The Patriotic Front government has continued borrowing with the latest acquisition being a $200 million loan from the World Bank intended for feeder roads.
And government has paid K308.5 million of debt owed to Zesco, Zambia State Insurance Corporation (ZSIC), and Zamtel by various ministries, provinces, and spending agencies.
According to a statement issued by Ministry of Finance Head of Public Relations Chileshe Kandeta yesterday, Finance Minister Felix Mutati announced that Cabinet had approved the loan acquisition for feeder roads works in all parts of the country.
“In order to speed up our economic diversification drive, we need to facilitate the construction of feeder roads so that the agriculture logistical chain operates smoothly. When the programme commences, numerous jobs will be created all over the country from the time construction starts and as we progress in our economic diversification drive through agriculture, tourism and industrialization,” said Mutati.
Last week, government acquired a $150.57 million loan from the African Development Bank (ADB) for a water and sanitation programme.
And Kandeta stated that Zesco had been paid K172.6 million while ZSIC had been paid K91.9 million and Zamtel had gotten K44 million.
“The funds paid to the three State-Owned-Enterprises through a debt swap mechanism have been ring-fenced to off-set some outstanding tax obligations to the Zambia Revenue Authority, in line with the government’s fiscal consolidation initiative. Commenting on the development, Minister of Finance Felix Mutati has said the initiative to activate a debt-swap with the three companies is in line with the government’s fiscal consolidation policy through which the dismantling of arrears is one of the strategies being used to inject liquidity in the market and stimulate private sector participation in the economy through growth and job creation activities,” Kandeta stated.
He stated that Mutati pledged government’s continued support to stabilize parastatals.
“The Minister has noted the positive performance of Zamtel over the last few months, adding that, ‘the government will continue to ensure that state-owned-companies are helped to commercially stabilize by cleaning up their balance sheet so that they compete favourably; grow their businesses; and, perform in a manner that is worth the money for which the public pays for the goods and services which they produce’,” stated Kandeta.