Zambian President Edgar Lungu faces a third election showdown with opposition leader Hakainde Hichilema on Thursday, in a vote that looks too tight to call and with mounting debt and a flagging economy taking centre stage.
In November, Africa’s No. 2 copper producer became the first African state to default on part of its debt during the coronavirus pandemic.
It will be among the continent’s slowest growing economies this year, the International Monetary Fund (IMF) estimates.
In office since 2015, 64-year-old Lungu narrowly defeated Hichilema, the CEO of an accountancy firm before entering politics, in a disputed election the following year.
The President has touted the new road, airport and energy projects he has overseen as laying the groundwork for economic development and growth.
His push for greater state control over the mining sector -an approach that has sparked fears of resource nationalism among international investors – will create jobs, he says.
“The challenge we have is the economy and we are doing our best to ensure that the challenge is faced head on,” Lungu said during his final virtual campaign rally on Wednesday.
But so far his debt-financed infrastructure splurge has failed to pay economic dividends, and unemployment remains high.
That has left him open to attack from Hichilema.
“So much money was borrowed at a very high cost and this is frustrating development efforts,” Hichilema, popularly known as HH, told a news conference on Wednesday.
Zambia owes in excess of $12 billion to external creditors and spends 30%-40% of its revenues on interest payments on its debt, credit rating firm S&P Global estimates.
“We need a leadership that can put in place some planning to rebuild the economy,” Hichilema said.
In the absence of credible opinion polls, analysts say Hichilema’s economic pitch, which has bolstered his support among the young, frustrated and jobless voters, could be the deciding factor in the vote.
Talks over an IMF aid package, already broadly agreed, are on hold until after the vote. So too is debt restructuring seen as an early test of a new global plan to ease poor countries’debt burdens.
“Investors may see a potentially clearer path to an IMF programme and a debt restructuring under HH,” Christian Libralato, emerging markets portfolio manager at Blue Bay Asset Management, which holds Zambia’s defaulted bonds.
Zambia’s electoral commission said it expects to declare the winner within 72 hours of polling stations closing.
