Zambia struggles with the plight of have-not nations

Zambia, its economic promise largely stifled by the world's recession, high petroleum prices, and persistent low prices for base metals, has the national problems which are symptomatic of the third world. Inherent instabilities pose serious problems for the West as well as, in Zambia's case, for Zambians and Africans generally.

As the world's third-ranking copper producer, Zambia prospered, particularly in the 1950s and after independence in 1964. But in real terms, a ton of copper fetches less in the 1980s than at any time since about 1958.

Meanwhile, the costs of producing a ton of copper in Zambia have risen in real terms. Each ton Zambia exports is sold at a loss. Yet the nation has no other significant source of foreign exchange and has thus continued to export refined copper year after lossmaking year.

Metal specialists expect no near-term return to high demand for copper or other base metals. Even Zambia's strategic supplies of cobalt fetch low prices.

Based on the good years of copper, Zambia expanded an already highly geared and comparatively modern economy in accord with healthy returns from copper sales. It built roads and schools, necessary after colonial neglect; began spending large sums on military hardware; and created a number of state-owned industries, financial institutions, and service operations. The bureaucracy naturally grew.

Led by President Kenneth Kaunda, Zambia emerged from the 1960s as an important and respected middle-rank African power. During the white insurgency period in Rhodesia (1965-79), Zambia was on the front line between white and black in Africa and suffered economic and military blows as a result of its support for the guerrilla insurgencies against Rhodesia and South African control of Namibia.

When Rhodesia became Zimbabwe in 1980, Zambia's problems were expected to end. Instead, they intensified. Copper prices continued to fall. Foreign-exchange reserves steadily declined. Zambia borrowed. Today it is among the five most indebted third-world states, according to the International Monetary Fund. It also has an overvalued currency, and serious problems with the IMF.

The ordinary payments queue for Zambians to change money into dollars has been about 25 months long for several years. Manufacturers of commodities, like pharmaceuticals, often refuse to supply Zambia without cash payment. For that reason the mines lack essential plant and spare parts, the Ministry of Health cannot ensure steady supplies of vaccine, a soft-drinks monopoly cannot produce for want of caps, and local flour mills have flour but no sacks.

In general, most of the industries developed in the 1960s and '70s to permit Zambia to become self-sufficient (auto assembly, tiremaking, and so on) largely depend upon imported parts and raw materials.

In early September, the minister of agriculture reported that he was ''battling'' with the Bank of Zambia to arrange a means of paying for about $4 million worth of fertilizer which had been shipped from overseas but was held up at ports in South Africa. Likewise he was upset that the bank was withholding foreign exchange with which to pay for emergency supplies of seed maize. Zambia's farmers sow in November and depend upon seed maize and fertilizer.

Zambia is in many ways an extreme example of acute national distress in the third world. In addition to its long-term reliance on a single raw material, copper, for about 96 percent of foreign-exchange earnings, and its overwhelming dependence on expensive imported petroleum, it must also import about 50 percent of its staple food. In the colonial period and into the 1960s Zambia was largely self-sufficient in maize, meat, and milk. But with rising African incomes, neglect of the indigenous farming community, and hostility toward the few but productive white maize, tobacco, and beef farmers, supplies of basic foodstuffs grew less and less sufficient.

Most damagingly, Zambia made the mistake of most new third-world governments. Instead of providing realistic economic returns for farmers (black and white), the state subsidized consumer costs for urban dwellers.

Because staying at home on the farm made less and less economic sense, and because the state catered to townsmen, rural dwellers swelled the populations of the cities. By 1980 Zambia had become 60 percent urbanized, arguably the most intensely citified sizable country in the third world. This increase has put new and expensive pressure on the social services of the urban areas of the country.

During a long period of economic weakness Zambia has been unable to satisfy the aspirations of its urban and increasingly middle-class population. The impact of the world recession has intensified its already serious problem of widespread unemployment. Housing is short. Food scarcities recur, and the state-owned corporations frequently report an inability to supply first this and then that basic commodity.

In an atmosphere where mismanagement and inefficiency are taken as norms, and foreign-exchange permits or supplies of essential goods are crucial perquisites of privilege, the temptation for officials to embezzle, steal, and be bribed is common. In September, for example, the minister of power, transport, and communications was officially accused of embezzling large sums from a disaster relief fund.

The West worries about whether countries like Zambia will simply lose the ability to satisfy their citizens, pay their debts, and avoid being perpetual charges on the world welfare system. The primary producers of the third world have asked for relief from the West in terms of guaranteed high prices for raw materials. The West wants a curb on corruption and politicized, ideological mismanagement.

At the moment there are few workable solutions which would be acceptable either to the free-enterprise nations of the West or the state-controlled economies of Africa. Without a solution, it is clear that authoritarianism and military rule, bankruptcy, and further downward economic spirals are certain to mortgage the growth and prosperity of the many countries in Zambia's precarious position.

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