Stock of external debt in Africa’s copper producer Zambia, rose 0.5% to $10.23 billion as at end of June comparing to $10.18 billion in first quarter of 2019. This was announced by the newly appointed finance minister Dr. Bwalya Ng’andu in his debut economic performance report on 16 July in Lusaka. The MinFin also revealed that the stock of domestic arrears has widened 7% to K16.6 billion as at first quarter of the year to K15.6 billion end of fourth quarter last year. Total domestic debt rose to K60.3 billion (June) a 3.4% increase from K58.3 billion (March).
Dr. Ng’andu acknowledged the key risks to the economy and stressed the need to reign in so as to restore fiscal fitness. The minister acknowledged that domestic arrears rose significantly and this would weigh on the growth potential of the copper producer especially that the number represents the liquidity that small to medium sized businesses have been deprived of hence the need to aggressively dismantle the outstanding stock.
Other focus areas include debt sustainability through slowing further the pace of external debt accumulation by trimming the number of projects the government is entering into.
Ng’andu a former central banker succeeds Mwanakatwe a former commercial banker and has a mammoth task well ahead of him. The copper producer looks to Ng’andu to deliver an IMF deal whose talks he has committed to rekindling, the 2018/2019 fiscal budget whose announcement is 2 months away, a controversial sales tax regime which he has committed to shelving for now and tackling key structural issues to restore investor confidence.
Compiled by Stacey Susa