Debt Ratio Falls Below 100% for First Time in 7 Years

Zambia’s public debt-to-GDP ratio is projected to decline to approximately 91.1 percent by December 2025. This marks the first time in over seven years the ratio has fallen below the 100 percent threshold.

The latest IMF Country Report on Zambia, issued on August 5, 2025, forecasts a continued downward trajectory, with an expected drop to 69.9 percent by 2027.  

The IMF attributes Zambia’s improved outlook to a mix of sound fiscal policies, progress in external debt restructuring negotiations, and a stronger economic framework supported partners.  

Dr Situmbeko Musokotwane, Financial and National Planning Minister, has welcomed the report, describing it as a strong sign of macroeconomic stability and a direct outcome of the government’s successful economic reform agenda.  

Dr Musokotwane stated “A declining debt-to-GDP ratio is a critical indicator that the economy is growing faster than the debt burden, reducing the risk of debt distress.”

“Numbers don’t lie. Our prudent economic management and debt restricting efforts are beginning to bear fruit. The difference is evident. The lower the public debt-to-GDP ratio, the greater the investor confidence in our economy. This translated into more jobs, more development, and more wealth for the nation.”

Reduced public debt levels are expected to provide greater fiscal flexibility, enabling increased government investment in key sectors such as infrastructure, health, education, and social protection.

The improvement in Zambia’s debt-to-GDP ratio trajectory also enhances the country’s creditworthiness, lowers borrowing costs, and strengthens its reputation amongst international financial institutions, development partners, and investors.