By Sean Tembo – PeP President

1. When Robert Southey composed and presented his poem entitled “The Curse of Kehama” in 1810, and introduced the phrase “…curses are like young chickens; they always come home to roost…” it is like he had peered into the future more than 200 years later and was describing the economic policies of the UPND administration and how they would boomerang, hardly two years after ascending to office in 2021.

2. As we speak right now, the Kwacha is in a free fall against all major convertible currencies, having crossed the psychological barrier of K26 to the dollar last Friday. Since we are an import dependant nation whereby we do not only import finished goods, but even the few goods that we manufacture locally, the bulk of the raw materials used are imported, this rapid depreciation of the Kwacha directly drives inflation and the shelf price of goods and services are shooting out of the roof. Therefore, every Zambian is feeling the pinch of the rapid depreciation of the Kwacha through the increased cost of living. Last week, my wife went to buy Christmas presents for our children. She decided to buy them phones this year to replace their old and ailing handsets. The phones she wanted to buy were fetching K3,000 each on a Monday, and we made a budget accordingly. By Thursday when she went to make a purchase, the price had changed to K4,200 each handset and the shop owner was blaming it on the depreciation of the Kwacha. I told my wife that I’ll buy the phones in Chachacha road as l believe that the shops at shopping malls sometimes exploit us as they want us to foot the bill for their expensive rent, but to my horror, the price in Chachacha road was even higher. So l gave the money back to my wife so that she can buy from the initial shop, and when she went there the following day, the price had moved from K4,200 to K4,600 !!! These are the hardships that the Zambian people face on a daily basis as a result of the rapid depreciation of the Kwacha.

3. This has exerted pressure on the policy makers in the UPND Government to do something to arrest this rapid depreciation of the Kwacha. Firstly they decided to pump in dollars from the strategic foreign reserves maintained at Bank of Zambia in an effort to mechanically support the Kwacha, but after depleting more than $1.6 billion in two years, the Kwacha remained resilient in it’s loss of value. In fact, the entire Special Drawing Rights (SDR) allocation that we received from the IMF on 24th August 2021 was depleted by mechanically supporting the Kwacha! They then decided to increase the Statutory Reserve Ratio (SRR) at Bank of Zambia in an effort to reduce the amount of liquidity in circulation, but to no avail. The Kwacha kept on depreciating. Then they decided to increase the monetary policy rate (MPR) again in an effort to reduce the amount of Kwacha in circulation, but again this policy measure had no positive impact. This meant that the depreciation of the Kwacha is not necessarily caused by an excess of Kwacha on the market, but rather due to a shortage of forex.

4. Subsequently, a few days Government announced and widely circulated the fact that they had received a $187 million disbursement from the IMF, in an effort to move the market and arrest the continued rapid depreciation of the Kwacha, but the market simply ignored that announcement. Two days later, Government made another announcement, amidst much pomp and fare, that they had received a $125 million grant from the World Bank, but again, despite the disproportionate publicity that was attached to this announcement, the forex market was unmoved, and the Kwacha kept on depreciating thereby breaching the record K26 psychological barrier last Friday, having breached another record psychological barrier of K25 barely 16 days ago.

5. So then the inevitable question that arises is; why is the Kwacha losing so much value against major convertible currencies, and what can be done to stem this tide? Well, the best way to describe the economic situation in which the nation finds itself is by borrowing the words of Robert Southey when he said in his 1810 poem; the chickens have come home to roost.

6. When the UPND ascended to office in August 2021, they implemented a number of strange and unsustainable economic and financial policies which favoured the mines and disadvantaged the nation. Firstly, they gave huge tax holidays to the mines, and the argument made by the Minister of Finance then was that this will attract further investment into the mining sector with a target of increasing copper production from about 850,000 metric tonnes per annum in 2021 to more than 3,000,000 metric tonnes by 2024. However, two years along the line, annual copper production has fallen to a record low projected at about 645,000 metric tonnes for the year 2023. So evidently, the Finance Minister’s argument that tax holidays to the mining sector will drive production did not and does not carry water. It is a frivolous argument.

7. Additionally, the VAT Refunds to the mining sector means that at any given time, mining houses have a more than sufficient supply of Kwacha such that they do not need to sell any of the dollars that they earn from mineral exports, on the forex market, for them to have Kwacha needed to meet their local currency obligations such as salaries. This has further killed activity on the forex market. In fact, our forex market is so thin at the moment that it can easily be significantly moved by a sale of say $10 million. The Kwacha can move from K26 to K25.5, albeit just for a few hours.

