Zambia May Have Borrowed Too Much to Tap IMF Coronavirus Funds

Zambia’s request for emergency coronavirus funding from the International Monetary Fund may be scuppered because of the southern African nation’s growing debt burden, Bloomberg News reported. The Washington-based lender last year cautioned that the nation’s borrowing was on an unsustainable path. And now, even as the fund makes as much as $100 billion available to member countries, the IMF warned it won’t lend money to governments if it’s not sure it will be repaid. “In cases where the debt is unsustainable, the member must take steps to restore debt sustainability in order to access fund financing,” the IMF said in response to questions about whether Zambia’s borrowing could hinder its access. “This could require the government to strike a balance of fiscal adjustment that protects critical social spending and debt relief.” The global economic crisis the pandemic has caused is exacerbating existing economic risks in Africa’s second-biggest copper producer. Read more

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