Ambassador Speeches

Remarks by U.S. Ambassador to Zambia Carmen Martinez on Debt Cancellation: Keeping Promises

Lusaka
December 30, 2005

When Zambia embarked on its path to the Heavily Indebted Poor Countries (HIPC) completion point, the American people made a promise to the people of Zambia. We said we would cancel your government's debt to us if your government improved its control of spending, did more to reduce poverty, and implemented a policy framework to promote growth.

The government of Zambia did those things, and now it is time for us to keep our promise. The goal of America's engagement with Zambia is to help the people of this country enjoy prosperity in peace and good health. Canceling debt to reduce poverty -- and that is what HIPC was all about -- is a good way to do that.

Having kept our promise to cancel Zambia's 280 million dollar (about 950 billion kwacha) bilateral debt, we look to the future. It is always tempting to make statements about Zambia's future. When a country is so richly endowed with natural resources and remarkable people -- when a country has so much promise -- hope for the future is natural.

However, the past tempers our expectations. Weak fiscal control has a long history in Zambia. Heavy borrowing and large arrears are entrenched habits. But we are here today to sign this agreement because those habits, like Zambia's onerous external debt, are on their way to becoming a part of history.

The policies that made this cancellation possible also amount to a promise -- a promise from Zambia's government to the citizens of Zambia -- that debt will no longer be the foundation of the government's budget. This is another good promise to make, but it is not so easy to keep because it requires responsible officials who will say no to irresponsible spending.

Good ministers of finance have to be good at saying no. I believe Honorable Magande -- who is a good minister of finance -- can confirm that. It is especially hard to say no as an election approaches, so his job will not be any easier in the new year that starts on Sunday.

Keeping that promise to be a good fiscal manager, a careful steward of the economy, and a wise partner to the private sector is a necessary step toward helping Zambia achieve its promise -- the promise of prosperity that comes from having a rich natural endowment and many remarkable people.

A minute ago I said that America's engagement with Zambia serves the goal of health and prosperity. That means we are eager to help the people of Zambia achieve this goal, but we all know that it is not up to us or anyone else who is not a Zambian. As we say at home, this is your ball game. As debt relief lifts Zambia's financial constraints, there is more room to maneuver. You can make more choices. Indeed, Zambia will face the same choices it had a generation ago, when it began to accumulate the debt burden that has just been lifted. Fundamentally, that choice is this: Will the government once again spend its way into unsustainable debt? Or, will it give the private sector room to invest so that there are more jobs, less poverty, and greater prosperity? Will it invest in the people of Zambia by increasing support for health and education? Will Zambia's government and its citizens succeed in turning back the tide of corruption that undermines the economy? Will the people enjoy in full measure the rights that allow them to hold their leaders accountable for their response to these challenges?

Having recently arrived in this wonderful country, I hope to see for myself the progress Zambia will make toward fulfilling its promise. As we embark on a new year, I look forward to working with you, Honorable Magande, your colleagues in government, and President Mwanawasa to make the most of the opportunities this new year will bring.