8. Then there is the issue of market confidence. Markets in all jurisdictions tend to be moved by major Government pronouncements. And indeed, even our forex market here at home was moved by pronouncements from the UPND Government at the beginning, but not any more. Why? Because there is usually no follow through by Government on the pronouncements that it makes, which has resulted in loss of trust. About a week ago, the President held his End of Year Press Briefing. One thing that was notable about that Press Briefing is that he kept on emphasizing that Government has closed the deal for an investor in Mopani Copper Mines and that the KCM investor agreement with Vedanta had also been finalized. Ideally, those are supposed to be major pronouncements which are supposed to move the forex market and bring about an appreciation of the Kwacha, at least even a small one. But guess what? The forex market was not positively moved by the President’s grandiose pronouncements. In fact, the Kwacha depreciated further after the President’s 4-hour speech! That, country men and women, is evidence of a total loss of market confidence in the nation’s political and economic leadership. This, of course, did not happen overnight but is a culmination of a series of unfulfilled policy actions by Government in the past two years. As Robert Southey said in his 1810 poem; the chickens have finally come home to roost. The only solution to our economic woes lies in a new SET of political and economic leadership for this nation. In the meantime, may God help us all.


SET 31.12.2023


  1. These are clearly policies embarked on by Hakainde, and Hakainde alone..and he bears full responsibility.
    It is him who is draining the nation’s resources through a CDF sink hole. An enhanced CDF which is just a conduit for thievery.
    It’s him who recruited over 60,000 public service workers increasing government expenditure while at the same time reducing government revenue through tax holidays for the mines. From where did Hakainde think he will get revenue to support a larger civil service??
    All the monies coming from the IMF, World Back are just going towards consumption.
    It’s him who was procrastinating on KCM plc and Mopani Copper Mines for reasons best known to himself. For over a year these two mines were off the table for discussion, as he continued preying for personal opportunities. For KCM plc to make the people of the Copperbelt suffer so that they can eventually accept the Vedanta vomit.
    I can go on and on, on Hakainde’s failed policies, but Sean Tembo has articulated well, it’s the chickens coming home to roost.
    Now the failed leader is on a war path with democracy, not realizing that an unstable political system can’t support a stable economy. Everything is anchored on a good political system. Come 2024, if he continues with daily arrests of opposition leaders, encroaching on the independence of the Legislature and Judiciary, and outright despotism, the Kwacha will reach K30 in the first quarter of 2024.

  2. SET, I think defunct tuPF really loosened some screws in your brain
    Just a simple question, which government would deliberately cause harm to its people?
    You even answered yourself, we don’t manufacture anything for export
    Did the UPND government find manufacturing taking place and foolishly decided to stop it?
    Are you blind to the clarion call by this government about value addition and invitation of foreigners to invest locally?
    Suppose you, me and others grow enough maize, aren’t you aware of the beneficial consequences?
    Defunct tuPF destroyed this country
    Give chance to HH7 to repair the damage. He doesn’t seek pleasure in Zambians suffering, but he’s to deliver that painful surgery in order to relieve the pain
    Uwakwensho bushiku bamutasha elyo bwacha

  3. A commendable critique. This is what I expect from a responsible opposition not childish posturing from Mwamba and Nakacinda

  4. But what is your suggestion? Long articles don’t help us anything. I could have agreed with you if the Kwacha fell to 24, 26 to a dollar within the first 2 to 6 months of the ND being in office. But they have tried to stabilize and maintained it for over two years, it has been below 20. Have you already forgotten that the ND found the Kwacha at 22, 23 when it came into power in August, 2021, don’t be shy, try to check your records. KCM and Mopani are back, we shall see what you will say when the same Kwacha starts appreciating. Where the Kwacha is now is at its actual position, there is no support whatsoever from the government and that’s what we want. We know that when it starts gaining, it will be the true appreciation and not an aided one. Not long ago, the Hon Minister of Finance told the nation that things will not be continuously going bad, very soon this same Kwacha will start gaining again. The Minister even warned us that some people not only in Zambia but also in Region and beyond will start complaining about the Kwacha’s strength. This is Economics my friend, if you don’t understand it, you just keep quiet. I have not talked about Lithium, Sugilite, Cobalt, Manganese, Gold etc, all these minerals are coming very soon and they will back and support the Kwacha to an unprecedented strength. Rome was not built in a day, just be patient, very soon you will marvel. But tifunseko, nanga ku Botswana munatabilanji? I thought the economy is better there, why coming to a bad one and start complaining almost every day without giving any solution. Give us your Botswana experience, we can be very happy to learn from it.

  5. On this one zero is completely right. One of the biggest campaign promises of HH was bringing the rate down instead they have taken the rate to never seen before levels in the history of this country. On this they have failed miserably.

  6. Any average person can identify any and all Problems in a given situation and that is where everything ends. Finding the Solutions to such problems differentiates “boys from men”


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