Zambia’s populist King Cobra rattles business

from the Financial Times..

May 15, 2013, By Andrew England in Lusaka

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When Michael Sata, the political veteran whose combative style earned him the sobriquet “King Cobra”, won Zambia’s elections 18 months ago, his victory sparked high expectations among many of his countrymen – and ripples of unease among investors.

The populist promised to use the nation’s mineral wealth more effectively to benefit the six out of 10 Zambians who live below the poverty line in Africa’s biggest copper producer.

But some businessmen fear new policies – including rules to combat tax avoidance that come into force this week – could threaten the investor friendly image of one of Africa’s fastest growing economies. Zambia is forecast to grow 7.8 per cent this year and 8 per cent in 2014.

“The attraction of Zambia was economic liberalisation, privatisation, no forex controls. When people see the government interfering and other things, the reversal of some of the privatisations, we are not sure the economic environment is being sustained,” says a Zambian businessman.

…….

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In Kanyama, one of Lusaka’s poorest districts and a Sata stronghold, Esther Banda praises her president, describing improvements to roads, health clinics and schools. “He’s still doing things he promised, but the country is big,” she says.

Others, however, are less convinced, complaining of corruption and the lack of jobs. “The things he promised we are not seeing,” says Martin Katema. “He said in 90 days we are going to have money, but nothing has changed.”

Link to the entire article: http://www.ft.com/intl/cms/s/0/7cf754b0-bbdc-11e2-82df-00144feab7de.html#axzz2TZVfBzVW

 

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