Govt to borrow directly from Chinese banks
By Staff Reporter
The government has resolved that from now on it will only prioritise road projects that are of economic benefit.
And the government has resolved to borrow directly from Chinese banks instead of using contractors.
Since forming government in 2011, the Patriotic Front administration has embarked on a reckless countrywide road construction, resulting in huge borrowing.
According to a statement released on Tuesday by special assistant to the President for press and public relations, Amos Chanda, cabinet made these resolutions in its last meeting.
“… Government to source financing directly from Chinese banks not through contractors: This will reduce the cost of borrowing for developmental programmes. Government will accelerate infrastructure through the construction of roads countrywide, building of universities, schools, hospitals, clinics and health posts in line with the PF manifesto to improve the lives of the people especially the poor,” Chanda stated.
“Only projects with the highest economic returns should be prioritised for loans from China: In order to ensure wider benefits to the citizens, Cabinet has decided that government identifies projects that would provide highest economic returns to the citizens. Further, Cabinet decided that the rest of the pipeline projects that have been identified for implementation should be implemented through public private partnerships (ppp) and joint ventures.
Cabinet also resolved that projects of a social nature should be pursued through grants to reduce stress on the Treasury.”
Chanda further revealed that cabinet approved the country’s membership to the African Finance Corporation (AFC).
The AFC is a multilateral development finance institution established on May 27, 2007.
Its main objective is to lead in the financing of infrastructure development in Africa.
“The joining of the Corporation will therefore provide Zambia with opportunities to pursue its infrastructure development agenda and significantly reduce the current pressure of financing projects,” he stated.
And cabinet has approved the National Construction Authority Bill 2018, which will repeal and replace the National Council for Construction.
“Though our construction industry has been growing, we have not realised full growth potential in the industry due to the enactment of the various pieces of legislation that are riddled with a lot of conflicts with the National Council for Construction Act,” stated Chanda.
“The enactment of this bill is expected to address and subsequently harmonies the conflicting pieces of legislation so that the Regulator can effectively regulate the Construction industry. It is important that we regulate this industry, as construction is one activity which can bring about quick wins regarding job creation in the country as has been seen through the massive construction projects Government continues to implement.”
