Republic of Zambia
Ministry of Finance & National Planning
ZAMBIA, IMF REACH STAFF-LEVEL AGREEMENT ON FIRST REVIEW OF THE EXTENDEDCREDIT FACILITY PROGRAMME
Lusaka, April 6th April 2023 – Following the first review mission for the Extended Credit Facility (ECF) Programme, Zambia and the IMF staff have reached a Staff-Level Agreement (SLA) on economic and financial policies that will anchor programme implementation for the next 12 months. The SLA is subject to approval by IMF Management and the Executive Board once the necessary financing assurances have been received. Approval by the IMF Executive Board will trigger the second disbursement.
The agreement follows a visit to Lusaka from 22nd March to 5th April, 2023 by an IMF mission team for Zambia led by Ms. Allison Holland, Mission Chief for Zambia. The IMF has commended Zambia for succesfully implementing a number of home-grown reforms to reduce the fiscal deficit and increase social spending in 2022, alongside steps to strengthen public financial management and good governance.
The IMF Programme provides the much-needed support for Government to achieve fiscal and debt sustainability, reduce poverty, and lay a solid foundation for inclusive and sustainable growth. The SLA marks an important step in Zambia’s cooperation with the IMF and the country’s journey towards economic recovery.
Speaking on the IMF announcement, Minister of Finance and National Planning, Dr. Situmbeko Musokotwane, MP, said:
“The Zambia today and the Zambia of two years ago are two different countries. We have taken control of our finances and implemented crucial reforms to reign in borrowing and ensure prudent use of resources and oversight in public spending. We are pleased to see that our partners recognise the progress we have made in reinvigorating the Zambian economy. Zambia has played its part, but before we can reap the benefits of this successful review, we need to see progress on our debt restructuring. We remain optimistic that working with the Official Creditor Committee (OCC) and other creditors, we shall soon reach an agreement on debt restructuring. This will help us achieve economic recovery and attain sustainable growth.”
“We are grateful to the IMF and all our creditors for their continued support. We will continue to work together to ensure that a debt restructuring deal for Zambia can be achieved as swiftly as possible. It is essential that we continue to access IMF funding to anchor our reform agenda and invest in development. It is in everybody’s interest that Zambia succeeds.” he added.
Issued by:
(Original Signed)
Secretary to the Treasury
MINISTRY OF FINANCE AND NATIONAL PLANNING
ADDRESS: P.O. Box 50062, Chimanga Road, Lusaka: TEL: +260-211-53512/253786/252121/250544 TWITTER: @MOFNPZambia, EMAIL: treasurybriefs@mof.gov.zm, WEBSITE: www.mof.gov.zm
FACEBOOK: http://m.facebook.com/zambiafinanceministry
REFERENCE NOTES:
1. The IMF approved an ECF programme for Zambia in August 2022. As part of the programme, the IMF carries out scheduled regular reviews, assessing performance in areas including restoration of fiscal and debt sustainability; improving debt management and transparency; and strengthening governance and financial stability.
2. Key Reforms Include:
i) Elimination of subsidies on fuel by making pump prices cost reflective;
ii) Boosting revenue collection and improvements in revenue administration;
iii) Publication of the action plan for the full migration of the Farmer Input Support
Programme (FISP) to a more efficient electronic agricultural input support system;
iv) Adoption of the findings of the cost of service study for electricity;
v) Strengthening oversight in debt management through the enactment of the Public Debt Management Act; and,
vi) Enhancing the operational independence of the Bank of Zambia through the enactment of the Bank of Zambia Act.
ADDRESS: P.O. Box 50062, Chimanga Road, Lusaka: TEL: +260-211-53512/253786/252121/250544 TWITTER: @MOFNPZambia, EMAIL: treasurybriefs@mof.gov.zm, WEBSITE: www.mof.gov.zm
FACEBOOK: http://m.facebook.com/zambiafinanceministry
