Zambia: IMF puts bailout talks on hold

The International Monetary Fund (IMF) has said it has temporarily halted bailout talks to allow the Zambian government to put public debt on a sustainable path.

Zambia is seeking a $1.3 billion bailout from the IMF.

"The talks were put on hold after providing new information on government’s external borrowing plans needed to be reconciled key program objective of putting the debt on a sustainable path,” IMF resident representative Alfredo Baldini told journalists on Thursday afternoon. He also dismissed claims that former IMF country mission chief Tchidi Tsikata had been replaced for failing to close the deal with the Zambian government.

Baldini also expressed concern with the pace at which Zambia’s public debt was contracting, saying this would put Zambia at high risk of debt distress.While acknowledging Zambia’s need to address infrastructure gaps needed to maintain debt sustainability, Baldini suggested it was critical for Zambia to slow down on the contraction of new debt.

The newly appointed mission chief to Zambia is Baileau Loko, the IMF announced earlier this week.

Zambia has been seeking a bailout since 2014.