo zones of Lumwana. The news coincided with the
International Atomic Energy Agency (IAEA) approval of Zambia’s regulations
to guide the country in Uranium mining. Mines and Mineral Development min-
ister Kalombo Mwansa announced that the regulations will encompass guide-
lines on mining, milling and transportation of Uranium and other radioactive
products in the country. The Bill, regulating Uranium, is due to be presented
to parliament in July.
For now, LCM has lodged documents with the Environmental Council of Zam-
bia (ECZ), asking for authorization to proceed with Uranium mining, as per
Zambian law. The Environmental Impact Assessment (EIA) provides details
on how the company intends to mitigate the environmental concerns which the
project will raise. All things been equal, the LCM Uranium project is expected
to begin construction activities during the third quarter of 2008. The project is
tentatively set to open by 2010, the company said in a statement.
10
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Volume 1 - July 2008
LOITA – Smiling to the bank
AFTER selling 40 percent shares in Finance Bank Zambia Limited, LOITA
Holdings Corporation Chairman, Justine Chinyanta, is smiling all the way to
the bank – and he now plans to take a year sabbatical to study at Harvard
University. One of Zambia’s foremost bankers, Chinyanta proudly admits that
the deal was so good to refuse. “The price was also good,” he told Executive
Issues, but held back the figures due to confidentiality agreements. He said
the investment in Finance Bank had matured and he managed to source a
“higher quality investor” in the name of Credit Suisse. However, LOITA will,
in the meantime, manage the affairs of Finance Bank for “a period of time” to
allow a smooth handover. LOITA had a management contract with the bank,
which will expire with their exit.
Up for sale next is the Industrial Credit Company (ICC), owned by LOITA. We
gather negotiations with a local consortium have reached an advanced stage,
but Chinyanta could not disclose when pressed, citing regulatory constraints
and confidentiality surrounding such deals. “I promise to give more after Au-
gust 1,” he said. But why is he disinvesting in Zambia? “We want to do what
we know best…” – was his answer, as he disclosed his stake in ZAMLINK, a
firm that has been approved by the Bank of Zambia to be the fulcrum for the
national financial switch. The project will enable electronic funds transfers to be
more efficient in Zambia. ZAMLINK, which LOITA owns 50 percent, will also
help improve the efficiency of Automated Teller Machines (ATMs), which have
become widespread in Zambia.
For now, LOITA will concentrate on structured finance or merchant-banking type
of transactions, which it has specialized in for years. Chinyanta has now set his
eyes on the US$ 100 million Export Fund for Zambia, which was launched
recently. LOITA was appointed manager for the fund. Chinyanta predicts that
his firm will “most likely take an equity interest.”
To pg 11
Oil – ZANACO scoops tender
THE partially state-owned Zambia National Commercial Bank (ZANACO)
has been awarded the tender to finance the US$ 1.2 billion oil procurement
deal after it emerged winner in the three-horse race. The bank scooped the
tender after a competitive bid, so we are told, beating Citibank and a joint
undertaking by Finance Bank Zambia and the PTA bank. Energy Perma-
nent Secretary Peter Mumba said negotiations with ZANACO were expected
to conclude soon. The government selected International Petroleum Group
(IPG) of Kuwait to supply the crude on a longer term basis to avert possible
fuel shortages that had hit the nation last year. Initially, Zambia picked Stan-
bic Bank Zambia Limited, a subsidiary of Standard Bank of South Africa, to
finance the 1.5 million tonnes crude oil procurement but the deal went sour
after the two parties disagreed on the technicalities. We hear South Africa’s
Ned bank was also interested in the transaction even thought it never ten-
dered. In the meantime, PTA bank will finance the procurement of crude while
talks between ZANACO and government go on. So far, some 90,000 tonnes
of crude, financed to the tune of US$75 million dollars by PTA bank, arrived
in the country and the second consignment due in July.
