The IMF never stops coming to play firefighters, especially in Africa. The International Monetary Fund (IMF) said it agreed on Saturday to release $1.3 billion in loans to Zambia, whose debt has just been restructured after an agreement with the country’s creditors, including France and China and members of the G20.
In a press release, creditor countries and private lenders all agreed to review their requirements on Zambia’s debt in exchange for Lusaka’s commitment to undertake economic reforms. The southern African country has already defaulted on its debt, valued at $17 billion, in 2020 during the pandemic. The release of an amount of 1.3 billion from the IMF over three years, validated in December 2021, was suspended from a restructuring of the Zambian debt.
On Saturday, IMF Managing Director Kristalina Georgieva praised ” the insurance “ given by Zambia for a debt relief and confirmed that the board of directors would approve the disbursement of the funds.
« This support for the G20 Common Framework demonstrates that international partners are coming together to help countries solve their debt problems, which sends a strong signal to other countries seeking to restore debt sustainability, achieve growth sustainable and reduce poverty »she insisted.
IMF lends faster and easier than ever
For its part, the Zambian government, through the voice of its finance minister, says it is committed « to implement the much-needed reforms, to be transparent about its debt and to ensure fair and equitable treatment of its creditors ».
The combination of the pandemic, inflation and tensions over raw materials has weakened the public finances of many nations, particularly in Africa where the IMF has continued to intervene in recent weeks from Tunisia to Ghana via Egypt and now Zambia.
In this chaotic context, the fund releases more and more loans, to about half of its 190 members. Highly criticized for the consequences of the austerity measures previously imposed, the Fund has relaxed its lending criteria, which are less and less demanding on the counterparties requested, particularly in terms of reforms. Above all, the IMF is facing new competition from the massive loans that China is developing for poor countries. And wants to remain the first lender of last resort.
(With AFP)