.jpg)
Across East Africa, the peaceful transfer of power between opposing parties has not always been commonplace. There are structural barriers which often disadvantage the challenger, meaning even if elections are observed and well-run, the popular will is not always reflected in government. It’s lazy to presume malfeasance, though this sometimes occurs. More often, though, the lack of a clear delineation between politics and the organs of state, means it is easy for incumbents to maintain power. This fact was relevant prior to coronavirus but has gained saliency since routine lockdowns and restrictions on activity have been introduced all over the world.
Therefore, the election of the challenger in Zambia’s recent presidential elections, has been met with excitement. In the days preceding the poll, there was hushed optimism in Lusaka, with people daring to believe it would be possible to elect somebody with some of the credentials necessary to strengthen the economy. Edgar Lungu was the sixth President of Zambia, and was in power since 2015. Taking over the office through presidential by-election following the death of Michael Sata, he served a further full term between 2016 and 2021. Though disputed at the time, his victory was duly declared by the Zambian Electoral Commission and he led the country for six years.
The Zambian economy relies principally on mining and agriculture. One of the largest copper producers in the world, it is highly susceptible to changes in global commodity prices. Thought to account for nearly 85% of total national exports, the direction and depth of demand from manufacturing weighs heavily on annual economic performance. A host of junior and senior miners are active in the country with routine approvals of schemes designed to capitalize on this strategically important component of the economy. In the mid-term, copper’s fundamental role not only to conventional construction, but in emerging technology and the electrification of vehicles, means it is a useful endowment. Agriculture- which makes up the residual part of the economy- is the main employer in the country. Much innovation has occurred, with maize remaining the principal cash crop the country is known for.
In spite of these sectors, though, Zambia finds itself in a difficult economic position. The African Development Bank Group (ADBG) report a real terms contraction of 4.9% in 2020, compared with growth of 4% in 2018 and 1.9% in 2019. Initially it could be argued the decline in demand for commodities was particularly harmful to the economy, however, with disruption in copper projects in Latin America, it is now once again holding up and making a strong contribution. Instead, the ADBG highlight high inflation, widening fiscal deficits and unsustainable debt levels as the likely challenges facing the new President. Widely lauded for his background in business, Hakainde Hichilema, presents an interesting profile for addressing these varied and complex issues.
Reportedly the largest cattle rancher in the country and alumnus of Grant Thornton and Coopers and Lybrand Zambia, he certainly benefits from resilience. Having led the United Party for National Development since 2006, he has stood for election on six separate occasions. In this last instance, he won with 59% of the vote, which constituted the sort of landslide needed to ward off disputes or lengthy judicial wrangling. Not only this, he saw off a ludicrous accusation of treason in 2017, when a minor traffic transgression was deemed by Lungu as an attempt on his life. Married with excessive police force and intimidation of family members, it is all the more remarkable he once again put himself on the ballot, let alone won.
The widespread condemnation of the governmental agencies engaged in his incarceration seemed to foretell an increasingly authoritarian regime intolerant of any dissent from the party line. The fact this seems to have been staved off by an election where power has transferred peacefully, is a mark of pride in Zambia’s institutions, and more importantly, its people. This is not to say Hichilema, does not warrant scrutiny, since commentators continue to level accusations, not least following his disclosure in the Panama Papers. But it does provide room for optimism.
There is doubtless relief amongst the business community and many international organizations invested in the country. The new President will be judged not only on his ability to offer a more equitable distribution of wealth in society but also on the restatement of a free press and vibrant democratic norms. More relevantly, he will be judged by Zambians on his commitment to the Economy Recovery Programme which is slated to run until 2023 and address some of the main structural issues afflicting the country.
The ADBG report growth is set to hit 1% in 2021 and 2% in 2022, on the basis of recovery in tourism, manufacturing and mining. The truth is, though, even if the pandemic subsides, and enables the expansion of some of these sectors, sustainable debt levels and a stabilization of the macro economy will be fundamental to delivery steady progress, as opposed to aggressive cyclicality witnessed in so many commodity-rich economies. The ABDG offers a concise roadmap to its achievement: reducing new external debt, increasing domestic revenues, and stronger institutional financial management. As ever, the prescription benefits from simplicity but the medication requires commitment and unpleasant decisions which aren’t always electorally popular. In the calm after the storm- where temporary enthusiasm gives way to crude economic calculation- investors will be watching closely, willing the new government to succeed.
