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Secretary to the Treasury, Felix Nkulukusa, says Zambia’s debt restructuring has significantly eased the country’s external debt burden, restoring macroeconomic stability and creating room for increased spending on social services, infrastructure and economic development.
In a statement issued on Friday, Nkulukusa said the restructuring had transformed the country’s fiscal position after Zambia became Africa’s first COVID-19-era sovereign default in November 2020.
He attributed the default to years of excessive borrowing, weak economic growth, falling copper prices, electricity shortages, high inflation and the depreciation of the kwacha.
“Before restructuring, government spent nearly K70 out of every K100 collected in domestic revenue on servicing external debt, making it difficult to finance essential public services,” he said.
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Following the restructuring, external debt servicing has fallen to about K15 for every K100 of domestic revenue, while annual payments have dropped to around US$900 million from an estimated US$2.6 billion.
According to Nkulukusa, the reduced debt burden has enabled Government to channel more resources towards free education, healthcare, agriculture, social protection, infrastructure development and the Constituency Development Fund.
He also said Zambia secured about US$1.7 billion under the International Monetary Fund’s Extended Credit Facility, including additional financing to cushion the effects of the 2023/2024 drought.
The programme helped rebuild international reserves to US$6.5 billion by June 2026 from about US$3 billion in 2021.
Nkulukusa said economic reforms undertaken alongside debt restructuring had contributed to stabilising the kwacha, reducing inflation to the Government’s target range of 6 to 8 percent and narrowing the fiscal deficit from 9 percent in 2021 to 3.8 percent in 2025.
He added that improved investor confidence had seen the Zambia Development Agency issue more than 2,300 investment licences worth about US$97 billion between 2021 and June 2026, with US$19 billion already invested and supporting about 150,000 jobs.
Nkulukusa said government would now focus on sustaining fiscal discipline while translating macroeconomic stability into jobs, higher incomes and improved living standards.
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