We welcome the authorities request for a debt treatment under the G20 Common Framework and hope that official creditors can quickly form a committee and provide financing assurances. At their request, a comprehensive IMF-staff supported governance diagnostic assessment was launched in January 2022 to identify the main governance weaknesses and risks of corruption, as well as specific measures to address them. endstream
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The conditions are incredible, unbelievable, and. LUSAKA, Dec 3 (Reuters) - The International Monetary Fund and Zambia on Friday reached a staff level agreement on a $1.4 billion, three-year extended credit facility, which could bring the heavily indebted country one step closer to a comprehensive debt overhaul. Browse an unrivalled portfolio of real-time and historical market data and insights from worldwide sources and experts. per capita by about a quarter. Georgieva said in a Twitter message the Zambia loan approval was a "major milestone" for the long-stalled G20 effort, showing that it can deliver results for other debt-burdened countries. The next step is for the Official Creditor Committee for Zambia, under the G20 Common Framework, to agree with the authorities the specific modalities of how official creditors intend to deliver debt relief consistent with Fund-program parameters in the form of a Memorandum of Understanding (MoU).
IMF Executive Board Approves New Extended Credit Facility (ECF Zambia is in a debt crisis. %%EOF
ii)Ensure the Fund-program is fully financed. A key objective of the authorities reform program, supported by the Fund, is to gradually increase the level and quality of social spending to reduce poverty and inequality, as well as improve access to basic social services, especially in rural areas. Aug 31 (Reuters) - Zambia won International Monetary Fund approval for a $1.3 billion, 38-month loan program on Wednesday, a crucial step in the southern African country's quest to restructure its debts and rebuild an economy ravaged by mismanagement and COVID-19. Exclusive news, data and analytics for financial market professionals, Reporting by Chris Mfula in Lusaka and Karin Strohecker in London; additional reporting by Tommy Wilkes, editing by Marc Jones and Aurora Ellis, Yellen sees 'progress' in rocky US-China ties, expects more communication, U.S. calls Pan Gongsheng China's central-bank 'head', suggesting unannounced promotion, Solomon Islands leader visits security partner China with focus on infrastructure, UK's Hunt to detail plans to steer pensions into growth investment, BBC faces questions as presenter accused of paying teenager for pictures, Dynamo Kyiv criticise Fenerbahce for pre-season games in Russia, Eramet in talks with European carmakers over Argentina lithium plan, CEO says, Netanyahu signals impatience with protests as Israel's judicial reform edges ahead, China sets wide-ranging rules for $2.9 trillion in private investment funds. Browse an unrivalled portfolio of real-time and historical market data and insights from worldwide sources and experts. To remove any hurdles to the timely completion of the review, Zambia needs official creditors to move forward and reach agreement on a debt treatment in line with the financing assurances they provided in July 2022. INTRODUCTION The acceptance of International Monetary Fund (IMF) conditionality often has extreme political consequences for the reform-minded governments of developing countries. Ministry of Finance and National Planning, #mofnp, Lusaka-Zambia to OFFICIAL GROUP - Ministry of Finance & National Planning We support the authorities efforts to maintain a constructive engagement with private creditors to help secure a deal on comparable terms to official creditors. endstream
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Our Standards: The Thomson Reuters Trust Principles. "The first concrete step towards the finalisation of an IMF financial support package which has been many years in the making is indeed a very good sign that authorities provided the much-needed (and previously lacking) financing assurances," said Irmgard Erasmus, senior financial economist at Oxford Economics. Strengthening governance and reducing the risk of corruption, including by improving public financial management are critical to addressing the root causes of the debt crisis faced by Zambia. "This agreement is based on the authorities plans to undertake bold and ambitious economic reforms," Allison Holland, IMF mission chief for Zambia said in an emailed statement. The International Monetary Fund (IMF) has published the conditions attached to the newly agreed programme with the Zambian government. To read the full press release, click here. recent years has greatly relied on the much-improved effectiveness and This shift will be underpinned by an ambitious medium-term agenda to enhance revenue mobilization through policy changes and administrative changes. An IMF spokesperson didn't immediately reply to a request for comment. Zambia won International Monetary Fund board approval for a $1.3 billion support package, an important step toward the nation restructuring its debt and a boost for the global effort to help. Zambia will have access to about US$188 million in financing once the review is approved by IMF Management and formally completed by the IMF Executive Board. 359 0 obj
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The IMF reached in April a staff-level agreement on the first review, but a debt restructuring agreement with official creditors was needed before the board could complete the programme's review. All rights reserved. See here for a complete list of exchanges and delays. IMF Members' Quotas and Voting Power, and Board of Governors, IMF Regional Office for Asia and the Pacific, IMF Capacity Development Office in Thailand (CDOT), IMF Regional Office in Central America, Panama, and the Dominican Republic, High-Level Summary Technical Assistance Reports, Financial Sector Assessment Program (FSAP), Currency Composition of Official Foreign Exchange Reserves. Getting approval from the IMF for a programme is a key step for countries in the debt restructuring process. The industry leader for online information for tax, accounting and finance professionals. At the conclusion of the mission, Mr. Porter issued the following statement: "I am pleased to announce that the IMF team has reached a staff-level agreement with the Pakistani authorities on a nine-month Stand-by Arrangement (SBA) in the amount of SDR2,250 million (about $3 billion or 111 percent of Pakistan's IMF quota). New laws and regulations around government purchasing and more transparency in spending will promote accountability and let Zambians see how their taxes are being spent. Some cookies allow third parties to tailor the ads you see when you visit our site and other third party websites. The IMF Executive Board has approved a three year 1.3 billion US dollar program to support the government's reform efforts under this program to help bring public debt back under control, Zambia's government aims to cut wasteful spending or spending that doesn't help the poor, such as fuel subsidies. The IMF Press Center is a password-protected site for working journalists. United Nations' Secretary-General Antnio Guterres condemned the air strike that reportedly killed at least 22 people in Sudan on Saturday, according to a statement released by a spokesperson early on Sunday.
