Mutati spells out out IMF role
THE International Monetary Fund (IMF) is not here to bailout Zambia as it is only a facilitator to access budget support, said Minister of Finance, Felix Mutati
Mr Mutati told Parliament yesterday that the engagement was aimed at leveraging international support for attaining government’s key objectives of restoring fiscal fitness, debt sustainability, addressing external sector vulnerabilities, job creation and sustained inclusive growth and development.
He emphasised that the engagement did not mean that the IMF was here to bail out Zambia. “We have as a nation defined the Economic Stabilisation and Growth Programme (ESGP) that is required to move the economy forward. IMF is being engaged to provide Balance of Payments (BoP) support as well as provide an independent policy assessment,” he said.
Mr Mutati said significant progress had so far been made in undertaking policy and structural reforms under the ESGP, which the IMF had also acknowledged and commended to government.
The minister told Parliament that the major outstanding issues under discussions with the IMF were the need to take measures to slow down the pace of debt accumulation and return Zambia’s debt risk from high risk of debt distress to low risk and scaling up fiscal consolidation measures, particularly expenditure restraint.
"Both these aspects are part of our key reform measures and are clearly outlined in the Economic Stabilisation and Growth Strategy. What the IMF has asked is to have these measures accelerated," said Mr Mutati.
He said the task as a nation was to ensure that borrowing was within the capacity to pay and to refocus expenditures while enhancing domestic resource mobilisation.
Mr Mutati said ESGP will enhance flows from private sector investors and reduce negative sentiments on the investment climate in the country.