25 Sepember, 06.
‘Bad laws are the worst sort of tyranny’
(Edmund Burke)
The recent appointment by the President of Zambia of the members of a Commission which is answerable only to himself and whose mandate is to promote by ‘whatever actions are necessary’ the economic empowerment of ‘targeted citizens’ i.e. black and indigenous Zambians, is both ominous and unsettling, particularly for us investors who can now look forward to some intensive predator-prey interactions as the Citizens Economic Empowerment Act No 9 of 2006 starts to have its merry way with us.
The CEE Act makes no bones about the powers given to the President (appointing the members, directing it what to do) and to the Commission: (giving instructions or directions to any State institution or a company, taking ‘whatever actions necessary to ensure broad based economic empowerment of targeted citizens, citizen empowered companies, citizen influenced companies and citizen owned companies.’), making it abundantly clear just how an investor is viewed by the Government of Zambia on 24 September 2006.
As a foreign investor in rural development who is also a member of Business Action for Africa, what might be my objections to such legislation? Well, for a start, as a paid up member of the Western Liberal Democratic Club – presumably the same one the Government belongs to, this legislation closely resembles Lenin’s decree for the establishment of the People’s Commissariat of State Control in 1919, with Stalin as its first Commissar, legislation imported from the only country in Africa still with a communist party, South Africa. The go-between for the transfer of this racially based legislation is J.J. Sikazwe, a member of the Zambia International Advisory Council, senior policy advisor to BP, Chairman of the Tourism Council of Zambia (TCZ), and coincidently, Chairman of the first ‘empowerment’ company in Zambia, Legacy Holdings Zambia, recently given a 75 year tourism lease by the Zambia Wildlife Authority (ZAWA) to build two large hotels, an 18 hole golf course and 400 or so chalets in the tiny Mosi oa Tunya National Park at the Victoria Falls – a World Heritage Site. And despite the Vice-President laying a foundation stone, accompanied by an extraordinary and virulent attack on foreign tourism investors, no environmental impact assessment has yet been accepted by the authorities.
And why the need for such legislation? After all, Apartheid passed Zambia by, and unlike Zimbabwe, we were never a Crown Colony where large areas of land were alienated to European settlers. In fact this alluring patch of Africa with its friendly people was administered first by a company having a Royal Charter - whose first act was to put down the slave trade and build a railway, followed by Imperial Government rule for a mere 40 years from 1924 – 1964, a time of Lord Lugard inspired, Indirect Rule, with the administration conducted through the chiefs and with customary land fiercely protected from European settlement, a blimpish, wonderfully-dedicated-to-the-cause-of-the-black-man, at times blundering administration that got tired of trying to bring on the natives and simply went home to tea and crumpets. The CEE Act appears therefore set to rectify a mythical colonial wrong, to wrest some of the control and ownership of businesses from those who came to Zambia more recently and who are not black Africans. But the CEE Act will not encourage investors to enter into partnerships with the natives, as is happening in Mauritius and Ireland and China. It will simply close the borders and allow the natives due license to harvest the products of existing producers. Humbug, of course.
And of course, the first sector to come under the Commission’s scrutiny will be the tourism industry, white run and white owned, many being Zambian but not ‘targeted citizens’ – and agriculture apart, the only other source of income for the 94% of Zambia under customary tenure. And of course tourism is the main source of income for the statutory body responsible for wildlife and protected areas, now transposed into a modern cash-cow called the Zambia Wildlife Authority which has already started its empowerment role by taking away the hunting safari concessions of three companies on dodgy legal grounds, and, although temporarily delayed by a legal writ, about to grab the concessions of a further six areas – some 25% of the industry; and hunting is the sole support of Community Resource Boards and the wildlife in a third of the country.
The grand irony and most indigestible bit of all – particularly for those of us whose governments have written off the debt and who continue to lend more, is that the CEE Act was introduced by Zambia when she had just become a fully paid-up member of the international community. After all, she was a solid supporter and contributer to the Commission for Africa, (now dynamically expressed through its organization, Business Action for Africa) - formed to assist Africa raise the living standards of its people, which persuaded the G8 Group of Nations at the Gleneagles Summit to write off much of Africa’s debt in return for undertakings by African countries to improve standards of governance. As a result, once Zambia achieved the Highly Indebted Poor Country Initiative (HIPC) completion point in April 2005, most of the Paris Club creditors cancelled Zambia’s public debt, and the African Development Bank, the IMF and the World Bank - under the Multilateral Debt Relief Initiative, are doing the same. If to this is added the agreed commitment to the mission of NEPAD, the UN Millenium Development Goals and the African Peer Review Mechanism, Zambia is bent on self-improvement – with the help of the world
Instead, Zambia, which at Independence had the same per capita income as the Asian Tiger nations (now Hong Kong is 75 times richer, South Korea 25 times richer),
is, by all credible economic performance measures, upholding a tradition of lamentable economic governance by re-introducing an assets indigenization programme which flies in the face of all its commitments to good governance, partnerships and all other laudable development goals. Do not be fooled by the official statistics trotted out by Government, the IMF and its donor partners: the rampant corruption, the fuel shortages, the deplorable mismanagement of the exchange rate mechanism which saw the dollar lose 30% of its value, the inflation rate and the 2006 budget, which before a near riot to change it saw small scale farmers having to pay VAT on their crop inputs – but without the facility to reclaim it, is the reality. In agriculture we have lost many thousands of jobs.
Much of Zambia is under siege: the now rampant abuse of the savanna by fire – a major contributer by Africa to global dimming and the increasing brittleness of the environment; the depletion of wildlife due to the bushmeat trade and poorly regulated hunting; the second highest deforestation rate in Africa due to the charcoal industry and the illegal timber trade; the overfishing and pollution of our rivers and lakes; all of this contributing to a downward spiral of land capability impairing the prospects for the rural poor’s upliftment out of a witchbound and increasingly denuded environment – is reiterated in the preamble to Zambia’s draft National Policy on Environment of 2005. And most of the 19 National Parks, 35 GMAs and numerous National Forests are under only rudimentary protection and management; some Parks and Forests are already settled by people, some Parks being leased to infrastructural developers - or tourism concessions expanded without due process before the necessary environmental assessment work is completed (Mosi-oa-Tunya NP); a few National Forests (Mvuvye West NF) sold off illegally by the Ministry of Lands on statutory leases; and customary land - which includes the GMAs where some tourism is conducted, continue as a mere open access area where no ownership of natural resources is vested in the people and where the classic tragedy of the commons is being re-enacted.
