Thread by @FMwenge

In football terms, Zambia's recent reclassification from lower middle to low income country is like being relegated to a lower league from the premier. It's less competitive there, but not exciting & no growth. There's nothing to celebrate, we just went back to handouts. #Zambia

To many who follow these things though, the reclassification isn't a surprise going by sustained weakening of our macroeconomic policies in recent years, thanks to unsustainable debt levels, the energy crisis of 2015 & eventually COVID-19 recently as some of the reasons. #Zambia

Lower middle income status is good for many reasons: e.g higher average per capita income imply more DOMESTIC resources available for poverty reduction. Also means access to private capital markets: that's how we got Eurobonds, unfortunately not well spent.#Zambia

Low income status is bad, for related reasons: low average per capita incomes mean no domestic resources for poverty reduction... you depend on donors🥺. No access to capital markets, so no money to fund ambitious projects needed to spur growth e.t.c #Zambia

Suffice to say we wasted our lower middle income status. Instead of using it to access capital and invest in projects that could grow the economy, we invested in some projects that cannot even help us recover what we spent.

What I'm simply saying is, no one is ready to give us a Eurobond now because the low income status means we've no capacity to honor commercial debt obligations. So, we're back to relying on donor aid whose spending is dictated by the giver. #Zambia

You're not following. What I'm saying is, it is now hard for anyone to lend us money to construct a new airport like we did with KKIA and Ndola new airport. This infrastructure is key for growth. #Zambia

Lastly, we are back to survival mode. When we got Euro bonds, we were telling the world we are now ready to do what we want, we have the resources. And yes we got the money, did what we wanted, but may be did it badly.

Good day #Zambia