Lungu’s Crackdown On Zambia’s US$8.7 BILLION Debt

Following months of speculation over the true extent of Zambia’s debt, President Lungu has today announced several new austerity measures.

Today Finance Minister Margaret Mwanakatwe announced that on Thursday the President had ordered the cancellation of some existing loans, banned the issuance of letters of credit and guarantees to state owned enterprises and terminated financing of development projects that are below 80% completed. He has also imposed a cutback on ministerial travel with immediate effect.

In addition, the Ministry of Finance has banned all government officials from making public statements on economic matters and debt contraction. Seemingly in an attempt to prevent any more leaks like the FIC report that damaged their reputation.

She said the making of several statements on economic and financial matters by unmandated government officials has continued despite a cabinet decision against the practice adding that this has sent wrong signals that have impacted negatively on the performance of the economy.

Mrs. Mwanakatwe also announced that the debt sustainability analysis (DSA which has just been completed has confirmed that the total public external debt as at end March 2018 amounted to US$9.3 billion, up from US$8.7 billion in 2017 while domestic debt stock (government securities) amounted to K53.5 billion from K48.4 billion over the same period.

“Let me again, emphasise that we have reconciled all the debt with all our creditors and hereby confirm the debt position,” Mrs. Mwanakatwe stated.