IMF again rejects Zambia’s economic bailout plan
By Staff Reporter
The International Monetary Fund (IMF) has rejected Zambia’s latest borrowing plan, describing them it as a risk that would make it harder for the country to sustain its debt load.
The last two and half years, Zambia has been negotiating for a $1.3 billion economic aid package.
The government had expected the agreement to have been reached by early this year after it was put on hold end of last year.
This is the third time the IMF has rejected government’s proposal.
The IMF first turned down government’s borrowing plan in August last year, fearing that it threatened the country’s debt sustainability.
And when the Bretton Woods institution suspended discussions again in December, it asked the government to redo the bail out plan.
And the Fund released a statement on Friday, saying the country was still not ready for the package.
“…However, the latest borrowing plans provided by the authorities continue to compromise the country’s debt sustainability and risk undermining its macroeconomic stability and, ultimately, living standards of its people,” read the statement in part.
“Against this background, any future programme discussions can only take place once the Zambian authorities implement credible measures that ensure debt contraction is consistent with a key programme objective of stabilising debt dynamics and putting them on a declining trend in the medium term.”
The IMF has however pledged to continue engaging the Zambian government through regular discussions and technical assistance.
