In a press release received by APA on Thursday, the Board of Directors of the African Development Bank Group announced in Abidjan on December 11 that it had approved a loan of US$108 million to Zambia to establish the Fiscal Sustainability and Economic Resilience Support Program.
The program aims to strengthen the country’s economic governance and implement real sector reforms to build a resilient and diversified Zambian economy, according to the release.
“It is a multi-sectoral program designed to strengthen fiscal sustainability, increase private sector participation in the economy, with particular emphasis on agro-industrial development, climate-smart investments, including public-private partnerships, and micro, small and medium enterprise development,” said Raubil Durowoju, African Development Bank Country Manager in Zambia.
On the one hand, the program will help improve domestic revenue mobilization through support for the implementation of several measures: the deployment of the electronic invoicing solution (“smart invoice”) and registration of 12,000 VAT taxpayers, the country’s membership in the Global Forum on Fiscal Transparency and Exchange of Information for Tax Purposes.
Likewise, according to the press release, the project will also support the efficiency and transparency of public spending by supporting the Public Investment Management Strategy to further improve the public investment management framework.
On the other hand, the program plans to stimulate agro-industrial development for economic growth by supporting the agricultural mechanization strategy implemented by the Ministry of Agriculture and the creation of ten mechanization centers.
The objective is to improve agricultural productivity, increase production and supply national and international markets by providing rental equipment to farmers who do not have access to it.
The project will also support the Ministry through a sustainable agricultural financing mechanism. It will disburse at least 257 million kwacha (approximately $9.4 million) for the 2023-2024 agricultural season.
This is a market-based initiative, managed by the private sector through financial institutions, that provides tailored financing in the form of agricultural inputs to the agricultural sector, particularly to small- and medium-scale farmers who have limited access to affordable financing.
As of November 30, 2024, the African Development Bank Group’s active portfolio for Zambia comprised 24 projects totaling $872.3 million.
ARD/te/lb/as/APA