Little Hope Of IMF Deal Ahead Of Elections

As the PF Government once again tries for a deal with the International Monetary Fund (IMF) to shore up the ailing economy, analysts have warned that it is likely to be too late in the day for a deal before upcoming elections. 

An article published Thursday by The Africa Report cites expert opinions on the attempts to secure a support packaging as talks are scheduled to continue until March 3. According to the piece analyst Indigo Ellis of Africa Matters has warned that such a deal would be highly unlikely before elections. 

“Despite pleas to the contrary, we continue to believe Lungu is incapable of selling the wide-scale reforms needed to the Patriotic Front (PF) and his electorate,” Ellis is quoted as stating.  

Nick Branson of Gondwana Risk also claims that the discussions come “too late in the political cycle” to deliver results before the August polls, describing the talks as being “on a road to nowhere.” 

Analysts suggest that President Lungu is unlikely to have the stomach for the necessary tough decisions and changes that would be needed in order to convince the IMF that the Government is serious about tackling its debt problem once and for all.  

However, the situation has become urgent with external debt now standing at around the $12 billion mark. While President Lungu has recently attempted to shift blame onto the coronavirus pandemic, even before the virus hit, debt had more than doubled during President Edgar Lungu’s time in office, growing from $4.8 billion in 2014 to $11.8 billion in 2019.  In fact, Zambian economist Grieve Chelwa estimates that total external debt has grown 1,000% since the Patriotic Front came to power in 2011.    

Analysts have also warned that in the absence of such a deal Zambia could rely further on opaque lending from China instead.