Stronger Revenues Narrow Budget Deficit to 3.4 Percent of GDP

Finance Minister Situmbeko Musokotwane has announced that Zambia's 2025 National Budget outperformed expectations, with stronger-than-projected tax collections driving a significant reduction in the fiscal deficit.

Delivering a Ministerial Statement to the National Assembly on Zambia's International Monetary Fund (IMF) Extended Credit Facility programme, Dr. Musokotwane reported that total revenues and grants reached K187.85 billion — 1.3 percent above target. Domestic revenues exceeded projections by 2 percent, with tax revenues hitting K143.6 billion, while non-tax revenues surpassed targets by nearly 6 percent.

The stronger revenue performance, combined with tighter expenditure controls, helped narrow the budget deficit to 3.4 percent of GDP — a marked improvement on the projected 4.6 percent.

Dr. Musokotwane credited enhanced tax administration and sustained fiscal discipline under the ongoing reform programme, arguing that both have strengthened Government's ability to fund critical social and development priorities. These include free education, the Constituency Development Fund, and the Cash-for-Work programme — initiatives that directly benefit millions of Zambians.

Looking ahead, the Minister reaffirmed Government's commitment to deepening domestic resource mobilisation, reducing dependence on external borrowing, and protecting long-term economic stability.

The figures represent a further sign that Zambia's fiscal consolidation is gaining traction, with reform dividends beginning to translate into measurable results for public finances.