Friday, March 1, 2024

Finance Minister Appeals to European Union to help Zambia get the $1.4 billion IMF bailout

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Minister of Finance and National Planning Situmbeko Musokotwane has appealed to the European Union to support Zambia’s quest to access the Extended Credit Facility (ECF) for 2022-2025 to help restore macroeconomic stability and spur economic recovery.

Dr Musokotwane said the EU has a critical voice on the IMF Board which is cardinal to helping Zambia access the US$1.4 billion bailout package announced in December 2021.

The Minister said the staff-level agreement Zambia reached with the IMF is enabling the country to engage its creditors to restructure its debt.

Dr Musokotwane said the government wants to restructure payments with Zambia’s creditors under an arrangement that will allow the country to continue with debt servicing that will not undermine and affect economic activity in the country.

“As our case goes to the IMF and World Bank, please I appeal to you to give Zambia that it requires,” said Dr Musokotwane.

The Minister of Finance made the appeal to eight EU Ambassadors represented during the launch of the Multi-annual Indicative Programme (MIP) in Lusaka, namely the Czech Republic, Finland, France, Germany, Ireland, Italy and Sweden.

ZANIS reports that the Multi-annual Indicative Programme is a framework and road map that will guide and shape development cooperation between the European Union and Zambia over a seven-year period from 2021 to 2027, with a mid-term review scheduled for 2024.

The MIP sets out strategic priorities for the EU-Zambia partnership bordering on EU’s interests and values and Zambia’s development priorities under the 7NDP.

Dr Musokotwane assured the EU Ambassadors that Zambia is making the necessary reforms required to restructure and nationalize the debt and bring investments to the country.

The Minister of Finance said its cardinal that Zambia resolves her economic indebtedness brought about by excessive borrowing over the past few years.

He explained that the over-borrowing has made it difficult for the government to invest in socio-economic sectors such as employing teachers, health workers and creating jobs amidst the rampant closure of companies.

“Very soon, we shall be engaging the people we owe so that we have to agree how to restructure this debt. Hopefully, we should be done with that by May, so far it looks promising. The next step will be to approach the IMF Board during our mid-term review,” said Dr Musokotwane.

Dr Situmbeko praised the European Union for continuing to be one of Zambia’s largest donors.

The Minister of Finance noted that the EU has financed many development projects in various key sectors of the economy ranging from rehabilitation of the valuable Kariba Dam, construction of roads across the country, improvement and supply of piped water to some communities and technical assistance to the implementation of electoral reforms.

Dr Musokotwane however appealed to the EU to assist Zambia create jobs for the majority of the country’s youths who are unable to find employment after coming out of schools, colleges and universities despite possessing an array of valuable and desirable skills.

He noted that the labour market is being flooded annually with about 400,000 job seekers and warned that failing to create jobs for youths will make them lose faith in democracy and social order.

“There is a serious problem in the country, a serious problem of jobs especially for the young people …we don’t have the time…otherwise the issue of creating jobs is paramount, whether we are talking about the 8NDP or areas of cooperation” said Dr. Musokotwane

Dr. Musokotwane said creating jobs in Zambia and the rest of Africa will help stem the tide of economic refugees entering Europe to seek a better life.

He said investors should be able to find human capital in Zambia for their investments to pay off rather than resorting to hiring foreign labour.

The Minister of Finance expressed optimism that the objectives of the Multi-annual Indicative Programme and the country’s 8NDP will help bring out fruitful socio-economic benefits from the partnership between the EU and Zambia.

Dr Musokotwane said he looks forward to the EU’s impeccable track record of development cooperation being enhanced through the seven year Multi-annual Indicative Programme.

The Minister also thanked the EU for its continued support to Zambia’s COVID-19 national response

Speaking at the same function, EU Ambassador to Zambia and COMESA Jacek Jankowski said the EU has earmarked 299 million Euros to finance the Multi-annual Indicative Programme for Zambia.

Ambassador Jankowski said the MIP has been designed to respond faster to the development needs of Zambia and will be anchored on a green economy for sustainable growth, human capital development and governance.

“The MIP marks a new chapter in a long and fruitful partnership between Zambia, the EU and its member states. Building on our long history of technical cooperation and through a comprehensive EU-Zambia political dialogue, our relation has evolved beyond the traditional donor-recipient dynamic towards a partnership of equals,” said Mr Jankowski.

Ambassador Jankowski said the EU will leverage its expertise and resources to accelerate Zambia’s social and economic development and strengthen the country’s stability.

He said the EU will strive to build on past development cooperation and venture into new territories of cooperation and support.

Ambassador Jankowski said the EU will also help mobilize the private sector to play a critical role in development aid and scale up private investments towards Zambia’s national development priorities and sustainable development goals.

