Finance Minister Margaret Mwanakatwe says she is targeting to secure an International Monetary Fund (IMF) economic bailout package by the end of this year.
According to Bloomberg, Mwanakatwe made the remarks on the side-lines of the ongoing 25th Mining Indaba in Cape Town, South Africa, where she attended alongside several other government officials.
“I would want to see a programme with the IMF; I think it would be good for us. I would love to see something in place by the end of the year. That is why we put in place various measures to ensure that we have a way forward that is sustainable debt-wise,” Mwanakatwe told Bloomberg in an interview in Cape Town, Tuesday.
IMF officials visited Zambia last November and are due to return in March for three weeks, where the package will be on the agenda, according to Mwanakatwe.
Zambia is still seeking a crucial US $1.3 billion bailout package in balance of payments support from the Fund.
But talks on the programme have dragged on since 2016, with the latest setback suffered last July when talks on Zambia’s economic bailout package were suspended owing to concerns surrounding the country’s debt sustainability.
Mwanakatwe, however, ruled out any possibility of Zambia defaulting on its foreign debt.
“At that (March) meeting, we hope we can come to a meeting of minds as to what exactly they would require from us in order to engage for a programme,” said Mwanakatwe.
Other stakeholders, such as local think tank ZIPAR have cautioned government that the IMF’s visit to Zambia next month did not imply that a Fund-backed programme will be actualized because the Zambian government still had to address pressing economic challenges, such as the widening fiscal deficit.
Meanwhile, Mwanakatwe stressed that the introduction of the Goods and Services Tax (GST), due to take effect after next month, remains on course.
“[GST] on 1st April, 2019, is not only a path of best practice but it will also eliminate the unsustainable and laborious process of VAT refunds. We are constantly in a refund position; it is unsustainable, hence us going to GST, just like America, just like Australia, just like India, just like Malaysia,” Mwanakatwe insisted in a statement availed by Ministry of Finance spokesperson Chileshe Kandeta, Thursday.
“Zambia is following best practice and we are ensuring that we can fully engage the public before the implementation date [1st April, 2019].”
According to Kandeta, the Minister was speaking when the Zambian delegation toured mining sector exhibition stands at the 2019 Mining Indaba in Cape Town, South Africa.
Among the Zambian stands visited were those of the Copperbelt Energy Corporation, ZCCM-IH, Vedanta – Konkola Copper Mines, and the Ministry of Mines and Minerals Development.
Mwanakatwe described the Indaba as a good platform for investment promotion, and has since returned to Lusaka. Bloomberg.