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Mutati hopes for last minute deal with IMF

FINANCE minister Felix Mutati is hoping to pull a last minute deal with the International Monetary Fund (IMF) before the end of the Spring Meetings this week.

 

Mutati is leading a delegation of Zambian economic team seeking a US $1.6 billion interest-free loan from IMF to help deal with the country’s waning economy but conditions are proving problematic for Zambia.

 

Sources said the IMF was worried by the deteriorating governance record in the country and clampdown on the media which was making it difficult to hold the government to account.

 

Recent attacks and incarceration of Hichilema where the police damaged part of the opposition leader’s house has unnerved the IMF.

 

“They are very particular about the protection of private property and so, they raised some concerns about the incident,” the sources said.

 

The sources explained that the IMF was particularly concerned about the slow progress of reforms to help deal with sources of revenue leakage leading to the surge in the country’s fiscal deficit which is about 10 per cent of the GDP.

 

“The arrest of Hakainde [Hichilema] did not sit well with the Fund but the minister assured them Zambia had competent judicial system to guarantee a fair hearing,” the sources said. “They are also concerned there is a lot of resistance on the part of the government reform institutions like Zesco and Zamtel that were leading to loss of vital government revenue. But Hon Mutati assured them that government is still evaluating the balance sheets of all parastatals with a view to hive-off the loss making ones.”

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