Volume 1 - July 2008 Business News

LOITA – Inflation – Missing the target

ONE question that unsettles the maverick Finance Minister Strong Kwacha is back

Smiling to Ngandu Peter Magande is the imminent possibility of missing

the projected year-end inflation target of 7.0 percent. Asked
whether he was on track with his inflation target especially that
Away from inflation, Zambians are also grappling with the
re-emergence of the “strong Kwacha,” which has been trig-

the bank
the figure is showing an upward trend in midyear, Magande’s gered, we are told, by good economic performance mainly
tone changed: “Why do you want to know? Do you use inflation in the mining sector. For instance, copper output shot-up
in your planning at home?” the minister queried the reporter at by 101.6 percent between 2000 and 2007, bringing in more
a recent news conference. foreign exchange on the market. This was further beefed up
by the upsurge in copper prices on the international market.
He is a Zambian resident The earnings from the Non-Traditional Exports (NTEs) tripled,
He has every reason to be riled because recent developments
in South Africa who will BOZ claims [see graph], though analysts argue that this sec-
show that he may miss his much acclaimed target. Reasons?
tor has been badly affected by the strong Kwacha. “Only few
be taking a sabbatical in The ongoing electricity outages, the rising in global oil prices NTEs performed well, the majority did badly,” said Trevor
August this year as a fel- and the food shortages facing the world. These factors are put- Simumba, an economist who has been following the trends.
low of the Weatherhead ting a strain on government’s intention to tightly hold inflation at He argued that cotton and tobacco industries are performing
Center for International single-digit level. Dr. Denny Kalyalya, Deputy Governor of the badly due to the strong currency leading to job loses in rural
Affairs at Harvard Uni- Bank of Zambia (BOZ) in-charge of operations, admitted the areas where the sectors employ a lot of labour and Indeed,
versity, though he will problem, but was quick to point out that the 7.0 percent is still the figures from BOZ show a decline in some of the NTEs in
realistic, “at least for now.’’ recent years.
continue as non-execu-
tive chairman of LOITA. “I “There are challenges in reaching that (inflation) target but we
can’t give up yet,” Kalyalya told members of the Economic As- The country is also enjoying huge savings from lower for-
will be there for one year eign debt servicing after the country qualified for the Highly
sociation of Zambia (EAZ). Many economic pundits agree that
and intend to consolidate Indebted Poor Countries (HIPC) initiative after which the debt
it may be difficult to achieve the 7.0 percent target if the current
the Group’s potential stock decreased to US$2.1 billion as at December 2007 from
trends of power outages and rising global oil prices continue.
base in the US market,” US$7.3 billion in 2001. Foreign Direct Investment (FDI) has
“After all, high inflation is not always a bad thing,” Barclays also picked up in the aftermath of the HIPC debt relief. And
Chinyanta said. A lawyer Bank Managing Director Zafar Masud, chipped in, defending so? It’s a strong Kwacha! But is it good or bad? - That is a
by profession, Chinyanta Magande at the Euromoney Conference. question that still begs an answer.
has over 25 years of ex-
perience in investment
banking, having worked
as Vice-President of Ci-
tibank Africa region as
well as HSBC Africa be-
fore venturing into LOITA.
He is an executive Vice-
President of the Southern
Africa Chapter of the Af-
rica Business Roundtable
(ABR).

LOITA Holdings Corpora-

tion, founded by Chinyan-
ta who is Group chair-
man and chief executive
officer, is the holding
company for LOITA Capi-
tal Partners International
– an investment banking
firm – and Fintech, an IT
company. The Group also
has interests in LOITA
Transaction Services,
which has a stake in Afri-
can Financial Switches.
Source: Bank of Zambia

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Telecoms: Zamtel – Big boss wanted
THE cash-strapped Zambia Telecommunications Company Limited (ZAMTEL)
is looking for a new boss to stir the company to profitability. The board wants
a Managing Director who has a master’s degree in Business Administration,
a degree in Economics, Business Administration, Engineering or Information
Technology. The candidate must have at least 10 years experience working at
senior management level in a large commercial organization.
