PRESS STATEMENT FOR IMMEDIATE RELEASE
NEW HERITAGE PARTY RESPONSE TO RECENT IMF STATEMENT ON THE EFFECTS OF FUEL SUBSIDIES ON COUNTRIES WORLD WIDE.
03/07/24
The NEW HERITAGE PARTY wishes to address recent statements made by the IMF Resident Representative, Mr Eric Lautier, who has asserted that fuel subsidies only benefit the rich and wealthy in our country and that, therefore, as a country we should not consider effecting measures to subsidise fuel and by implication not to even consider subsidies on other strategic social and economic needs such as agriculture inputs.
This claim, purportedly supported by numerous unspecified studies conducted in various countries, lacks transparency and specificity. The Resident Representative did not identify the institutions responsible for these studies, the countries where the research was conducted, or the conditions under which these conclusions were drawn. It is worth noting though that in the same statement, the Resident Representative goes on to say that “they (the poor) are also the less able to absorb some of the additional cost brought by the removal of the subsidy, both through higher energy costs of cooking, heating, lighting, and personal transport and through higher prices for other goods and services, including food,” he said.
Such generalized and contradictory claims against fuel subsidies, and subsidies in general, are a familiar IMF norm and which are included in their conditionalities. This approach has been historically imposed on countries that engage in IMF debt restructuring programs, often disregarding the unique socio-economic conditions of the client country. The consequences of these policies have been devastating for many nations.
Examples of the adverse impacts of IMF-imposed conditionalities are abundant. In Greece, the austerity measures led to severe economic contraction and widespread hardship. In Ghana, similar policies resulted in significant socio-economic challenges. Recently, Kenya has faced considerable difficulties under these conditions.
Zambia is experiencing the same devastating effects for a second time. Our country remembers all too well the food shortages, riots, and attempted coups that followed the implementation of such policies. These conditions contributed to the downfall of the UNP government under Dr. Kaunda, bringing about significant turmoil and instability.
The New Heritage Party stands firm in opposition to the IMF Resident Representative’s assertions and the broader IMF agenda that often overlooks the specific needs and realities of individual countries. We believe that a more nuanced and context-sensitive approach to economic policy is essential for sustainable development and the well-being of our people.
We urge all stakeholders to critically examine these generalized assertions and consider the historical evidence of their impact. Our priority must be to develop economic policies that are tailored to our unique circumstances and that prioritize the welfare of all citizens, not just a select few.
As the New Heritage Party, we are convinced that the real reason why the IMF is against subsidies in countries under their debt restructuring programmes, is because they want to ensure that priority is given to debt servicing, which directly benefits their masters, and shareholders, in this case, mostly the Western countries, the bond holders, and vulture funds that they represent. They are merely playing their gangster role of “enforcer” on behalf of these entities. It is the reason why that in addition to removal of subsidies, they insist on removal of vital taxes on cash outflows by foreign companies involved in the large-scale exploitation of our minerals and other natural resources, including land.
As a party founded on the principles of the protection of our national heritage, namely, our land, and all it’s mineral wealth for the exclusive benefit of Zambian citizens, now and in the future, we strongly condemn this neo-colonial stance by the IMF through its local representative and their Zambian collaborators, the UPND government. It is a great shame that a foreign entity such as the IMF, can order our experts, technocrats and government officials to gather and be made to rubber stamp a foreign inspired agenda against their own country.
CHISHALA KATEKA
President – New Heritage Party