Official bilateral creditors will then implement the MoU through bilateral agreements signed with Zambia while agreements in principle reached with private creditors will also be implemented through various modalities. It publishes over 2,500 books a year for distribution in more than 200 countries. s?- P
Editorial policy avoids commitment to any political viewpoint or ideology, but aims at a fair examination of controversial issues in order to promote a deeper understanding of what is happening in Africa today. The restructuring of its external debt, which amounted to more than $17 billion at the end of 2021, is seen by many analysts as a test case for the region. The International Monetary Fund and Zambia on Friday reached a staff level agreement on a $1.4 billion, three-year extended credit facility, which could bring the heavily indebted country one step . IMF Statement on Zambia.
This will free up some fiscal space to increase social spending to ease transition burdens on the most vulnerable, she said. 319 0 obj
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How much debt relief does Zambia need? These reforms seek to remedy past weaknesses in economic governance and public financial management that led to an unsustainable debt overhang. Zambia, one of the world's largest copper producers, became Africa's first pandemic-era sovereign defaulter last November after years of chronic government overborrowing from international institutions drove its debt burden above 120% of annual economic output.
Zambia wins IMF board approval for $1.3 billion loan program 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. The authorities reform program should support a return to price stability over the medium term., In light of unsustainable public debt, the authorities reform efforts will need to be supported by a comprehensive debt restructuring. ]7W@kEo4 |@e&2g4U8? 2023 International Monetary Fund. Political resistance to International Monetary Fund (IMF) reform in developing countries has become a major obstacle to reform implementation. Press Releases.
Will the delivery of key social programs like free education be impacted? All quotes delayed a minimum of 15 minutes. Achieving this goal also implies the restructuring would need to bring the present value of external debt-to-exports ratio to a level consistent with substantial space to absorb shocks by 2027. The journal also includes an invaluable book review section. Implications of I.M.F. %PDF-1.7
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As a result, Zambia is in debt distress, defaulting on its Eurobonds in November 2020 while also accumulating arrears to other creditors. The domestic revenue mobilization strategy is anchored on policy changes to increase revenues from corporate income tax, VAT, and excises as well as improvements in tax administration.
IMF -- IMF Office in Zambia Reuters provides business, financial, national and international news to professionals via desktop terminals, the world's media organizations, industry events and directly to consumers. Living standards for most of the population have deteriorated sharply, with falling real wages and a drop in G.D.P. All Rights Reserved. Further details on the agreement will be released on Monday.". All quotes delayed a minimum of 15 minutes.
Zambia Gets IMF Bailout, Marking Progress for G-20 Debt Plan All rights reserved. banks operational independence and credibility is maintained, particularly Browse an unrivalled portfolio of real-time and historical market data and insights from worldwide sources and experts. The International Monetary Fund executive board will meet on July 12 to complete the first review of its $1.3 billion extended fund facility (EFF) programme for Zambia, according to people with .
IMF Zambia's Extended Credit Facility Arrangement - The NewsMarket The war in Ukraine has increased prices of fuel and fertilizer, amplifying pressures further.
Together with Chad and Ethiopia, Zambia is one of the three countries that have requested a restructuring of its external debt under a common framework agreed last year by China and other Group of 20 members, and the Paris Club of major creditor countries. That's where the G20 initiative to restructure debt comes in. Reuters provides business, financial, national and international news to professionals via desktop terminals, the world's media organizations, industry events and directly to consumers. Safeguarding central bank autonomy, and monetary and financial stability also remains a priority. The economic program aims to restore macroeconomic stability and foster higher, more resilient, and inclusive growth. Is another debt restructuring needed after the program ends. Monetary policy, Please address any questions about this title to publications@imf.org.
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