Musokotwane Appeals To EU To Help Secure IMF Bailout

Finance Minister Situmbeko Musokotwane has asked the European Union (EU) to support Zambia’s request for an extended credit facility from the International Monetary Fund. The $1.4 billion bailout package was announced in December and is seen as vital in helping to restore Zambia’s macroeconomic stability and kickstart the country’s economic recovery.

Speaking to EU ambassadors in Lusaka, Dr Musokotwane said the bloc played a critical role on the IMF’s Board, which would influence what kind of assistance Zambia would receive.

“As our case goes to the IMF and World Bank,” he said, “please I appeal to you to give Zambia what it requires”. 

The finance minister went on to explain that his government is seeking to restructure its payments to Zambia’s creditors under an arrangement that will allow the country to continue debt servicing without undermining economic activity. He said the staff-level agreement, which Zambia reached with the IMF in February, was already helpful in enabling the country to engage with creditors and restructure its debts. 

The comments came during the launch of the Multi-annual Indiciative Programme (MIP) on Tuesday, which was attended by representatives from the Czech Republic, Finland, France, Germany, Ireland, Italy and Sweden. 

The MIP is intended to serve as a roadmap which will guide and shape development cooperation between the EU and Zambia over the period from 2021 to 2027. 

Mr Musokotwane told representatives that the government was already hard at work, making the necessary reforms to restructure Zambia’s debts and attract investment following the excessive borrowing of the previous Patriotic Front government. 

“Very soon, we shall be engaging the people we owe so that we have to agree how to restructure this debt. Hopefully, we should be done with that by May, so far it looks promising. The next step will be to approach the IMF Board during our mid-term review,” he explained.