This country's tallest and fanciest high-rise office building has only one elevator that works. Its curious ups and downs symbolize a chronic economic decay in Zambia and across much of sub-Saharan Africa.
Office workers stand in long lines all day outside this mysterious elevator, which serves 23 floors. When their turn comes, they pack themselves into an elevator car where, without bothering to press any buttons, they commence shouting out floor numbers. As if by magic, the elevator goes up and down.
But it isn't magic. It's Zambia, a landlocked southern African country with an economy that has been imploding for a decade. And what they are shouting at -- in a nation filled with machines that don't work for lack of money to buy spare parts -- is not the elevator, but the elevator operator. They have to shout because he is standing on top of the elevator car, manipulating a jerry-rigged control gizmo that, with frequent breakdowns, keeps the elevator moving and prevents Zambia's most prestigious building from losing all its tenants.
The elevator car with the operator on its roof is perhaps the oddest manifestation of Zambia's disintegrating economy. What is less odd but far more important, however is that the country has almost no foreign exchange to import wheat for bread, to buy diesel fuel, to fix farm tractors (62 percent of which don't work), to upgrade factories (which operate at less than 32 percent of capacity), or to pay off an ever-growing foreign debt.
"What is happening is that Zambia is being strangled, and not so slowly anymore," said an International Monetary Fund official who is a specialist on Zambia.
The economies of many countries in sub-Saharan Africa have been contracting for more than a decade, with declining per-capita income and with population outstripping food production. But what is happening to Zambia, as well as to countries such as Tanzania and Sudan, is a crisis of a more disturbing order.
Simply put, Zambia has fallen so deep into an economic sinkhole that international lending agencies, major donors and local bankers say it is incapable of borrowing or producing its way out.
"Rescheduling our debts and borrowing more money will give us some breathing space, but it will merely put off the evil day," said Francis Nkhoma, general manager of Barclays Bank in Zambia. "Frankly, we cannot generate enough money to pay the debts and buy the imports that keep the country going."
Interest payments on Zambia's debt would eat up 40 percent of the country's export earnings, if Zambia met these payments -- which it does not. Debt service drains away 82 percent of new loans coming into the country.
In one day last week, newspapers here announced the closing of a tire factory for lack of foreign exchange to buy raw materials and the closing of a plastics plant for the same reason. The same day's papers announced the one-month closure of the nation's bakeries. Zambia is out of wheat, cannot afford to buy any more and must wait for an aid shipment from the United States.
In Nairobi, Kenya, recently, Edward Jaycox, vice president of the World Bank for eastern and southern Africa, described Zambia as one of a group of countries that has fallen into "a very, very difficult, perhaps impossible situation . . . . No matter how hard people try, they cannot get back on the growth path."
The debts of Zambia and other sub-Saharan countries are small by international standards. According to 1983 World Bank figures, Brazil alone owed more (about $80 billion) than the combined debts of 37 borrowers in sub-Saharan black Africa. Nor are Africa's debts threatening the survival of the international monetary system.
The debts, however, do threaten the survival of several anemic African economies that have been battered for years by mismanagement, declining prices for exports, international assistance that some specialists view as wrong-headed and, last year, by the worst drought of the century.
"Should we let our people starve so that we can pay our own debts?" asked Julius Nyerere, leader of Tanzania, earlier this year at a conference of bankers in London. "Africa's debt burden is intolerable. We cannot pay. You know it and all our other creditors know it."
Many African countries, including Zambia, have fallen in arrears on interest payments. By the end of 1983, the most recent year for which continent-wide figures are available, they were $9 billion behind. Zambia's external-payment arrears last year were $600 million, according to the World Bank.
Zambia's debt burden, in surpassing the capacity of the country's economy to pay it off, is forcing the World Bank and major donors to rethink the way they aid Africa. The World Bank's 1985 annual report, released this week, says the country's plight demands "special accommodations by Zambia's aid donors and creditors."
What this means, say donors in Lusaka, is that Zambia can survive only if donors are willing to continue to loan money and fund programs -- and to simply give Zambia hard currency and essential commodities such as fuel.
