Zambia and IMF staff agreed a new 36-month credit programme proposing about 1.472 billion dollars of financing. Executive Board approval and prior actions remain outstanding. The agreement addresses tax-revenue shortfalls and excess agricultural spending while seeking to prevent new payment arrears. Its fiscal measures sit alongside the IMF’s forecast of stronger economic growth this year.
Zambia and staff of the International Monetary Fund, the multilateral lender known as the IMF, reached agreement on a new 36-month Extended Credit Facility programme.[1], [2]
The IMF proposed access of 1.076 billion special drawing rights, equivalent to approximately 1.472 billion dollars. Executive Board approval and completion of prior actions are required before the arrangement takes effect. The October 9 announcement is a staff-level agreement.[1]
The IMF says weaker value-added tax collections and lower fuel taxes left revenue below expectations. Spending above budget by the Food Reserve Agency also weakened public finances. The proposed programme includes reversing fuel-tax relief, reducing non-priority capital spending and preventing new payment arrears. It calls for closer monitoring of domestic payment obligations and accumulated VAT refunds.[1]
From 2027, gradual fiscal consolidation would aim for a primary surplus of 3 per cent of gross domestic product by 2029. The IMF proposes better tax compliance and narrower exemptions, alongside stronger oversight of state-owned enterprises, public-private partnerships and the Food Reserve Agency. Exchange-rate flexibility and reserve accumulation also form part of the policy framework.[1]
For Zambia, the IMF forecasts growth of 5.6 per cent this year, supported by agriculture, mining and exports. It puts September inflation at 6.1 per cent, within the Bank of Zambia’s target range, and gross international reserves at 6.1 billion dollars. Those economic indicators accompany the fiscal measures negotiated between September 29 and October 9.[1]