He said a mid-term review of the MIP will be held in 2024 to assess the impact of the joint development initiatives aimed at harnessing the demographic dividend of Zambians.

Mr Jankowski commended government’s commitment to reforming the country as demonstrated by the attainment of the staff level agreement with the IMF as well as the launch of the Economic Recovery Programme of 2020 to 2023.

27 COMMENTS

  1. This just shows Musokotwane is an amateur, the matter is outside his depths. Only NOW he grasps what the conditions that the IMF has attached to the $1.4billion loan actually mean for Zambians. And now he begs his friends in Europe to bend the rules within IMF. That surely won’t happen, they are NOT going to give away $1.4billion without any conditions. What a disaster this minister is, he is even worse than his PF pre-decessors!

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  2. We told you so! IMF & Co are not your friends. Europe is on the brink of war, economies almost entering the worst recesion in history and you have the guts to beg? These chaps are the worst of the bunch because you never learn.

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  3. So sad! And i bet those pronouncements of employing the more than 40 thousand in civil service were premised on the hopes of clinching this same ECF with the IMF. Our leaders should start looking at finding and employing local solutions, rather than banking on the goodwill of International lenders. It’s rather embarrasing to hear our leaders sounding like they’re begging.

  4. I thought this deal was done.But it looks like
    Certain conditions have not been met.Bally
    Even went to say we managed to get IMF
    Loan which previous government failed.Mr
    Musokotwane can you tell Zambians where
    We are stuck?

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  5. So sad! And i bet those pronouncements of employing the more than 40 thousand in civil service were premised on the hopes of clinching this same ECF with the IMF. Our leaders would do well by looking at finding and employing local solutions, rather than banking on the goodwill of International lenders. It’s rather embarrasing to hear our leaders sounding like they’re begging.

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  6. Whats this, I thought this was a done deal…so when you were voting against Russia didnt you not leverage with this deal to the so called EU who are on the IMF board? Another reason why I said we should have abstained, we dont have a dog in this race.

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  7. Do you remember Luswambo asking IMF to avail the conditions to the Zambian people and how he was mocked at it?

    The terms and conditions therein are so inhuman.

    Like a fly that enters your mouth, you desperately fight to spit it out. It’s what Hon. Musokotwane is currently feeling about IMF. Let’s wait and see! He is lucky that fly didn’t clog his vision for our sound economy.

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  8. We all thought this deal was done, guess they mislead us. Next time before making pronouncements make sure you have the deal penned down. Begging won’t help, find plan B if the IMF deal yakana or else you will look like not knowing what you are doing.

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  9. Kikikikiki here we go…so IMF conditions are terrible….Spaka and Tarino Orange Please talk to IMF so they give Zambia kaloba without any conditions…..hihihihihi….a begger is not a chooser…IMF now dangling a carrot….but we have abundant natural resources worth trillions

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  10. I have laughed. This government is cursed with mediocrity. They have no idea what they are doing. We warned them about IMF but as you know hh thinks so highly of the west such that he shunned and demonized our partners in the east. The west in last decade or so have made it clear that their priorities is not to help Africans. Meanwhile hh still thinks they care about him just because he promised gay rights

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  11. Minister beg for half of that amount….our mines, the private sector etc can easily raise 500bn$ for budget support let the othr 500 you beg from imf go to purly investment support that will service their ‘loan’

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  12. Lets just forget about the IMF we can still look to china investment bank to secure a loan without any conditions attached…imf is not an international lending institution its an american institution and we know that America has been involved in high level state banditry iraq libya Afghanistan syria and the endless list goes on..now these yankees are stealing other countries reserves as long there are in dollars. Open your eyes you…now you are embarrassing yourself should we call you a gaffe??

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  13. @ tarino you are right…this just shows how these guys will use you and dump you after theirs is achieved…its really laughable..we should try and slide away from the western influence and look to the emerging powers like china and india..save part of our reserves in yuan.

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  14. Dr Musokotwane however appealed to the EU to assist Zambia create jobs for the majority of the country’s youths who are unable to find employment after coming out of schools, colleges and universities despite possessing an array of valuable and desirable skills…..SO WE WERE BANKING ON FOREIGNERS TO DELIVER THOSE MUCH TALKED ABOUT JOBS?

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  15. They can’r even employ a single teacher.They were told not to do so.He was over promising.You think IMF yabana

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  16. The EU has no impeccable record. Just a bunch of losers siphoning wealth off of their erstwhile colonies, especially with unimaginative strategists like we have currently. There MUST be a way out without IMF.

  17. What bailout? Remember the Windfall Tax. Instead, they chose to go with putting the nation into debt. If borrowing money at interest instead of collecting taxes isn’t fraud, I don’t know what it.

  18. @Moto it was listed as one of the UPND’s invisible achievements since getting into office. below the opening of a car park at Mass Media Complex

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