• Government should consider wooing investors in sectors that have high returns.
• There is need for Government to consider the manufacturing and Agriculture sectors as they have the capacity to grow the economy.
• Action Aid is expectant that the visit by IMF Managing Director will yield positive results.
ActionAid Zambia has advised Government to consider wooing investors in sectors that have high returns apart from Energy and Mining.
Organisation Interim Country Director Musonda Kabinga said there is need for Government to consider the manufacturing and Agriculture sectors as they have the capacity to grow the economy to the expected margins than the manner they are currently performing.
Meanwhile, Mr. Kabinga stated that the Organisation is highly expectant that the visit by the International Monetary Fund (IMF) Managing Director will yield positive results when it comes to economic reforms.
He said the Organisation is confident that discussions between Government and the IMF will review processes concerning debt restructuring process.
“On 22 January 2023 Zambia received the International Monetary Fund (IMF) Managing Director alongside the United States (US) Treasury Secretary for a high-profile country visit. Against the backdrop of debt distress, the Zambian government reached an agreement with the IMF in September 2022 – an Extended Credit Facility (ECF) that would run for 38 months. This visit should be a chance to address some of the more problematic aspects of that agreement,” he said.
Mr. Kabinga stated that in addition to national budget support, the IMF agreement has been perceived as a critical step in Zambia’s need for public debt restructuring and possible cancellation.
“With support from the National Creditors Committee that is chaired by China, Zambia is expected to be the second country after Chad to implement debt restructuring under the G20 Common Framework – thus the anticipated visit seeks to accelerate movement on debt relief that has stalled for several months. Zambia’s default on external private and bilateral creditors has eased some pressure on the government budget,” he said.
Mr. stated that the IMF and US should make clear that they will politically and financially support Zambia to remain in default on any creditor which does not agree to debt restructuring or agree to the amount of debt cancelation needed to make Zambia’s debt sustainable.
He added that if significant progress is made on debt cancelation that would be very much welcomed, but there are problems with the IMF agreement that also need to be addressed. One key problem relates to the policy steer on tax.
International Monetary Fund (IMF) Managing Director, Kristinah Georgieva, arrived in the country on Sunday 22nd January 2023 for a two-day visit and she is expected to get updates on how Zambia is making progress in restructuring its debt since it received the $1.3 billion IMF bailout in August last year.