AfDB APPROVES $108 MILLION LOAN TO ZAMBIA FOR ECONOMIC REFORMS AND AGRICULTURE DEVELOPMENT

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AfDB APPROVES $108 MILLION LOAN TO ZAMBIA FOR ECONOMIC REFORMS AND AGRICULTURE DEVELOPMENT

The African Development Bank (AfDB) Group has approved a $108 million loan to Zambia to bolster economic governance and drive reforms across critical public sectors. The funding aims to support the Fiscal Sustainability and Economic Resilience Support Programme, designed to build a resilient and diversified economy.



In a statement issued Thursday, AfDB Country Manager for Zambia, Raubil Durowoju, described the loan as part of a multi-sectoral initiative designed to build a resilient and diversified economy. The funds will support the Fiscal Sustainability and Economic Resilience Support Programme, a cornerstone of Zambia’s economic reform agenda.



Key objectives of the programme include boosting domestic revenue generation through measures such as introducing an electronic “smart invoice” system, registering 12,000 VAT-liable taxpayers, and strengthening Zambia’s participation in the Global Forum on Transparency and Exchange of Information for Tax Purposes.



A significant portion of the funding is earmarked for the agricultural sector. This includes supporting the Ministry of Agriculture’s mechanization strategy by establishing ten mechanization centers to provide rental equipment to farmers lacking access to machinery. The goal is to enhance agricultural productivity and reduce reliance on the mining sector by enabling farmers to supply both domestic and international markets.


Additionally, 257 million kwacha (approximately $9.4 million) will be allocated for the 2023-2024 agricultural season to support sustainable agriculture. The private sector will manage this market-driven initiative, offering small and medium-sized farmers customized financing for agricultural inputs, addressing their limited access to affordable credit.



The programme also aims to improve the efficiency and transparency of public spending by strengthening Zambia’s public investment management strategy.

This approval is part of AfDB’s broader commitment to Zambia, which, as of November 30, 2024, included an active portfolio of 24 projects valued at $872.3 million.



“This facility represents a significant step toward achieving fiscal stability and advancing private sector participation in Zambia’s economic development,” said Durowoju.

The loan is expected to play a transformative role in Zambia’s economic diversification efforts, driving growth and resilience across critical sectors.

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