Zambia’ has been fortunate in one sense: our leaders, from the very beginning, have all been individuals with big hearts who genuinely care for the people. While we often criticize them during their time in office, history shows that, after they leave, we can clearly see their intentions—they were trying, in their own way, to improve the lives of Zambians.
A prime example of this is our first president, Kenneth Kaunda. Kaunda’s deep commitment to the welfare of the Zambian people led him to make some bold, and often controversial, decisions. One of the most significant was the nationalization of private companies. He believed this would provide more jobs for Zambians and allow the profits of these companies to be reinvested into essential services such as education and healthcare. Kaunda also imposed price controls on basic commodities, ensuring that essential goods were affordable for the population.
While these actions came from a place of genuine goodwill, they resulted in an economic disaster. Economic principles are indifferent to the heart’s good intentions. Nationalization of companies, for example, doesn’t work because companies thrive on profit incentives, not social goals. When companies are motivated by job creation rather than profit, they often lose money, making those jobs unsustainable. Similarly, price controls, though well-meaning, create shortages. People may have money, but if there are no goods available to buy, it’s all for nothing.
President Hichilema Policies Can’t Fix Zambia Economy
Today, President Hakainde Hichilema (HH) embodies the same compassion. Like Kaunda, he has a deep desire to help his people, and it’s clear he spends sleepless nights grappling with the country’s challenges—rising commodity prices, power shortages, a weakening currency, and more. Similarly, former presidents Michael Sata and Edgar Lungu, from the PF party, also had good intentions, yet struggled to achieve lasting economic improvements.
The biggest issue is that Zambia’s leaders have repeatedly fallen into the same traps as Kaunda did. The mistakes of the past seem embedded in Zambia’s DNA, and the policies of our current government reflect this. Take HH’s initiative to reintroduce free education, for example. While the policy is driven by a desire to offer more opportunities to the country’s poor, the long-term consequences are troubling. HH is also expanding social cash transfer programs, hiring thousands of people for government jobs, and spending heavily on various initiatives meant to uplift the population.
However, as with Kaunda’s time, these generous policies may end up doing more harm than good. The people HH is trying to help could find themselves suffering the most from these high-spending policies. Instead of lifting them out of poverty, these measures may only prolong it.
Zambia needs a thriving economy, where private businesses can grow, create jobs, and help people earn better wages. But that requires an environment where businesses are free to succeed. High taxes and heavy government spending undermine this growth, making it difficult for companies to expand and hire more people.
To support his ambitious social programs, HH must keep taxes high. But the result is a stifling of private sector growth, leading to fewer jobs and more poverty. The cycle continues: more government spending leads to more taxes, which leads to fewer private sector profits, which results in even more government spending. And so the cycle repeats. This echoes the situation of Kaunda’s time, where the people’s suffering was only exacerbated by policies that were meant to help.
In addition to high taxes, the government has resorted to borrowing to cover these costs. However, borrowing only adds to the burden. To repay this debt, the government has to extract even more taxes from businesses and workers, squeezing the economy even further.
While President Hichilema is not nationalizing companies like Kaunda did, the result is effectively the same. Private businesses are being suffocated under high taxes, and the outcome is layoffs, stagnant growth, and a prolonged period of poverty for the average Zambian.
At this point, Zambia has little chance of economic recovery unless we radically shift course. The key to recovery lies in drastically reducing taxes for businesses and workers, which can only be achieved by significantly cutting back on government spending and borrowing. Only by creating a business-friendly environment, with lower taxes and less government intervention, can Zambia truly unlock its economic potential.
