DEBT RELIEF TO GROW ZAMBIA’S ICT SECTOR
July 12, 2023
Government says Zambia’s debt restructuring programme of $6.3 billion is set to grow the country’s Information and Communications Technology sector.
The sector that provides an opportunity for Zambia to address the digital divide and reduce poverty while registering economic growth is poised to be the fastest growing sector in the country.
This was revealed by Minister of Technology and Science Felix Mutati during the Impact Connect News Makers Forum in Lusaka last evening.
Mr. Mutati said the sector is expected to grow by 40 per cent this year as investors were waiting for Zambia and its creditors to reach a deal to restructure billions of dollars of loans to Zambia, ending a long impasse over the country’s 2020 default.
“It is growing by 40 per cent because last week, we granted three international licences to three companies; BCS, Baobab and AirtelTelesonic leading to an aggregate investment of atleast $55 million,” he said.
He said the companies were waiting for a trigger to invest their money and the trigger came in form of debt relief.
Mr. Mutati further revealed that Liquid Telecom is also expected to deliver the biggest data centre and innovation hub in the country and Southern Africa with a connection of 1,300 secondary schools to internet.
He expressed optimism that the connection of schools to the internet will improve the provision of education and make children to be part of the digital world.
Mr. Mutati assured citizens and stakeholders that the New Dawn Government will deliver internet connectivity in the remotest part of Zambia by the end of July 2023 and no Zambian will ever be out of connection.
Highlighting other benefits of the $6.3 billion debt restructuring agreement, Mr Mutati said that the agreement paves way for the disbursement of $188 and $75 million from the International Monetary Fund (IMF) and World Bank respectively.
The Technology and Science Minister also disclosed that the agricultural sector has already received $14 million to support over 30,000 small scale farmers who are going to be given K5,000 each in order to elevate them from small scale to commercial farmers.
Mr. Mutati further said that the debt relief will boost the financial sector as players in the sector such as banks have been granted that rear freedom to be able to access international capital without shame so that they can be able to find opportunities for the investment community and earn new streams.
He expressed happiness that the debt restructuring deal allows Zambia to be paying $75 million per annum as opposed to the $600 million paid before the deal was clinched.
He said the key ingredients leading to the successful debt restructuring programme are anchored on Zambia’s strong leadership, determination and steadfastly remaining focused on the transfiguration of Zambia’s economy.
Meanwhile, Mr. Mutati said that Zambia’s agreement on a debt treatment with her official creditors is the biggest deal under the G20 Common Framework of debt relief and significant milestone in the country’s journey towards economic recovery and growth.
Speaking at the same event,
Centre for Trade Policy and Development (CTPD) Public Finance Researcher Matrina Mumba said her organisation has been working with the government in simplifying and disseminating information about the debt issue to the lowest level and providing checks and balances.
“We are one of the institutions that redflaged on the aspects of debt in the previous regime. We spoke about the huge debt that the previous regime was accumulating,” she charged.
She said CTPD is supplementing government efforts in explaining what debt restructuring means and the benefits that it has for the country.
And University of Zambia Students’ Union president Chandra Choongo said the debt burden had been chocking the country for too long hence the restructuring programme will alleviate its negative effects.
Mr. Chongo expressed confidence that the agreement reached for Zambia’s debt to be rescheduled for over more than 20 years with a three-year grace period during which only payments on interest are due will have a positive bearing on students.
He expressed confidence that the debt restructuring deal will enable government to increase budget allocation to the education sector.
He said students remain expectant that the government will expand infrastructure in higher learning institutions to accommodate the swelling number of students seeking tertiary education.
Zambia recently reached a debt restructuring deal, an agreement that signifies a crucial turning point in the country’s economic recovery and holds the potential to unlock vital financial resources, propelling the nation towards a path of stability and growth.
While in opposition, President HAKAINDE HICHILEMA promised to restructure the country’s debt management system which many have described as a milestone campaign fulfilment.
The Impact News Makers Forum was attended by Ministry of Information and Media Director Spokesperson Thabo Kawana and other stakeholders.
(C) THE FALCON