Zamtel has financial woes that have led to management suspending its spon-
sorship of the company’s football team. It also plans to downsize staff in a
major restructuring exercise. The new boss will have an uphill battle turning
the company around while at the same time managing the political interfer-
ence that comes with such jobs.
Vodacom - Kavindele fights on
Enock Percy Kavindele or ‘EPK’ rarely gives up on business fights. He has
won round one against the Communications Authority of Zambia (CAZ) over
the fourth mobile phone licence which was issued to his Vodacom consortium
in 2001 but was later withdrawn. The reasons given for the withdrawal was that
the main consortium member, Vodacom International Holdings had pulled out
of the Zambian venture and that decision altered the suitability of the consor-
tium to proceed with the venture. Kavindele insisted that he would proceed
with the venture through his company, Unitel Communications Limited, by
bringing in other investors. Lusaka High Court Judge Philip Musonda has, in
the meantime, halted the CAZ from going ahead to award a licence to a differ-
ent group and ruled that Kavindele is still the lawful owner of the licence. But
CAZ said it is appealing to the Supreme Court against the high court order. We
hear the Attorney-General may join the legal battle against Kavindele.
The CAZ advertised for investors to tender for the fourth mobile telephone
licence. The tender also raised a lot of questions among investors, includ-
ing questions over the requirement to pay a non-refundable fee of close to
US$100,000. And yet the tender was only to run for four weeks. Conspicu-
ously, the tender did not talk of bringing Zambians on board as an advantage
in line with the Citizens Economic Empowerment Commission (CEEC). Ru-
mours flared that some Indian group, with strong political connections, had
been assured of wining the tender. For now, everyone will wait for the long
battle of EPK who, surely, will not give up without a big fight. But as the fight
goes on, there is a list of investment lobbyist circling government departments
with proposals for the fourth mobile telephone company.
Celtel – Please try your call later!
When the shares of Celtel Zambia Limited began trading on the Lusaka Stock
Exchange (LuSE) on June 11, 2008, company Director of Finance, Randell
Hato, was answering tough questions from customers at a sideline meeting
during the Euromoney conference. Subscribers wanted to know why the com-
pany is expanding so fast but yet the network is performing poorly and annoy-
ingly so.
Hato, in a calm and cautious tone, assured customers - some threatened to
abandon the network – that the problems affecting the quality of Cel-
tel had been caused by the delay in moving their call-centre operation
from Central Park to the new building in Lusaka showgrounds. He
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Volume 1 - July 2008
pleaded with the subscribers to stay the course, promising better things to
come, though few believed him.
But at LuSE offices, Celtel Managing Director, David Venn, was in a cham-
pagne popping mood. There, it was fanfare, bells ringing to signify the opening
of the trading of Celtel shares, which went on public offer between April 30 and
May 20th 2008. It was Zambia’s largest Initial Public Offer (IPO), so we are
told, with over 150 percent oversubscription. Applications from international
institutional investors were cut back to 20 percent from their origin bid of 51.5
percent. And so did the Zambian institutional investors get affected, by a 12
percent cut, in order to allow ordinary Zambians acquire shares. Celtel Africa
Group chief executive officer Chris Gabriel was also in attendance, witnessing
the first trading of the 20 percent shares at LuSE alongside finance minister
Ngandu Peter Magande and transport and communications minister Dora
Siliya.
“It is one of the biggest IPO in Zambia,” declared LuSE acting Chairman Lewis
Mosho, adding that refunds will be made soon. But, he promised, not to Zam-
bian investors.
Celtel Zambia is the largest mobile phone operator in Zambia with more than
2.1 subscribers (as at March 2008) and its network has expanded to most
parts of the country. It claims to have a market share of 78 percent in Zambia
and that it why the Zambia Competition Commission (ZCC) is now pushing for
a fourth player to immediately enter the market to undo the Celtel monopoly.
