As Zambia begins the process of shortlisting financial advisers to help reduce its debt load, the country has applied to the International Monetary Fund (IMF) for a COVID-19-related rapid credit facility.
Already wrestling with a growing public debt even before the Coronavirus outbreak forced lockdowns across the globe, the pandemic dealt a big blow to demand for raw materials. Zambia is Africa’s second biggest copper producer.
The IMF in April, forecast Zambia’s economy would contract by 3.5% in 2020, down from growth of 1.5% in 2019, due to the impact of the Coronavirus pandemic on the global economy.
Zambia’s economic activity has also been hampered by widespread power shortages.
The Zambian government’s external debt stock jumped to 45% of gross domestic product (GDP) in 2019, up from 37% in the previous year, while its total debt stock is estimated at 89%, according to World Bank data.
The IMF has approved requests for emergency pandemic aid from 50 of its 189 members for a total of about $18 billion, a spokesman for the Fund said on Thursday.
The number of new coronavirus cases in Zambia rose to 252 on Saturday and deaths from the highly infectious respiratory disease increased to seven according to Health Minister, Chitalu Chilufya.