PRESIDENT HICHILEMA URGE WORLD BANK TO SUPPORT ZAMBIA IN AVOIDING ECONOMIC SHUTDOWN AMID CLIMATE CHALLENGES
President Hakainde Hichilema has called on the World Bank Group to take decisive action to help countries like Zambia avert economic shutdowns, particularly through the implementation of the Catastrophe Deferred Drawdown Option (Cat DDO). Speaking during a courtesy call by World Bank Regional Vice President for Southern and Eastern Africa, Victoria Kwakwa, President Hichilema stressed the urgent need for financial support to mitigate the impact of climate change on Zambia’s economy.
The Cat DDO, a contingent credit line providing immediate liquidity to countries after natural disasters, is viewed as crucial to Zambia’s economic stability as the country faces challenges linked to climate-induced droughts. President Hichilema explained that the government’s 2024 growth projection of 4.7% had been reduced to 2% due to the dual risks posed by energy shortages and food insecurity exacerbated by drought.
“Our growth projection was 4.7%, but climate change has forced us to talk about two percent plus. The drought has injected two national risks: energy and food,” said President Hichilema. He urged the World Bank to expedite the Cat DDO to address these challenges and ensure the availability of energy for irrigation to maintain food security and economic growth.
Secretary to the Treasury Felix Nkulukusa added that government is working with the World Bank on the National Energy Advancement and Transformational (NEAT) project, a $700 million initiative aimed at ensuring the sustainability of Zambia’s energy sector. The project, running from 2023 to 2033, will also attract private investment into ZESCO, with $100 million allocated for phase one and $25 million already disbursed.
Ms. Kwakwa confirmed that the Cat DDO will be tabled before the World Bank board by the end of the year, noting that Zambia needs to build resilience in energy, water management, and climate-smart agriculture. She also emphasized the importance of diversifying the energy sector and attracting private investment to stimulate growth and reduce poverty.
The meeting highlighted the collaborative efforts between Zambia and the World Bank to address climate challenges and drive economic recovery.