IRIN Focus on poverty reduction

The Zambian government has produced an interim Poverty Reduction Strategy Paper (PRSP) for the International Monetary Fund (IMF) and the World Bank as a forerunner to qualification for debt relief under the heavily indebted poor countries (HIPC) initiative, government sources told IRIN this week. A government official said in order for Zambia to qualify for HIPC status, the PRSP will be used by the IMF and World Bank as a yardstick to determine whether the country can access concessional lending by next June. "Zambia's qualification for debt relief under HIPC will be determined by its track record in performing according to expectations in the PRSP and those of the two institutions," the official said. He added that the extent of relief on Zambia's US $7 billion debt under HIPC will be decided by the IMF and World Bank. Debt relief When deciding to grant debt relief the Bretton Woods institutions will look at the total circumstances of Zambia and write off a major part of the debt, leaving the country with a "sustainable" burden, the official said. Debt servicing has averaged US $217 million annually over the last eight years. Zambian NGOs said the Zambian government seems to be showing more commitment to work with civil society groups in finding solutions to the country's poverty crisis, which the government says affects up to 73 percent of the nine million population. The NGOs, however, believe the government and Bretton Woods institutions' emphasis on macro-economic stability has not had the desired result of addressing poverty levels. Said Pete Henriot of the debt cancellation lobby group, Jubilee 2000: "The government lacks an integrated framework to address the poverty crisis. The PRSP proposals are more of a wish list than effective strategies to reduce poverty." Poverty levels have continued to climb despite a nine year old donor-backed Structural Adjustment Programme (SAP). Rural poverty is particularly deep, while unemployment in urban areas is endemic. Per capita GDP has fallen from US $438 in 1975 to US $300 in 1997. Victor Chinyama of UNICEF told IRIN that studies show that 50 percent of Zambian children under five are malnourished or stunted. Maternal and infant mortality rates are also on the rise. Revenue base shrinks The main problem facing the Zambian government, analysts say, is its inability to adequately fund social services. With the fall in world copper prices, its copper-dependant revenue base has shrunk from 30 percent of GDP in the 1960s to less than 20 percent in the 1990s. But Grace Kanyanga of the NGO Coordination Committee (NGOCC) told IRIN: "The SAP policies place more emphasis on economic growth to the exclusion of human development." She added that government decision-makers do not seem to have been sensitive to the needs of ordinary people who have to bear the brunt of these programmes. Chrispin Mpuka of Jubilee 2000 claimed the government's spending priorities are wrong. "Budgetary allocations have not been sufficiently geared at poverty reduction and social services." He said the government needs to adopt policies that are pro-poor and channel more allocations to the social sectors.