Debt servicing consumes K34.9 billion, as govt spends K49.1 billion in June

Government spent K34.9 billion on debt servicing and dismantling of domestic arrears in June 2026, out of the K49.1 billion released to finance public service delivery, support vulnerable households, and fund infrastructure and development priorities, the Ministry of Finance and National Planning has announced.

Of the K34.9 billion for debt and arrears, K7.4 billion covered domestic debt service, K26 billion financed external debt service obligations — including the full buyback of Bond B at a discounted US$1.1 billion — while K1.5 billion was directed towards dismantling domestic arrears.

In a statement issued in Lusaka on Tuesday, Secretary to the Treasury Felix Nkulukusa said K5.5 billion of the total K49.1 billion went to the Public Service Wage Bill and related obligations.

He said the June releases were aimed at sustaining essential public services while creating conditions for long-term economic growth, investment, and job creation.

“The June releases demonstrate our determination to preserve fiscal credibility while continuing to invest in people, communities and economic opportunity,” Nkulukusa said.

For transfers, subsidies and social benefits, the Treasury released K4.2 billion. Notable allocations included K1.5 billion for the Social Cash Transfer Programme, K1.1 billion for Grant-Aided Institutions including public universities, and K610 million for Constituency Development Fund projects.

“Every budget release represents more than a financial transaction. It represents support for a family receiving a Social Cash Transfer, a young person accessing a bursary through CDF, a farmer benefiting from the Food Security Pack, a patient receiving healthcare in a public facility, and a community benefiting from improved infrastructure,” he said.

To facilitate the functioning of Ministries, Provinces and Agencies, K3 billion was released for general operations. This included K345 million for final gratuities for former Members of Parliament, K200 million to the Electoral Commission of Zambia to support preparations for the 2026 General Elections, and K48 million for payments to Zampost retirees.

“Every payment made towards debt obligations strengthens confidence in Zambia’s economic future, while every kwacha invested in social protection, education, health, local development and infrastructure contributes to improving the quality of life for our citizens,” Nkulukusa said.

Read More: Zambia pushes for debt transparency, stronger African voice at IMF, World Bank meetings

The Treasury also released K40 million to the Lusaka South Multi-Facility Economic Zone to strengthen the Zone’s capacity to attract investment, support manufacturing, and create employment. An additional K209.7 million was released for geological mapping to identify critical mineral resources and attract exploration investment.

On infrastructure, K1.4 billion was allocated to capital expenditure. Of this, K838.9 million went to road infrastructure, K200 million to education infrastructure projects, K200 million to water infrastructure development, K100 million to Mini Hospital infrastructure, and K79.7 million to projects under various Ministries, Provinces and Agencies.

The investments are intended to improve connectivity, enhance access to education and healthcare, strengthen water supply systems, and support economic productivity across the country, Nkulukusa said.

“As Government, our objective remains clear: to sustain macroeconomic stability, protect vulnerable households, attract investment, create jobs, and build a resilient economy capable of delivering prosperity for present and future generations,” Nkulukusa said.

He assured that the Government remained focused on prudent financial management, transparency, accountability, and ensuring public resources deliver maximum value to citizens.

Other allocations included K316.1 million for the Local Government Equalization Fund, K300 million for the Food Security Pack Programme, and K200 million to the Public Service Pension Fund.

WARNING! All rights reserved. This material, and other digital content on this website, may not be reproduced, published, broadcast, rewritten or redistributed in whole or in part without prior express permission from ZAMBIA MONITOR.