The International Monetary Fund (IMF) has approved the disbursement of about US$184 million to Zambia following the fourth review of an extended credit facility.
The Bretton Woods institution said it had completed its fourth review of Zambia’s 38-month Extended Credit Facility (ECF) Arrangement and that its executive board was satisfied with the southern African country’s performance to date.
“Completion of the review allows for an immediate disbursement of SDR 139.88 million (about US$184 million), bringing Zambia’s total disbursement under the ECF-supported programme to SDR 992.86 million (about US$1.3 billion),” the IMF said in a statement on Tuesday.
Zambia’s ECF Arrangement was approved in August 2022 for about US$1.3 billion, with the amount increased to US$1.7 billion in June 2024.
The programme supports Zambia’s home-grown Eighth National Development Plan that seeks to entrench macroeconomic stability, attain debt and fiscal sustainability, enhance public governance and foster inclusive growth to improve the livelihood of the Zambian people, especially the vulnerable.
The IMF applauded the Zambian authorities for their commitment “to maintaining macroeconomic stability and restoring fiscal and debt sustainability, while supporting vulnerable households and advancing structural and governance reforms to foster growth.”
Zambia is in the final stages of exiting a lengthy debt restructuring process after defaulting in 2020.
The country is currently grappling with the effects of a severe El Niño-induced drought, which has driven inflation to a three-year high as Zambia imports food and electricity to mitigate the shortfalls.
The nation relies on hydropower for the bulk of its electricity generation, making it highly vulnerable to reduced water supply.
JN/APA