FinMin Musokotwane on Zambia’s debt restructuring process, roadmap for economic recovery

Zambia has been navigating through a challenging economic landscape due to mounting debt, a situation that has led to negotiations with various creditors. Zambia's Finance Minister, Situmbeko Musokotwane, shed light on the country's approach to addressing its debt challenges and outlined plans for economic recovery in an exclusive interview with CNBC Africa. Minister Musokotwane highlighted the progress made in negotiations with creditors, including the Chinese and official creditors represented by the Paris Club. He emphasized the importance of establishing credibility with creditors, especially following the International Monetary Fund's (IMF) endorsement of Zambia's debt management efforts. The Finance Minister expressed confidence in constructive engagement with creditors to secure a sustainable debt restructuring agreement. Regarding the timeline for concluding negotiations, Minister Musokotwane outlined a roadmap that aims to finalize discussions with most creditors by the end of April. This milestone will pave the way for formal agreements with the IMF expected around May and June. The government is conducting a debt sustainability analysis to determine the financial support needed for sustainable debt management. When discussing negotiations with creditors, Minister Musokotwane highlighted the cooperative approach taken by the Zambian government to address economic reforms and enhance business partnerships. The Minister's optimistic outlook extends to the potential for Zambia to capitalize on rising commodity prices, particularly in copper production. In aligning with global trends towards green energy, Zambia seeks to leverage its copper resources for sustainable economic growth. Minister Musokotwane emphasized the country's commitment to enhancing the value chain of copper production and attracting investments in key sectors like automotive manufacturing. By fostering partnerships with international companies, Zambia aims to position itself as a competitive player in the electric vehicle market. Furthermore, the government is focusing on expanding agricultural activities by welcoming investments in large-scale farming ventures. Zambia's strategic location and favorable climate conditions present opportunities for agricultural development, including potential collaborations with international stakeholders. Minister Musokotwane projected a GDP growth of between three and four percent for 2022, reflecting a positive trajectory from previous years of economic contraction. The Finance Minister's pragmatic outlook is grounded in realistic targets set to drive Zambia's economic recovery and long-term sustainability. As Zambia navigates through debt restructuring and embarks on a path to economic revitalization, Minister Musokotwane's leadership underscores the government's commitment to fostering growth and stability in the country's economy. By engaging with creditors, pursuing sectoral reforms, and seizing opportunities in key industries, Zambia aims to position itself as a resilient and competitive player in Africa's economic landscape.