Zambia got an International Monetary Fund approval for a $1.3 billion, 38-month loan program on Wednesday. This is a crucial step in the southern African country’s quest to restructure its debts and reignite its economy which has been ravaged by mismanagement and COVID-19.<\/p>\n
The IMF said in a statement that the new Extended Credit Facility arrangement would provide total funding of 978.2 million Special Drawing Rights – about $1.3 billion at current exchange rates – equivalent to 100% of Zambia’s Fund quota, or shareholding.<\/p>\n
Approval by the IMF’s Executive Board will unlock an immediate disbursement of about $185 million, the Fund said.<\/p>\n
China and France – Zambia’s main creditors pledged in late July to negotiate a restructuring of the country’s debts. This move was welcomed by IMF Managing Director Kristalina Georgieva who said it was “clearing the way” for the new Fund program.<\/p>\n
“Zambia continues to face profound challenges reflected in high poverty levels and low growth,” Georgieva said on Wednesday. “The ECF-supported program aims to restore macroeconomic stability and foster higher, more resilient, and more inclusive growth.”<\/p>\n
Georgieva said in a Twitter message the Zambia loan approval was a “major milestone” for the long-stalled G20 effort. \u00a0This showed that IMF can deliver results for other debt-burdened countries.<\/p>\n
\nCongratulations to \ud83c\uddff\ud83c\uddf2 President @HHichilema<\/a> & his team on the $1.3 billion IMF program approved by the IMF Board today.<\/p>\n
We\u2019re proud to support Zambia\u2019s homegrown reforms and actions to help build a better future for all Zambians. https:\/\/t.co\/3bVrWF6v3x<\/a> pic.twitter.com\/bTlmJi6GG0<\/a><\/p>\n
— Kristalina Georgieva (@KGeorgieva) August 31, 2022<\/a><\/p><\/blockquote>\n