Zambia seeks a 12-month extension of the IMF lending program
The Zambian government announced in a cabinet statement on Wednesday that it intends to extend the International Monetary Fund program for an additional 12 months after it now expires at the end of October.
With assistance from the IMF, the copper-rich country in Southern Africa has been working to improve its public finances after accruing a substantial debt load.
The initial $1.3 billion for its 38-month Extended Credit Facility was authorized in August 2022, but it was later raised to $1.7 billion. To date, around $1.55 billion has been distributed.
According to the cabinet statement, Situmbeko Musokotwane, the finance minister, was authorized to request the 12-month extension from the IMF.
According to the statement, “the objective is to consolidate the gains achieved during the programme period into 2026” and be supportive of economic reforms.
When contacted by Reuters, a representative for the finance ministry refused to provide further details.
Zambia fought its way to a restructuring agreement with its main creditors last year, but after years of excessive spending, it defaulted on its external debt in 2020. It continues to negotiate restructuring terms with Afreximbank and other minor creditors.
The fifth program review was completed last week, and the IMF board authorized a $184 million payout to Zambia.