But in the meantime, Celtel will have to deal effectively with the congestions
and connections woes on its network if it has to satisfy the customers.
Here are the owners of Celtel Zambia Limited
• CIBV – 78.9%
• IFC - 1.1%
• Zambian Public – 3.4%
• Celtel Employees – 0.2%
• Local Institutional investors – 6.3%
• Foreign institutional investors – 10.1%
Fuel prices – Going up and up!
“Brace yourselves for high fuel costs,” was the timely warning from Presi-
dent Levy Patrick Mwanawasa. Indeed, Zambians have already started
feeling the pinch over the global rising in oil prices. Finance Minister
Ngande Peter Magande announced measures, insignificant though, of
trying to keep the fuel prices within reach of the majority. He reduced
excise duty on petroleum products with the rate of diesel coming down to
15 percent from 45 percent while petrol was reduced to 45 percent from
60 percent. Kerosene has been zero rated. The measures will result in
government losing revenue to the tune of K127 billion, Magande said.
However, the reduction in excise duty will not in anyway push down the
pump prices of fuel. Economic experts have questioned the rationale of
government maintaining the excise duty on fuel when it is scrapping the
fuel subsidies. Since October 2007, government has been toping up on
pump prices in order to mitigate high fuel prices. So far, ZMK 96 billion
has been spent on the fuel subsidies, which government says must be
stopped. Indeed, Zambians must begin preparing for high fuel costs in the
coming months if the rising oil prices on the international market continue
with an upward swing.
Volume 1 - July 2008
Diplomacy – Levy, Mugabe fights on
ZAMBIAN President Levy Patrick Mwanawasa’s credentials as a regional leader
have been bolstered, following his strong stance as SADC chairman on neigh-
bouring Zimbabwe. Western countries have used superlatives to describe his
leadership of the regional body. But the majority of his peers in SADC view him
as something of a sell-out who is conniving with the West to press for “regime
change” in Zimbabwe. By and large, the allegations against Mwanawasa are
unfounded but they persist. Out of the 14-member countries of SADC, only Bo-
tswana’s new President Ian Khama and to some extent Tanzania’s Jakaya Mrisho
Kikwete, seem to be in concert with Mwanawasa over Zimbabwe. President Rob-
ert Gabriel Mugabe and his government consistently portray
Mwanawasa as a Western puppet especially after he quite undiplomatically char-
acterized the political and economic meltdown in Zimbabwe as a case of the
‘Sinking Titanic’. The remark did not go down well in Harare, which immediately
dispatched the veteran political bruiser, Didysmus Mutasa (Minister of State for
National Security) to Lusaka to lodge a complaint. Thereafter, a long political and
diplomatic fight between the two governments ensued.
A last minute cancellation of a planned official visit to Zimbabwe by Zambia’s Se-
curity and Intelligence Service Director-General Regis Phiri signaled the continu-
ation of problems between the two countries. We hear Phiri had been
invited by Zimbabwe to workout an amicable détente. Mwanawasa responded by
dispatching Vice President Rupiah Bwezani Banda as a Special Envoy to assure
Mugabe that he was not trying to destabilize his presidency as alleged by his of-
ficials. Banda managed to calm the situation down but Zimbabwean government
suspicions of Mwanawasa’s hand in their problems continued. They were re-kin-
dled anew when Mwanawasa invited Zimbabwe’s main opposition leader Morgan
Tsvangirai to the April extra-ordinary summit in Lusaka to discuss the Zimbabwe
elections. The summit was heated and Mwanawasa seemed isolated with the
other leaders taking the view that the invitation of Tsvangirai was irregular. The
Zambian leader defended his position, insisting that the invitation was made after
consulting South African President Thabo Mbeki and Khama. Thereafter it was
open season. Zimbabwe’s state-run Herald newspaper published a chain of edi-
torials and feature articles critical of Mwanawasa.
