LUSAKA – Zambia is set to receive a significant financial boost from the International Monetary Fund (IMF) as it moves forward with its economic reforms. The country secured a staff-level agreement (SLA) with the IMF that can unlock a $184 million tranche under the Extended Credit Facility (ECF) program after the second review. The development, announced today by the Finance Ministry, is subject to final approval by the IMF Executive Board.
The incoming funds are part of a $1.4 billion ECF program launched in August 2022, designed to enhance macroeconomic stability and debt sustainability in Zambia. The program underlines the country’s commitment to fiscal discipline, better revenue collection and financial governance reforms that are essential for funding critical sectors such as health care and education.
Finance Minister Dr. Situmbeko Musokotwane stressed that the IMF program is critical to poverty reduction and setting the foundation for inclusive economic growth. The agreement reflects Zambia’s determination to revitalize its economy while ensuring debt sustainability and supporting vulnerable populations within an inclusive growth framework.
The ECF program has set objectives of financial reform, poverty alleviation, corruption mitigation and close creditor consultation to align debt restructuring with IMF standards. This latest milestone follows an initial review in April 2023, which released $188 million in support of Zambia’s reform-driven journey.
Treasury Secretary Felix Nkulukusa commended the IMF’s support for Zambia’s restructuring efforts aimed at promoting the Sustainable Development Goals. The SLA aims to consolidate economic reforms underway over the past year, including measures to increase revenue collection and enforce fiscal discipline.
The expected financial injection from the IMF is expected to advance these efforts, marking an important step towards achieving Zambia’s economic goals and enhancing investor confidence in the country’s reform agenda.
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