WASHINGTON, December 16, 2022 – Today, World Bank Group President David Malpass met with President Hakainde Hichilema of Zambia.
President Malpass and President Hichilema discussed with concern the slow pace of the Zambia’s debt restructuring process under the G20 Common Framework, which Zambia requested in February 2021. President Malpass and President Hichilema agreed that delays in the conclusion of the restructuring process create the urgent need to increase the international community’s support to Zambia at concessional terms. President Malpass was glad to mention the upcoming disbursement of WBG budget support to Zambia of $100 million to support the Macroeconomic Stability, Growth and Competitiveness Program. This new disbursement would bring total WBG disbursements to Zambia to $850 million between July 2021 and December 2022.
President Malpass commended Zambia’s commitment to prudent fiscal policy and greater transparency on debt management and reporting. President Malpass and President Hichilema also discussed Zambia’s progress on structural reforms, including those pertaining to the judiciary, rule of law, and a business enabling environment. President Malpass and President Hichilema discussed the importance of sustaining these reforms to achieve macroeconomic stability and lay the foundation for sustainable growth. President Malpass and President Hichilema addressed the World Bank Group’s (WBG) portfolio in Zambia, focusing on the importance of projects to improve agricultural productivity, as well as road and energy infrastructure.
President Malpass reiterated the WBG’s strong support for a prompt conclusion to the debt treatment process for Zambia under the G20 Common Framework. President Malpass emphasized the importance of achieving deep debt reduction that is in line with the Joint WB-IMF Debt Sustainability Analysis, which includes a cash debt relief from debt restructuring amounting to $8.4 billion during the period 2022-25, as well as additional debt relief over 2026–2031 to reduce the risk of debt distress to “moderate” and to sustain this level over the medium term. President Malpass and President Hichilema discussed the importance of addressing penalty interest and interest payments on arrears as part of Zambia’s debt restructuring discussions.