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Zambia: Raising tax collection should help turn around economy, says analyst

By David Whitehouse
Posted on Tuesday, 16 March 2021 15:04

The end of a consultation period between Zambia and the International Monetary Fund (IMF) this month brought a cautious signal from the fund that progress is being made following the sovereign default in November.

An IMF statement on 4 March said that “significant progress” has been made, while noting that fiscal consolidation – cutting spending and collecting more tax – is among the key remaining challenges.

Finance minister Bwalya Ng’andu said the government is committed to securing an IMF programme. But by highlighting the need for “more detailed policy steps”, the IMF is signalling that Zambia’s Economic Recovery Programme is an incomplete response to its debt crisis, argues Nick Branson, director at Gondwana Risk in London.