"Unless we attempt this transfusion, we won't have any patient to perform surgery on," said one World Bank official who monitors Zambia.
The grants of foreign exchange and commodities would be used to make Zambia solvent while its economy is rebuilt in accordance with an orthodox IMF program calling for sharp currency devaluation, price reform and dramatic reductions in the size of government.
For Zambia to weather the IMF's austerity program, Jaycox, the World Bank's senior official for eastern and southern Africa, said that it will need 15 years of import support before it can survive on its own. He said international agencies and donors are wasting their time giving Zambia aid "unless they are willing to stick it out for the 15-year haul."
Such a commitment would force donors to fork over cash rather than simply shipping surplus food or pushing development programs that promote consumption of a donor country's own products. For the Reagan administration, which has expressed its willingness to help African countries willing to make free-market reforms, Zambia's predicament, and that of other African countries, could prove unpalatably expensive.
About $200 million to $300 million a year of this "import support" grant money is needed for the next three to five years, officials say. The United States now gives Zambia about $35 million a year, most of it in fertilizer, food and equipment -- not cash.
"The U.S. government and Congress have not yet come to grips with their own rhetoric for African development," said one senior relief official in Lusaka.
The U. S. Agency for International Development has just launched a five-year, $500 million Economic Policy Reform Program to encourage African countries to move toward a free market economy to spur growth in their economies. Congress has appropriated the first $75 million and Mali has been chosen as the first recipient with a grant of $18 million.
Zambia is one of five countries earmarked to receive aid under this program but no funds have yet been allocated to it, an AID official said in Washington.
While Zambia itself is to blame for many of the economic problems that it is apparently incapable of solving, international lending agencies now admit that they, too, are to blame.
"What has happened in Zambia could have been avoided," said an IMF official. "It has taken special effort to run this country into the ground."
Zambia did not sink into penury because it lacks potential. Indeed, its natural resources far exceed those of many other African countries that are in much better financial shape. It has fertile land, good weather, abundant mineral wealth and a relatively stable government, led by President Kenneth Kaunda, who is among the most respected and trusted of African leaders.
No one is to blame for what started Zambia's decline. In 1975, the price of copper, on which Zambia had depended for 90 percent of its export earnings, collapsed. Before then, Zambia was among the fastest growing countries of Africa. Kaunda, who calls his governing philosophy "humanism," used copper earnings to subsidize food prices, education and health services. He nationalized major businesses, while overseeing the expansion of a bloated and inefficient bureaucracy.
When copper money stopped flowing, Kaunda's reaction -- as he admitted last year in a remarkably candid speech -- was "to carry on as before. Namely, keep importing and hope for the best."
The best, namely a recovery in copper prices, never came. Copper prices still are 60 percent lower than 10 years ago. What came to Zambia's rescue in the late 1970s, as Kaunda vowed to mend his country's profligate ways, was the IMF, the World Bank and a host of bilateral donors.
Since 1978, the IMF has committed $700 million that the Zambian government was supposed to use to ease the financial pain of "structural adjustments" that would revivify agriculture, wean the economy from its dependence on copper and shrink the inefficient bureaucracy. During that time, Kaunda did agree to a number of politically difficult reforms, including an end to most food subsidies.
But, in hindsight, both the IMF and World Bank now acknowledge that they were too optimistic and did not demand enough change in return for their millions.
"It must be admitted that both the acuteness and duration of the decline in copper prices were grossly underestimated by all parties," said the World Bank, in a report released this week. "As a result, the scope and character of the policy and institutional reforms that were set in motion were never commensurate with the gravity of the crisis."
IMF officials familiar with Zambia echo this assessment.
"It is fair to say that what we have done is to allow Zambia to maintain a standard of living for its civil servants whose payroll amounts to 20 percent of the country's gross domestic product which is totally out of synch with the rest of the economy," said one IMF staffer. "We allowed Zambia to delay the inevitable adjustment."
An IMF team is due here in Lusaka in November and it is not expected to renew loan payments unless Zambia agrees to a drastic currency devaluation -- as much as 70 percent. About $100 million of desperately needed U.S. and World Bank aid is contingent on Zambia's acceptance of the IMF's demands