Zambia Think Tank Forum Issue 9
"Leading The Way Through Information"

Inside This Issue
1. Can Globalization Work For Zambia?
2. Apologies
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How can globalisation work for the poor in Zambia

By Norman Chipakupaku (UK)

In the last five years, the term globalization has been debated at almost
every world forum and is said to be the best way to address extreme poverty
in developing countries like Zambia. The international community led by the
United Nations has been working with other donors to try and meet the so
called development targets which is a vision and strategy to reduce the
current world’s poverty levels by 50% by the year 2015.That is reducing the
number of people living in poverty in Zambia from the current 8 million to
about 4 million before 2015.

These targets have increased the debate on globalization with a number of
people arguing that globalization is a major hindrance to economic
development in countries like Zambia. On the other hand, major donors
believe that globalization can be a major force for socio-economic
development. Hence the current visits by the IMFs’s Managing Director –Horst
Koehler to Africa in the next few days and the focus by the G8 on Africa.

The World Bank and other multilateral donors have and will continue to push
for globalization through major programmes to encourage dialogue in
macro-economic management policies. This approach is meant to help
governments and other stakeholders to formulate realistic and workable
policies which would help countries like Zambia to meet the internationally
agreed development targets which include the reduction of poverty by 50% in
the year 2015,increasing annual economic growth from the current level of 1%
to 5% and increasing investment from the current 14.5% of GDP to over 20% in
the next two years.

Zambia has many more challenges, which can prove that globalization if not
properly harnessed can cause more harm than good to the local economy. The
privatization of the mining sector and the sudden pullout of Anglo American
Corporation is a case which proves that multinationals can use globalization
to either improve or destroy the economies of developing countries. Many
other examples can be found in Zambia, which can support the argument that
globalization favours the developed countries at the expense of developing
countries like Zambia. Zambia’s express liberalization policies and the
socio-economic impact are currently being used to prove this argument.

In the last four years, the UK Department of International Development
(DfID) has opened up this debate on globalization by conducting annual
Development Forums to help shape the UK Government development policies.
According to the DFID and the UK government “globalization is a fact” and
the issues are “first and foremost about whether or not we can manage it,
rather than whether or not we want it” In short, the African governments
have no choice on globalization but need to manage it to their advantage.

This year’s Forum, which this author will attend, will be led by the RT Hon
Clare Short (Secretary of State for International Development) and will
focus on trade, the environment and the role of the private sector in
promoting economic development. The key questions are, how has Zambia
performed in linking the environment to its economic development
policies –what has happened in Zambia since the Rio Summit of 1992.While
Zambia still maintains about 60% of its natural forest, there is major
deforestation taking place as poor communities try to meet their daily needs
for domestic energy. What needs to be done in terms of solar power and other
renewables. What needs to be done to raise donor support. How can Zambian
companies be encouraged to invest in solar power and what are the current
problems.

In terms of international trade, has Zambia benefited from its membership of
SADC, COMESA and the World Trade Organization. The UK Department of
International and UNCTAD believe that Zambia and the rest of Africa stand to
benefit from opening up their economies. However, they both notice that
while the WTO rules state that governments should working towards reducing
trade barriers, the poor African states have played their part while Europe
and America still maintain subsidies and tariffs, which make it very
difficult for Zambian products to compete on the international market. In
the last two years, two thorny issues have raised in international trade.
Firstly, it was the introduction of Trade-related Intellectual Property
Rights (TRIPS), which have basically given multinational, companies the
monopoly over pharmaceuticals.

The second area which has generated a lot of debate in the WTO, is the
General Agreement on Trade in Services (GATS). According to this agreement,
governments in Africa are to open up their service industries and allow
multinational companies to buy and control utility companies. In Zambia,
this means allowing multi-nationals to buy and control The University
Teaching Hospital (UTH) Lusaka Water and Sewerage, ZESCO, Zamtel and ZANACO.
Many countries in Africa have rejected this blanket privatization and
countries like Ghana are leading the way ins rejecting GATS and demanding
that governments, civil society and the local private sector should be given
the chance to control these strategic services.

As this debate on globalization continues, one wonders what role the private
sector has to play in ensuring that direct foreign investment creates the
intended results of economic growth and job creation. The UK government and
many other multilateral donors believe that the private sector is the
driving engine for economic growth. Hence their massive support to the
private sector through its collaboration with the Commonwealth Development
Corporation and funding of the Financial Deepening Challenge Fund and other
projects. This support is targeted at building capacity in the private
sector and parastastals, like the Zambia Revenue Authority.

To contribute more effectively during this year’s Development Forum 2002 and
add Zambia’s voice to the UK development policies, Zambia Think Tank Forum
members are encouraged to make their contributions and views on the issues
raised by this author. All views raised will be tabled before Rt Hon Clare
Short and her team and further covered in future ZTT Forum debates. Members
of the ZTT Forum can also take part in an online forum, which will allow
Zambians to “talk” to Development Forum 2002 delegates on issues relating to
trade, the environment and the private sector. Log on www.dfid.commlive.com
to register your details and contribute your views. More information on
www.dfid.gov and tell us how globalization can be made to work for the poor
people in Zambia.
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We sincerely apologise for bringing this issue to you so late, we exprienced
some technical problems. Thank you for your patience and we look forward to
receiving your contributions to this topic.
Moderator

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