Zambia has secured a staff-level agreement with the International Monetary Fund (IMF) on a new 36-month Extended Credit Facility valued at $1.47 billion, signaling international confidence in the Southern African nation’s economic recovery trajectory. The multi-billion-dollar arrangement remains subject to formal approval by the IMF Executive Board.
The breakthrough follows an intense 11-day IMF mission to Lusaka led by Mission Chief Edward Gemayel. During the bilateral engagements, the Fund’s delegation conducted high-level consultations with President Hakainde Hichilema, Finance Minister Situmbeko Musokotwane, and Bank of Zambia Governor Denny Kalyalya to review macroeconomic metrics and construct the new three-year financial framework.
Designed to provide structural balance of payments and budget support, the framework anchors Zambia’s broader economic stabilization agenda. The initiative seeks to safeguard long-term debt sustainability while unlocking catalytic capital for private-sector-led expansion.
The IMF highlighted that Zambia enters this successor program from a position of renewed macroeconomic strength, driven by the successful execution of its previous reform cycle. National output is projected to expand by 5.6% in 2026, bolstered by strong rebounds in agriculture, mining output, and key export sectors. Headline inflation has steadily decelerated to 6.1%, settling firmly within the central bank’s target band, while gross international reserves strengthened to $6.1 billion as of September.
“Zambia enters the program from a position of strength following the successful completion of its previous IMF program,” said IMF Mission Chief Edward Gemayel, commending the administration’s fiscal discipline. “The Fund looks forward to continuing its close partnership with Zambia in support of macroeconomic stability, debt sustainability, and inclusive growth.”
Despite the positive growth trajectory, Fund officials highlighted fiscal slippages over the past year, noting that public revenue collections lagged original forecasts alongside heightened expenditure pressures. However, the IMF welcomed prompt policy corrections instituted by the government to align the fiscal trajectory ahead of board review.
Beginning in 2027, program conditionality will pivot heavily toward expanding the domestic tax base, streamlining tax administration, and tightening public debt oversight,all while ring-fencing key social safety nets. Aligned with the government’s flagship ‘Grow Zambia Agenda’, structural reforms will center on job creation, strengthening anti-corruption bodies, enhancing institutional governance, and increasing transparency across mining license issuance.
