By 
Finance and National Planning Minister, Situmbeko Musokotwane, has disclosed that Zambia would have been allocating over 90 percent of its monthly budget to debt servicing if it had not restructured its debt obligations.
In December 2024, the Treasury released K12.7 billion for domestic and external debt servicing, representing 55 percent of the K23.7 billion allocated for public expenditure within the month.
Musokotwane said this in a statement issued in Lusaka on Sunday.
Of the total debt-related expenditure, K6.4 billion was directed to domestic debt service, K3.8 billion to external debt service, and K2.5 billion to clearing arrears.
The remaining K10.4 billion of the December budget releases supported public service delivery across various sectors.
Read more: Tax expenditure key to economic growth, revenue generation, says Finance Minister, Musokotwane
Minister Musokotwane emphasized the critical importance of the debt restructuring process, warning that without it, Zambia would have faced a borrowing spiral to meet essential expenditures in education, health, security, social welfare, and public sector salaries.
“The fact that 55 percent of December 2024’s budget releases went towards debt service and arrears is a stark reminder of the fiscal disaster that would have befallen the nation had we not embarked on the debt restructuring process,” he said while reviewing the December expenditure report.
He also highlighted progress in securing comprehensive debt treatment agreements. Memoranda of Understanding signed with France and Saudi Arabia in December 2024 have paved the way for finalizing 14 additional agreements with other creditor nations.
“These agreements will ensure Zambia’s economic recovery efforts in 2025 and beyond, enabling us to finance developmental programmes using domestic resources,” Musokotwane added.
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.
Comments