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Zambia warned against unsustainable borrowing under new IMF programme
The Centre for Trade Policy and Development (CTPD) has warned Government against accumulating unsustainable debt under the proposed US$1.5 billion International Monetary Fund (IMF) programme, urging authorities to direct any new borrowing towards productive investments. In a statement issued on Wednesday, CTPD Head of Advocacy…
Picture: Zambia Monitor
The Centre for Trade Policy and Development (CTPD) has warned Government against accumulating unsustainable debt under the proposed US$1.5 billion International Monetary Fund (IMF) programme, urging authorities to direct any new borrowing towards productive investments.
In a statement issued on Wednesday, CTPD Head of Advocacy and Campaigns, Natalie Kaunda, said the proposed three-year Extended Credit Facility (ECF) should consolidate the gains made under the previous programme without exposing Zambia to renewed debt vulnerabilities.
Kaunda said the staff-level agreement reached between Government and the IMF was an important step, but remained subject to approval by the Fund’s Executive Board.
“The previous ECF programme, introduced in 2022 when Zambia was in debt distress following its 2020 sovereign default, supported fiscal consolidation, macroeconomic stabilisation and external debt restructuring,” she said.
The programme concluded in January 2026, with total IMF disbursements reaching approximately US$1.7 billion. It also supported efforts to strengthen public financial management and rebuild economic reserves.
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Kaunda urged Government to expedite outstanding debt restructuring arrangements and ensure that any remaining agreements were consistent with debt sustainability and the country’s long-term financing needs.
She said sustainable debt management required more than meeting repayment obligations, stressing the need to build an economy capable of generating domestic revenue, earning foreign exchange, creating jobs and financing essential public services without repeatedly relying on unsustainable borrowing.
Kaunda also called on Government and the IMF to safeguard social spending under the proposed programme, particularly in education, healthcare, social protection, agriculture and productive infrastructure.
She said investment in these sectors was essential to strengthening the economy’s productive capacity and enabling citizens to participate in economic activity.
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