THE International Monetary Fund (IMF) is ready to pursue and agree with the Zambian government on the monetary aid package that will help the country’s economic recovery programme, newly-appointed resident representative to Zambia Alfredo Baldini has said.
In response to a press query yesterday, Mr Baldini said: “The IMF and the Zambian authorities have been in talks about a possible IMF-supported programme… IMF staff stands ready to pursue these issues with the new government that will be formed after the inauguration.”
On what conditionalities are likely to be attached to the impending bail-out, Mr Baldini said the two parties are still discussing on the financial aid category and terms.
“At this stage, however, there have been no formal negotiations on the type of arrangement or potential size of financial support,” Mr Baldini noted.
Nevertheless, sources at Ministry of Finance have indicated that Zambia will be availed a financial aid package of between US$1.2 billion and US$ 1.5 billion, with conditions that electricity and fuel subsidies should be removed and that fiscal policy should be tightened to avoid unnecessary public expenditures, among other things.
Recently, President Lungu also told the business community that Government and IMF have made great progress and reached broad consensus on key areas of the Bretton woods programme whose components will be agreed upon.
President Lungu hinted of rapid but progressive migration to a cost-reflective tariff structure in the electricity and fuel sub-sectors, restructuring in agricultural subsidies, broad policy measures to accelerate economic growth and controlled spending during his next five years tenure.
President Lungu was re-elected in the August 11, 2016 general elections and will be sworn in on September 13.