The Zambian economy is expected to grow by just 2.7% in 2023 from 4.7% in 2022, as contractions in mining and energy drag on growth, a budget plan released by the ministry of finance showed on Sunday.
Zambia has concluded a long-delayed debt restructuring plan with the International Monetary Fund (IMF) after being the first African nation to default on its sovereign debt in 2020.
This is expected to save the southern African country $7.65 billion by 2026, the IMF said in a report.
The budget plan envisages the Zambian economy growing by 4.8% in 2024, 4.3% in 2025 and 5.0% in 2026 based on improvements in macroeconomic conditions and the implementation of reforms.
Secretary to the Treasury Felix Nkulukusa said there was growing confidence in Zambia as the country worked to restore fiscal sustainability.
The country’s overseas debt had reached $20.9 billion at the end of 2022. Budget figures show debt service payments of 117.4 billion kwacha ($6.24 billion) or 16.5% of GDP over the medium term.
Zambia and the IMF have completed the first review of the country’s $1.3 billion extended fund facility (EFF) programme.
The IMF’s executive board approved an immediate disbursement of $189 million to Zambia late last week.
In addition, the country is looking to sign a memorandum of understanding to restructure additional debt with private creditors, by the conclusion of the IMF’s second review later this year.
Production of copper, one of Zambia’s largest export commodities, is expected to drop to 682,431 tonnes in 2023 from 763,550 tonnes in 2022, the budget document showed.
