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Zambia to hold IMF talks as coronavirus worsens economic outlook

LUSAKA (The Southern African Times) – Zambia will hold talks with the International Monetary Fund (IMF) on the southern Africa’s country request for an economic programme, its finance minister Bwalya Ng’andu said on Monday. 

African nations including Zambia have become heavily indebted in the past decade and are seeking support from the IMF, World Bank and European Union for wide-ranging debt relief. 

The IMF last week forecast Zambia’s economy will contract by 3.5% in 2020, from growth of 1.5% in 2019, as the coronavirus pandemic hits economies across the world. Zambia’s economic activity has also been hampered by widespread power shortages. 

“Zambia will now discuss with the fund on an appropriate macro-economic framework that will lead to a programme eventually,” Ng’andu told reporters. 

Talks with the IMF hinged mainly on debt sustainability, Ng’andu said, adding that Zambia had already embarked on measures including reduced borrowing and the suspension of some projects. 

Africa’s No.2 copper producer has also applied to the African Development Bank and the African Export and Import Bank for support under various coronavirus emergency funds, he said.

It was also in bilateral talks with several G20 countries on the postponement or rescheduling of debt service payments over a period to be agreed. 

To cushion local businesses from the fallout of the coronavirus pandemic, Ng’andu said Zambia had waived tax penalties and interest on outstanding tax liabilities and would suspend tax on medical supplies used to tackle the coronavirus.

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