May 29, 2024

IMF Managing Director Welcomes Debt Treatment Agreement Reached by Zambia and Its Official Creditors under the G20 Common Framework

Managing Director Kristalina Georgieva participates in bilateral meeting with President of Zambia Hakainde Hichilema at the State House in Lusaka, Zambia. IMF Photo/Kim Haughton 23 January 2023 Lusaka, Zambia Photo ref: KH230123059.jpg

The Managing Director of the International Monetary Fund (IMF), Ms. Kristalina Georgieva, on Thursday, the announcement that Zambia and its official creditors have reached an agreement under the Group of 20 (G20) Common Framework, saying that the agreement aligns with the objectives of the IMF-supported program.

The debt treatment agreement represents a significant step forward for Zambia’s economic stability and financial well-being. It reflects the commitment of all parties involved to address Zambia’s debt challenges and foster a more sustainable economic path for the country.

Georgieva commended Minister of Finance Situmbeko Musokotwane for the announcement and praised the Zambian authorities for their efforts in reaching this debt treatment agreement with official creditors.

The agreement encompasses both a baseline treatment and a contingent treatment that would be activated automatically if Zambia’s economic performance and policies improve.

Ms. Georgieva extended her gratitude to the official creditor committee, singling out China and France as co-chairs and South Africa as Vice-Chair, for their extensive work in achieving this milestone.

The collaborative effort marks a significant accomplishment for the G20 Common Framework, which brought together China, India, Saudi Arabia, and Paris Club creditors to ensure substantial debt relief for Zambia.

The agreed-upon debt treatment sets the stage for the completion of the first review of Zambia’s three-year Extended Credit Facility Arrangement. The arrangement, facilitated by the IMF, plays a crucial role in guiding Zambia toward sustainable economic growth and poverty reduction.

Ms. Georgieva expressed her anticipation for the IMF Executive Board to undertake the review in the upcoming weeks. She also expressed her optimism for the continuation of productive collaboration between the IMF and Zambia in the future.

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