The Zambian government was forced to lodge a formal diplomatic complaint by
way of a note verbale , a form of diplomatic communication, as relations between
the two neighboring countries worsened, as accusations by Zimbabwe that Zam-
bia received US$71 million in ‘aid’ from the United States for ‘regime change”
in that country flew. Zambia denied the accusations. Foreign minister Kabinga
Pande announced on June 5 that the Zambian government was shocked by the
persistent attacks on Mwanawasa who was genuinely trying to help resolve the
crisis on Zimbabwe.
Zimbabwe’s outspoken Justice and Constitutional Affairs Minister Patrick China-
masa insists that Mwanawasa has failed to implement a Southern Africa SADC
resolution that mandated him to engage Western countries in order for them
to end their sanctions on Harare. Mwanawasa is SADC chairman until August
when Mbeki takes over. Zambia and Zimbabwe have almost suspended routine
diplomatic briefings, through their legations. But Mwanawasa is insistent that he
will not keep quiet when the political and economic meltdown in Zimbabwe is
affecting Zambia. Zambian authorities have now tightened border controls with
Zimbabwe in an attempt to block hundreds of Zimbabweans from crossing into
Executive Issues
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Diplomats
Zambia. Mwanawasa has already said he is not ready to accept an estimated 25,
000 Zimbabweans fleeing xenophobic attacks in South Africa who had indicated
willingness to re-locate Zambia. Only genuine asylum seekers, whose lives were
in danger, would be granted entry. On June 10, Zambia granted political asylum to
12 supporters of Zimbabwe’s main opposition Movement for Democratic Change
(MDC) who fled the escalating violence ahead of the presidential run-off election.
The United Nations High Commissioner for Refugees (UNHCR) in Lusaka is cur-
rently screening more MDC supporters before recommending them to Zambia for
asylum. The Maheba Refugee Camp in North-Western Province, which sheltered
Angolans during the civil war, will be the new home for the Zimbabweans. But
Zambia has asked UNHCR to provide funds for the refugees because the country
has no budget line.
Divisions within SADC over Zimbabwe have increased with the majority of the
member countries accusing Mwanawasa of failing to follow procedure in handling
the crisis. The Zambian leader confirmed at a news conference that President
Mbeki has not been consulting with him as chairman and he had the cheeky of
ignoring his telephones calls – a worrying development for SADC. While attending
the Tokyo International Conference on African Development (TICAD) in Japan,
Mwanawasa called for a sideline meeting with SADC leaders to discuss Zim-
babwe. Mwanawasa wanted a quick resolution of the deployment of the SADC
Observer Mission to Zimbabwe for the presidential run-off election. In attendance
were South African President Mbeki, Nambia’s Pohamba, Malawi’s Bingu wa
Mutharika, Tanzania’s Kikwete, Swaziland King Mswati and the Prime Minister of
Lesotho Pakalitha Mosisili. The rest of the countries were represented by their for-
eign ministers. Zimbabwean foreign minister Simbarashe Mumbengegwi raised
a point of order, asking whether Mwanawasa was right to raise the issue of the
SADC Observer Mission without consulting Mbeki, who is the SADC mediator
on Zimbabwe. Mbeki supported Zimbabwe on the point and the other countries
joined in support. They wondered why Mwanawasa called the meeting when
Angolan President Eduardo dos Santo who chairs the SADC Organ on Politics,
Defence and Security was supposed to do that.
Mwanawasa was unanimously ruled out of order and we hear he threatened to
resign from his position though his Foreign Minister Pande denied the report. On
June 5, Zambian Information minister Mike Mulongoti, castigated SADC leaders
for failing to send the mission to Harare when it was agreed to do so at an extraor-
dinary heads of state summit held in Lusaka on April 13.
“President Mwanawasa found it difficult to reconcile his conscience when some
heads of state and government spoke at length, deliberating on the procedural
debate and consequently ended the meeting inconclusively,” Mulongoti said.
