Wednesday, September 19, 2007

State of despondence Part 1 – Unemployment

At the fall of the socialist model driven by Bashikulu Kaunda in 1990, the unemployment rate in Zambia was 22%. After more than a decade of a liberal economic model that effected the privatization of over 80% of the national economy, the rate of unemployment is now 85%.
The national economy had been, in a state of decline for many years when the Chiluba era adopted free market economics famously referred to as Penzanomics ( after the late Finance minister a major proponent of the model).
The free market model immediately eased commodity shortages that had been chronic before the model was introduced in Zambia. The Free market model continues to ensure equal supply for market demand. However, many blame frantic liberalization and hasty privatization for increasing unemployment in Zambia.

I believe, the hysteria and lack of critique that accompanied the implementation of the free market model and the privatization of key industries caused conditions; for missed opportunities to develop local enterprise and corruption that have served to exacerbate unemployment in the long term.

When ZCCM was unbundled and privatized, the former IT department seized on the opportunity; to morph into an internet service provider CopperNET that continues to provide employment. If such opportunities were explored in other sectors for example aviation (Zambia Airways) perhaps Zambia may have had a much lower unemployment rate by now.

Unemployment the condition of willing workers lacking jobs or "gainful employment" has many causes, including globalization. In Zambia, government outsourcing of capital projects and unregulated imports of cheap products specifically undermine local enterprise efforts to ease unemployment in urban cities.
Before industrialization unemployment was not recognized as an issue in rural areas, despite the "disguised unemployment" of rural laborers having little to do, especially in conditions of poverty. In rural Zambia, seasonal farming is the only pre dominant occupation activity available.

In order to address high unemployment, the Zambian government needs to undertake systemic changes in
1. Economic policy

Structural unemployment is a result of the dynamic changes of a capitalist economy (such as technological changes and capital flight ) — and the fact that labor markets can never be as fluid as financial markets. Workers are "left behind" due to costs of training and moving, plus other inefficiencies in the labor markets. Government therefore, needs to streamline current economic policy to mitigate these effects and seal opportunities of vulnerability especially in negotiating conditions for the implementation of donor funded capital projects.

2. Trade regulation

Government needs to review bilateral trade arrangements and its tariffs. Policies that are simply meant to meet commodity demand will not work to reduce unemployment.

3. Vocational Training

Government needs to enhance national capacity to provide for new specialized training, to support willingness to switch into the available jobs and for those lacking the legal requirements of other professions.

4. Art and Craft

Government must support and promote arts and crafts for the rural population. There is a market for Zambian paintings and traditional crafts in the west. Government, through its missions abroad must identify these markets and link producers to the market.

1 comment:

chades said...

thanks for the staff but you have to provide mre