Announcing the arrival of an IMF staff team from Washington D.C, Secretary to the Treasury Fredson Yamba revealed that cabinet has made a decision to pursue an IMF supported program within 2016.
This is however the first time that Government is openly admitting that it is engaging the IMF for an economic program after many months of denial.
The statement from Mr Yamba issued today does not conspicuously state when the cabinet decision to pursue an IMF program was made because all along was adamantly saying that it was not considering any IMF program but merely engaging the IMF for consultations.
According to the IMF, an IMF economic program is a set of agreed terms which countries sign up to before accessing financing from the institution mainly to cushion economic challenges.
Mr Yamba disclosed that the IMF team will be coming to Zambia from 9th to 18 March, 2016 to assist the Zambian government in reviewing the current macroeconomic situation and providing advice on addressing the macroeconomic challenges facing the country.
Speaking ahead of the IMF Mission next week, Mission Chief Tsidi Tsikita said the IMF welcomes the continued engagement with Zambian authorities and stands ready to assist in any way it can, adding that, “the forthcoming mission from 9th to 18 March, 2016, which was scheduled earlier, would assist the authorities in reviewing the current macroeconomic situation.” We will also provide advice on addressing the macroeconomic challenges facing the country,” said Mr. Tsikita.
And commenting on the matter, Secretary to the Treasury Fredson Yamba affirmed that the forthcoming mission is a continuation of the IMF engagement with Zambian authorities, adding that, “this is against a backdrop of macroeconomic challenges and cabinet’s decision that the government engages the IMF on an economic program in 2016.”
“During the mission, the IMF team will not only hear our objectives for the anticipated program, but also its timing, and our submissions on some of the proposed key elements in the program,” said Mr. Yamba.
In his confirmation of the mission, Mr. Tsikita outlined the specific objectives of the mission. These being, together with the Zambian authorities, to develop a shared understanding of the current economic situation, the near-term outlook, and the scale of adjustments needed to stabilize the economy.
The team will also hear from the Government their policy intentions for the rest of 2016, including the objectives and timing of a possible IMF-supported program, taking into account practical and political constraints.
The mission team will also prepare the ground for subsequent program negotiations by discussing key elements of a possible program, IMF arrangement/facility options in light of Zambia’s current circumstances, and Zambia’s commitment and capacity to implement an IMF-supported program.