VenturesNow

Zambia: IMF releases $187 million after its second review

Published

12 months ago

December 21, 2023

Following the conclusion of its second review of Zambia’s Extended Credit Facility (ECF), the Executive Board of the International Monetary Fund (IMF) has disbursed roughly US$187 million to the southern African country.

The programme will continue until October 2025, and performance reviews will occur every six months. The next evaluation is planned for April 2025.

This action comes after the first review was approved in July 2023, and about US$188 million was disbursed. Out of the total amount of US$1.3 billion anticipated under the 38-month ECF programme with the IMF, approved on August 31, 2022, the total disbursements made thus far are US$561 million.

The ECF funds have an extended grace period and 0% interest. It is conditioned upon domestic economic reforms implemented by the Zambian government in an effort to achieve debt and budgetary sustainability, boost inclusive, robust, and higher growth, and restore macroeconomic stability.

In response to the development, Dr. Situmbeko Musokotwane, Minister of Finance and National Planning, praised the multilateral body’s decision and highlighted the nation’s economic resilience in the face of significant adversity.

Thanking all contributors to keeping the economic transformation process moving forward, he also acknowledged the progress made in terms of growth, fiscal performance, and ongoing debt restructuring negotiations with creditors.

The minister reaffirmed the government’s dedication to achieving the goals of the ECF programme and urged people worldwide to continue lending support. He acknowledged the need for strict reform measures and emphasised their critical role in improving livelihoods in all regions, fostering the growth of the private sector, and creating jobs.

Obstacles in mining, construction, and agriculture hindered its post-pandemic recovery after the economy contracted by 2.8% in 2020. It, however, recovered in 2021, with real GDP growing by 4.6%. Zambia was the first African country to default on its foreign debt following the COVID-19 pandemic. It has continued to seek debt restructuring with creditors under the G20 framework.

The IMF loan could be considered an endorsement of the government’s recent economic reforms and a positive for investors’ confidence in Zambia’s copper-dominated economy.

Related Topics:Debt restructuring Featured IMF Zambia

Click to comment

VenturesNow

Nigeria’s $42bn foreign reserves enough for 9 months’ imports— Central Bank

Published

2 hours ago

December 20, 2024

Ifeoluwa Dada

According to Olayemi Cardoso, Governor of the Central Bank of Nigeria (CBN), the nation’s $42.01 billion in foreign reserves can cover imports of goods and services for almost nine months.

Cardoso promised Nigerians improved economic fortunes in 2025 while addressing the Senate Committee on Banking, Insurance, and Other Financial Institutions yesterday in Abuja at the presentation of the performance index report.

Cardoso stated: “External Reserves rose from $ 38.35 billion it was on September 30, 2024, to $ 42.01 billion as of December 12, 2024”.

He clarified that third-party receipts in Q3 2024 and revenues from taxes connected to crude oil were the main drivers of the rise in foreign reserves during the specified time.

“We saw remarkable improvements in our trade balance and maintained a current account surplus,” he added.

“Our external reserves level can finance over 9.09 months of import of goods and services or 13.91 months only, higher than the international benchmark of 3.0 months and a robust buffer against shocks”.

On cash shortage, the CBN boss reiterated the N150 million fine against any branch of banks caught illegally distributing new Naira notes to currency hawkers and unscrupulous elements and said the Nigerian economy will improve in 2025 through policies and measures.

He predicted a stronger economic future: “Despite our economy’s challenges, there are clear reasons for optimism.

“The gradual stabilization of the forex market, ongoing banking sector recapitalization, and positive growth trends in key sectors, especially the services sector, indicate a path toward recovery and stability.”

VenturesNow

Tanzania tells IMF economy projected to grow by 6% in 2025

Published

3 hours ago

December 20, 2024

Ifeoluwa Dada

Tanzania’s economy is expected to grow by about 6% in 2025 from an estimated 5.4% growth in 2024, its finance minister and central bank governor said in a letter to the International Monetary Fund (IMF).

Some of the potential risks to the performance in the near term would include intensification of regional conflicts, increased commodity price volatility, a global economic slowdown and natural disasters related to climate change, Finance Minister, Mwigulu Nchemba, and Central Bank Governor, Emmanuel Tutuba, said.

Real GDP increased by 5.3% in 2023 from 4.7% in 2022, propelled by private investments on the demand side and manufacturing, construction, and agriculture on the supply side.

Strict monetary policy and moderate food and energy prices contributed to the decline in inflation from 4.3% in 2022 to 3.8% in 2023. In 2023, the Tanzanian shilling lost 8% of its value due to a lack of foreign exchange.