The trouble with Mwanawasa and indeed other leaders in the region is that they
do not trust Tsvangirai whom they consider to lack presidential qualities. In fact,
Mwanawasa’s government once deported Tsvangirai from Livingstone where he
had sneaked in with his Movement for Democratic Change (MDC) leadership to
hold their strategic meeting. The MDC promised to take on Mwanawasa but aban-
doned that mission on the way. Mwanawasa is now hitting hard on Zimbabwe
as he prepares to handover the chair to Mbeki in August. “Last kicks of a dying
horse…,” a Zimbabwean official remarked, counting days of Mwana-
wasa’s time at the helm of SADC. No doubt, he will be remembered for
taking such an unprecedented position as chairman. To pg 14
Diplomats
Diplomacy:
Bon Voyage to Obote
team
The Zambian government has finally managed to secure a deal on behalf
of the over 200 supporters of the late former Ugandan President Milton
Apollo Obote for them to return home after years in exile. Obote who had
been a guest of the Zambian government died in October 2005 in a South
African hospital where he was evacuated after an illness. The Ugandan team
has been living in Zambia since 1985 after they fled their country following
the overthrow of Obote’s government by President Yoweri Kaguta Museveni.
Home Affairs Permanent Secretary Susan Sikaneta bid farewell to the first
batch of the returnees on May 21, 2008 at Lusaka International Airport where
they boarded a Kenyan Airways flight to Kampala. Most of the Ugandans,
who were given political asylum by then President, Kenneth David Kaunda,
have been living in fear of returning home after they were accused of com-
mitting atrocities during the Obote rule. Now Museveni has agreed to allow
them back without facing repercussions even though others are still scared
and do not trust Museveni.
The United Nations High Commissioner for Refugees (UNHCR) has provided
US$ 210,000 for the voluntary repatriation of the Ugandans. For the purpose
of their return, the returnees have been given Voluntary Repatriation Forms
(VRFs) issued by the UNHCR since most of them have no valid passports.
Besides providing transportation to the Ugandans, UNHCR will also assist
them with small grants to help them during the journey as well as use part of
the funds for re-integration in Uganda.
UNHCR said the political, economic and social conditions in Uganda are now
ripe for such an organized repatriation.
Diplomacy – Levy, Mugabe fights on
Meanwhile, Zambia’s first President Kenneth Kaunda is pushing for a new initia-
tive on Zimbabwe, asking SADC to push for a Mugabe-led unity government. He
argues that whatever the outcome of the June presidential run-off, the problems
of Zimbabwe will not be solved more so that the security and defence forces have
joined in the political bandwagon. He suggested that opposition leader Tsvangirai
should accept the position of Prime Minister to be created with equal powers with
the President. Losing independent candidate in the first round, Simba Makoni, is
said to be pushing for a unity government as well.
Side Bar
The last minute pull-out from the run-off by opposition leader Morgan
Tsvangirai was ill-timed strategy. This will definitely works in the game-
Executive Issues
Executive Issues
Volume 1 - July 2008
Russian money to flow into Zambia?
Russia’s outgoing Ambassador to Zambia Dr. Anvar Azimov raised dust
on the international scene after he disclosed that three Russian compa-
nies are planning to invest a staggering US$2 billion dollars in Zambia.
Initially, Azimov said the three Russian companies will pump in US$ 3 bil-
lion dollars in Zambia’s mining sector. But international investment advi-
sors doubts the figures especially that Russian investors rarely cuts such
kind of deals in Africa. The Mineweb quoted a South African mining ad-
visor as saying “it sounds like unlikely story to me. Russians never ac-
tually invest their money into Africa, and especially into Zambia.” When
pressed for details, the Russian Embassy in Lusaka opted to remain mute.
The three Russian companies are said to be exploring the possibilities
of launching Greenfield mining investments, including setting up a multi-
million smelter, a power station, railway line and a mining town with hun-
dreds of houses for mineworkers. The representatives of these companies
are due to arrive in Zambia this month to conclude on the negotiations.
