ZAMBIA FURNISHES IMF ON ECONOMIC BAILOUT

BUUMBA CHIMBULU writes

@SunZambian

GOVERNMENT has provided all the necessary data to the International Monetary Fund (IMF) for the assessment on an economic bailout, minister of finance, Margaret Mwanakatwe has said.

Ms Mwanakatwe said this process culminated in Government and the IMF reaching agreement on data accuracy.

Government and other stakeholders held consultations with an IMF mission led by Mary Goodman from April 16 to 30  in line with Article IV.

Ms Mwanakatwe said the IMF team would prepare a report of the Article IV Consultation which would be discussed by its executive board in the coming months.

She said this in a statement obtained by the Sun yesterday.

She said Government and the IMF agreed on a number of areas that required an immediate policy response, especially with respect to frontloading of fiscal adjustment, reducing debt accumulation, addressing the challenge of domestic arrears, and enhancing external buffers.

“We also agreed that there is need to protect expenditure towards the social sectors. It is our shared vision that accelerating implementation of such reforms is the surest way to re-energise our efforts aimed at improving the livelihoods of the Zambian people,” she said.

Meanwhile, Ms Mwanakatwe said Government had put in place measures which would ensure a quick return to a path of sustainable growth, fiscal consolidation, debt sustainability and build-up of external reserves.

The IMF mission during its recent visit said Zambia’s growth was projected to slow to 2.3 percent in 2019 from 3.7 percent in 2018, lower than earlier envisages due to the impact of the drought on agricultural production.

But Ms Mwanakatwe said Government was aware of the challenges facing the Zambian economy.

 “This is a key first step towards undertaking corrective measures. We will therefore, undertake all necessary measures to redeem the situation,” said Ms Mwanakatwe.

She said measures to keep the deficit within the 2019 budget target, as well as the medium term, would be undertaken.

In this regard, she said, control measures around debt accumulation and halting arrears build up would be implemented expeditiously.

Government’s fiscal deficit for 2019 was at 7.5 percent, external debt stock US$10.05 billion, the domestic debt K58 billion, guarantees at US $1.2 billion, and domestic arrears at K15.6 billion.