Zambia’s intention to engage the International Monetary Fund (IMF) on a successor Extended Credit Facility (ECF) arrangement marks a critical inflection point in the country’s economic management. It is not merely a technocratic decision about financing or programme design; it is a political, economic, and institutional statement about where Zambia believes it stands after four years of painful adjustment—and where it wants to go next. The statement by the Minister of Finance and National Planning, Honourable Dr. Situmbeko Musokotwane, provides both reassurance and provocation: reassurance that the reform path remains intact, and provocation in that it forces the nation to interrogate whether IMF-supported stability has meaningfully translated into broad-based development.
At face value, Zambia’s IMF story since 2022 is one of rare discipline. Unlike previous engagements that collapsed under fiscal indiscipline, political interference, or reform fatigue, the current ECF programme has run its full course, culminating in a sixth and final review expected to conclude in January 2026. This alone is significant. Zambia has completed all programme reviews without interruption, met quantitative performance criteria, and delivered on structural benchmarks. In IMF terms, this places Zambia among the better-performing programme countries, especially in Sub-Saharan Africa, where stop-start engagements are common.
The macroeconomic outcomes cited by the Minister are not trivial. Primary fiscal surpluses exceeding 2 percent of GDP signal a decisive break from the culture of chronic deficits and uncontrolled borrowing that pushed Zambia into default in 2020. Inflation, once spiralling into double digits, is projected to return to the 6–8 percent target range, while growth is expected to exceed 5 percent. Foreign exchange reserves have improved, fiscal and external buffers have been rebuilt, and confidence—particularly among cooperating partners and investors—has been partially restored. These are real gains, not rhetorical ones.
Yet, Zambia’s decision not to extend the current ECF by one year, but instead to negotiate a full successor programme, deserves closer scrutiny. On the surface, the government’s explanation is logical: the current programme is complete, and the next phase requires a different emphasis—less on firefighting and more on growth, investment, and job creation. However, this choice also implicitly acknowledges a deeper truth: macroeconomic stabilisation, while necessary, has not been sufficient to resolve Zambia’s structural development crisis.
The lived experience of most Zambians remains defined by high cost of living, unemployment—particularly among the youth—and limited economic opportunity outside mining and government spending. Fiscal consolidation has restored credibility, but it has also come at a social cost. Subsidy rationalisation, expenditure restraint, and tax administration reforms, while economically defensible, have tested public patience. In this context, a successor IMF programme that looks suspiciously like a continuation of austerity, even under a “growth” label, would risk eroding the political and social legitimacy of reform itself.
Dr. Musokotwane is therefore careful to frame the next IMF engagement as a transition—from stabilisation to growth. This is a critical pivot. The success of the next programme will not be judged by balanced spreadsheets alone, but by whether it meaningfully expands Zambia’s productive capacity. Growth must be investment-led, diversification-driven, and employment-intensive. Mining revival, buoyed by favourable copper prices and policy consistency, is an important anchor, but it cannot be the sole engine. Zambia’s vulnerability to commodity cycles is precisely what necessitated IMF intervention in the first place.
Equally important is the unresolved issue of debt restructuring. While progress has been made under the G20 Common Framework, Zambia’s debt story is not fully closed. A successor programme that continues to anchor debt sustainability is therefore unavoidable. However, debt sustainability must not become a euphemism for perpetual underinvestment in human capital, infrastructure, and industrial capacity. The challenge for Zambia—and for the IMF—is to reconcile prudence with ambition.
The Minister’s insistence on national ownership of reforms is both politically astute and economically necessary. IMF programmes fail most spectacularly when they are perceived as externally imposed. By emphasising that reforms are not contingent on “any single external arrangement,” the government is attempting to reframe the IMF from a master to a partner. This narrative matters, especially as Zambia heads into an electoral cycle where IMF programmes are easily weaponised by populist rhetoric.
Still, national ownership must be demonstrated, not declared. It requires discipline beyond IMF surveillance, especially during the transition period before a new programme is approved. Adherence to parliamentary budget ceilings, prudent borrowing, and transparent mineral revenue management will be the real tests. Any slippage—particularly politically motivated spending ahead of elections—would quickly unravel the credibility Zambia has painstakingly rebuilt.
Ultimately, Zambia’s quest for another IMF-supported ECF is a paradox of success. The country is returning to the Fund not because it failed, but because it recognises that stability without transformation is fragile. The next programme must therefore be qualitatively different. It must tackle structural bottlenecks—energy security, agricultural productivity, industrial policy coherence, skills development, and institutional efficiency—while safeguarding macroeconomic discipline.
If the first ECF was about rescuing Zambia from the brink, the next must be about ensuring that the country never returns there. Anything less would confirm the long-standing critique that IMF programmes stabilise economies but fail to develop them. Zambia now has an opportunity—not guaranteed, but real—to prove that sustained reform, when paired with deliberate growth strategy, can finally break the cycle of crisis, adjustment, and relapse.
The successor IMF programme will thus not only judge Zambia’s economic policy—it will judge its economic maturity.