RusInvest partner (Renova Groupe), ECN Groupe and Aurora Capital are the
three companies said to be interested in Zambia and their key officials have
already opened talks with government. Joint ventures with Zambians are the
possibility but the Russian should take not less than 70 percent sharehold-
ing, Azimov was quoted as saying. “They are interested in huge projects, not
small ones,” Azimov said. We understand they have already put in a propos-
al to develop a smelter at Lumwana Copper Mines (LCM) in northwestern
Province at a cost of US$ 400 million dollars. LCM, due to be commissioned
this month, has no smelter and it plans to process its copper ore at the Chi-
nese-owned Chambishi Copper Smelter (CCS) currently under construction.
However, we understand the Russian investors have faced difficulties in
finding mine areas where to exploit because most mineral areas with huge
untapped deposits have already been granted to investors. The Ministry of
Mines and Mineral development is working out a process of repossessing
the exploration licences issued to investors who have never used them.
Luapula province may also be the only available land for the Russians, who
have also pledged to support sport. Another option which the Russians are
considering is outright purchase of the exiting mines from the current own-
ers. “This story is too good to believe,” said one mining investor in Zambia.
But he was quick to point out that it will make a lot of sense if the Russians
were eyeing Uranium, which has been discovered in most parts of Zambia.
About 30 other Russian investors have visited Zambia in recent months to explore
the business opportunities in Zambia. Meanwhile, the Russian government
has disclosed that it intend to strengthen its military cooperation with Zambia.
plan of President Robert Gabriel Mugabe who will, undoubtedly, be declared
winner unopposed. This is what the ruling ZANU-PF wanted – to get victory at
all cost. The opposition Movement for Democratic Change (MDC leadership is
divided on the matter. One camp feels that boycott of the polls will definitely help
Mugabe consolidate his position and anoint a successor within his ranks and file.
This will surely change the political landscape of Zimbabwe. But the other groups
argues that violence participating in the sham elections will only give credence to
Mugabe to claim fake victory based on intimidation. And in any case, they argue,
the outcome of the presidential run-off was already predetermined following the
announcement by the defence and security chiefs that they will not accept an
opposition victory. Both sides have valid arguments. However, the boycott has
made Mugabe to consolidate his hold on Zimbabwe. We hear he is now pushing
a smooth succession plan involving his trusted minister and friend, Emmerson
Mnangangwa, to takeover the reign. However, within ZANU-PF, strong opposition
against Mnangangwa, is also strong – mainly spearheaded by the powerful retired
Army General Solomon Mujuru. Mujuru is pushing for the wife, Joyce Mujuru, to
takeover. She is current Mugabe’s number two but without any influence.
Volume 1 - July 2008
Financial Briefs – Key Appointments
Chikolwa – A moving boss
Joseph Chikolwa, Chief Executive Officer of Zambia Consolidated Copper
Mines- Investment Holding (ZCCM-IH) has been appointed new managing
director of Stanbic Bank Zambia Limited, taking over from Larry Kalala who
has become the bank’s chairman. Chikolwa has held key positions within
the financial sector, including that of general manager/ chief executive of-
ficer of the Lusaka Stock Exchange. He also held senior positions in Zambia
National Commercial Bank Plc, Standard Chartered Bank Zambia Plc and
Investrust Bank Plc.
Holder of a degree in Economics from the University of Zambia, a master’s
degree in Finance from University of Wales, a diploma in finance from the
Institute of Financial Services, Chikolwa is a fellow of the Zambia Institute
of Bankers.
Chipwende – Homecoming
Andrew Chipwende had been appointed chief executive officer of the re-
cently created Zambia Development Agency (ZDA). Chipwende held senior
positions with the disbanded Zambia Privatisation Agency (ZPA), which he
later headed before its dissolution. He specializes in policy formulation, pro-
gramme design and strategy development. After his stint at ZPA, Chipwende
was appointed advisor to the government of Sierra Leone in-charge of priva-
tization, which focused mainly on sector reforms and improving business
conditions ahead of the country’s privatization programme. We hear he faced
a big competition at ZDA during the interviews but he emerged the favourite
within government circles.
