The International Monetary Fund (IMF) has approved a US$1.3 billion (£1.1bn) loan to Zambia. It said it would help Zambia restore economic stability and foster higher and more inclusive growth.
In 2020, as the COVID-19 pandemic battered Africa, Zambia became the first country on the continent to default on its foreign debt – estimated at US$17.3 billion.
The fund said Zambia was dealing with years of economic mismanagement and its growth rates were too low to tackle poverty, inequality and malnutrition.
“A substantial strengthening of fiscal controls is needed to support the fiscal adjustment, as well as address governance and corruption vulnerabilities,” said IMF managing director Kristalina Georgieva.
The IMF statement said Zambia’s economic growth “has been too low to reduce rates of poverty, inequality, and malnutrition that are amongst the highest in the world.”
In return Zambia will have to tackle corruption, eliminate fuel subsidies and make agricultural subsidies more efficient.
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