IMF SUPPORTED EXTENDED CREDIT FACILITY (ECF) ARRANGEMENT: STATEMENT BY HONOURABLE
DR. SITUMBEKO MUSOKOTWANE, MP, MINISTER OF FINANCE AND NATIONAL PLANNING
Fellow countrymen, distinguished investors, development partners, and members of the international community,
I wish to provide clarification regarding Zambia’s engagement with the International Monetary Fund (IMF) under the Extended Credit Facility (ECF) arrangement and to outline the Government’s position regarding future cooperation with the IMF as we approach the conclusion of the current programme.
After careful consideration and extensive consultations, the Government has decided to successfully conclude the ongoing sixth and final review of the current ECF arrangement. Immediately thereafter, the government shall engage with the IMF on a successor programme. That successor program will still encompass issues of concluding Zambia’s debt restructuring commitments so that it is fully accomplished. However, other evolving economic priorities, especially economic growth ambitions and other medium-term development needs shall also be addressed.
In this context, the Government has decided not to pursue a one-year extension of the current ECF programme as earlier envisaged. Instead, we now intend to replace it with a full program that runs the full course. This decision should be understood as a reflection of programme completion of the current one and transiting on to a successor program. The decision should not be misunderstood to mean disengagement or any weakening of reform commitment.
At this stage, let me remind you that the current program started in 2022 and was expected to be concluded
November 2025. It will now hopefully be concluded mid-January 2026. This brief extension from November to
January was purely technical, intended to allow adequate time for the assessment of programme performance as of end-October.
I wish to underscore that Zambia has since 2022 successfully completed all reviews under the IMF-supported
programme, and that a staff-level agreement on the sixth and final review was reached last month. That review is subject to consideration and approval by the IMF Executive Board, in line with established Fund procedures.
Since the programme’s inception in 2022, Zambia has consistently delivered on key quantitative performance criteria and structural benchmarks. The implementation of the program has been exceptional good when compared to many other countries and indeed even to Zambia’s own performance in the past.
This strong track record, without any break or suspension, has underpinned decisive macroeconomic stabilisation. Fiscal consolidation has been firmly achieved, with primary fiscal surpluses exceeding 2 percent of GDP, demonstrating disciplined public financial management of spending within our means and a clear commitment to debt sustainability. These reforms have restored confidence and strengthened economic fundamentals. The IMF projects economic growth to exceed 5 percent in 2025, while inflation is expected to return to the target range of 6–8 percent within the next two years.
I wish to emphasise that the progress attained, has strengthened fiscal and external buffers – meaning that the
country’s ability to respond to shocks like disasters has improved. It also goes without saying that the progress has substantially underpinned Zambia’s external debt restructuring. These efforts have also positioned Zambia to benefit from the favourable copper prices by reviving the mining sector. Had the reforms not included bringing back to life mining companies, the higher copper prices prevailing now would have meant very little because benefits only occur when there are minerals to sell.
Having met all programme benchmarks and targets under the current IMF-supported arrangement, the policy priority is not to pursue a one-year extension of the current ECF programme but to deliberately transition towards a growth focused agenda that accelerates investment, supports job creation, and expands the productive capacity of the Zambian economy.
In this context, the Government will engage the Fund on a successor framework that builds on achieved
macroeconomic stability and shifts emphasis towards growth-oriented structural reforms, investment mobilisation, value addition, and the expansion of inclusive and sustainable economic opportunities.
I wish to provide clear assurance that during the transition period before a new programme is agreed and approved, the Government will remain firmly anchored to its reform path. Policy continuity will be underpinned by strict adherence to the approved national budget with expenditure execution, borrowing, and fiscal balances implemented within Parliament-approved ceilings.
In addition, Zambia will maintain close and in continuous engagement with the IMF, including through Article IV
consultations and other technical dialogue. Immediately following the conclusion of the current programme, we
intend to resume discussions with the IMF on a future, longer-term collaboration, anchored on the implementation of structural reforms that extend beyond the electoral cycle and further entrench macroeconomic stability, resilience, and inclusive growth.
The Government remains fully committed to:
• Maintaining debt sustainability through disciplined borrowing and sound liability management.
• Advancing fiscal consolidation to ensure public finances remain predictable and sustainable.
• Upholding prudent and transparent resource management, including efficient utilisation of mineral revenues;
and,
• Promoting inclusive economic growth that creates jobs, supports diversification, and improves livelihoods for all Zambians.
At the same time, the Government will continue to strengthen domestic resource mobilisation through improved tax administration, broadening the tax base—and efficiency gains—while maintaining prudent expenditure management.
Finally, the reforms we have undertaken and those yet to be undertaken, are not contingent on any single external arrangement. They reflect national ownership. As is evident now, our country is already benefiting from reform. Economic stability, economic growth, free education, expanding infrastructure, increase in foreign exchange reserves, more investments, addition to jobs, are all examples of fruits from the changes or reforms undertaken during the past four years. We will continue with more reforms so that other outstanding development challenges such as job creation can similarly be strongly tackled. In the same way that past reforms have led to visible progress that we see today, I am certain that outstanding issues like job creation will also be effectively addressed in the next program.
Finally, I wish to thank the staff, management and the Board of the IMF for the support that has brought us this far. I will not forget to thank the President and the Vice President for their active leadership, the cabinet for the support and collaboration, Parliament, Councils and indeed the people of Zambia for this success. Last but not least, I wish to thank my colleagues – the BOZ governor, the Secretary to the Treasury, the Commissioner General of the Zambia Revenue Authority and all their staff for the heavy lifting they continue to perform each day.
We look forward to continuing constructive engagement with the IMF and all other development partners as we
advance our shared objective of a prosperous, resilient, and inclusive Zambia.
I thank you.