Chewe – Eating with Nigerians
David Chewe has been appointed first chief executive officer of Access Bank
Zambia Limited, which is a subsidiary of Access Bank of Nigeria. Chewe is
the current President of the Zambia Institute of Banking and Financial Ser-
vices. He is a renowned banker who has served at senior and executive lev-
els at Standard Chartered Bank Zambia Plc, Stanbic Bank Zambia Limited,
Barclays Bank Zambia and Zambia National Commercial Bank Plc.
Mung’omba – The perseverance
Mable Mung’omba has been appointed first director general of the Citizens
Economic Empowerment (CEE) Commission. Immediate past president of
the Zambia Institute of Marketing, Mung’omba has over 18 years of experi-
ence in the private sector where she held senior executive positions, includ-
ing that of general manager at former International Chemicals (Z) Limited.
Mung’omba holds an undergraduate degree in Business Administration from
the Copperbelt University and three postgraduate qualifications.
She has among other qualifications a Masters in Business Administration
with a major in Multinational Finance and International Business, diploma
from the Chartered Institute of Marketing, United Kingdom (CIM) and a Cross
Sector Partnership qualification from Cambridge University.
She also worked as chief executive for the Africa Health Services, an Anglo
American Corporation subsidiary, before joining the start-up team that led to
the vision and development of Celtel.
Executive Issues
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Profiles
ACC - Nix to Nixon Banda
Sometimes it does not pay to act professional, at least the Anti-
Corruption Commission (ACC) Director-General, Nixon Banda,
must have learnt by now. Banda has been a thorn in the fresh of
most senior government officials serving in the current govern-
ment. And it was not a surprise that his contract has not been
renewed. The reasons given for the non-renewal is that Banda
had reached the legal retirement age of 65, ACC said. Com-
missioner Akashambatwa Mbikusita-Lewanika tried to justify
the decision saying it what the ACC Act provided. But the list of
retired senior government officials serving in key positions, in-
cluding in the defence and security, is good testimony to expose
government’s double-standard. For instance, Police Inspector-
General Ephraim Mateyo and Zambia Air Force Commander
General Samuel Mapala are all on contracts. We understand
that Banda was due to get a fresh contract but suddenly things
changed, prompting speculation on the real reasons behind his
exit. Ever since he was appointed to steer the ACC, Banda had
been upright in his dealing. His boldness to fight corruption often
landed him in problems with influential people in the current gov-
ernment. One prominent case is that of the Drug Enforcement
Commission (DEC) where he steadily intervened and arrested
key persons, including former Commissioner Ryan Chitoba for
corruption. Chitoba and his ex-deputy Jacob Koyi are current-
ly in court facing criminal prosecution. Chitoba promised t fix
Banda. Attempts to discredit him in the media as a corrupt-man
were orchestrated but to no avail. At some point, the Law As-
sociation of Zambia (LAZ) intervened in the matter after Banda,
a lawyer and member of the LAZ, was accused of corruption.
LAZ cleared him after he appealed before one of its commit-
tees. Banda was never short of controversy. He angered the
magistrates’ after he accused them of lacking capacity to handle
high profile cases. Subordinate courts boycotted handling ACC
cases until he apologized for his remark. And government has
now said ‘nix’ to Nixon.
Key Events in July
• Zambia International Trade Fair – [2-8th July 2008]
• Commonwealth Parliamentary Association –
Africa Region Conference [11-19 July, 2008]
• Smart Partnership Conference – [28 – 31 July, 2008]
• Commissioning of first phase of Lumwana Copper Mines
(LCM) – Dates to be announced
15
Profiles
Executive Newsman
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