Reserves Worth $10 Billion Less Than Country’s Debt

The Bank of Zambia (BoZ) has confirmed that their reserves are worth over $10 billion less than what the country owes in debt.

BoZ governor Christopher Mvunga has said that President Hakainde Hichilema’s comment that he had inherited an “empty treasury” was provided in the context that the country has far less money compared to what is needed to service debt owed.

Speaking at a policy briefing on Wednesday, Mvunga has said that the country’s held $2.9 billion in reserves compared to a debt worth in excess of $13 billion.

“The Head of State said that the Treasury was empty…so, yes, we can talk about the reserves at $2.9 billion against a potential outlay of about $13 billion to pay your debt…the Head of State is making that pronouncement that I owe more than what I have,” Mvunga said.

The BoZ governor also confirmed that inflation was projected to decelerate faster than earlier anticipated, however it would remain above it’s 6-8% target range due to unprecedented inflation caused as a result of previous Patriotic Front (PF) governance.

“Inflation is now projected to average 22.6%, 15.5% and 11.9% in 2021, 2022 and the first half of 2023 respectively,” Mvunga clarified.

Comparatively, under the previous PF government inflation jumped to an 18 year high, with consumer prices rising to 23.2% from in just one year from 2019 to 2020. When the PF government first came to power, inflation sat at just over 8.5%.