IMF urged to understand privatisation concerns

President Levy Mwanawasa has called on the International Monetary Fund (IMF) not to force Zambia to complete the privatisation of key public firms, the state-run Times of Zambia reported on Tuesday. Mwanawasa said shortly before private talks on Monday with IMF assistant director for the African department Robert Sharer, that Zambia was not against privatisation per se, but the manner in which the exercise had been conducted. Mwanawasa said that rather than benefiting Zambians, privatisation had contributed to high levels of poverty, loss of employment and asset stripping. "This administration felt that it is necessary and essential to revisit the method by which government exits itself from public property," the newspaper quoted him as saying. Sharer's visit comes in the wake of the government's decision not to proceed with the sale of three state enterprises, the power utility Zesco, the telephone company Zamtel and Zambia National Commercial Bank. Mwanawasa said his government after 13-months in office had managed to take significant steps to revive the economy, but still had a long way to go. "We felt that we should put our case to you in the hope that you will see our point of view so that we can go ahead and do what we were elected for, that is to develop the country and make life a lot easier for the Zambian people," Mwanawasa said. Sharer, who was accompanied by IMF resident representative Dr Mark Ellyne, reportedly said he was impressed with the way the government had moved from the 1980's era of high inflation and low economic growth, and that the bank was ready to help it meet its future challenges. He said the IMF had in the last four years given Zambia US $700 million in debt relief and disbursements in support of the country's economic programme. But Ellyne reportedly earlier warned that Zambia's qualification for greater debt relief under the Highly Indebted Poor Countries (HIPC) initiative could be jeopardised if the government balked at the sale of the bank and the two public utility companies. Zambia, whose foreign debt stands at more than US $6.5 billion, was supposed to reach Completion Point under HIPC at the end of this year, but on condition that they privatise the remaining parastatal firms.