The International Monetary Fund (IMF) USD1.3 billion possible funded program remain uncertain because of unsustainable levels of debt which the Fund say have had no investment returns on the economy or towards debt servicing.
An IMF team that was in the country has expressed concern over the huge debt levels contracted by the Patriotic Front (PF) Government which are not yielding any tangible returns on the economy.
The team has also expressed concern on the high levels of corruption within the government which has led to some donors withdrawing aid from the country.
The team that has met the Zambian government, the parliamentary committee on Economic Affairs, and some selected Civil Society organisations is reportedly unhappy that the loans government had obtained were not paying off to facilitate repayment or economic growth in the country.
“While the loan contraction is high, there are no returns towards debt repayment or economic growth,” a source close to the delegation has hinted.
The IMF team was in the country to assess the progress made by the government on various economic fronts for the bail out package.
According to sources the IMF team was also concerned with the increased reports of public resources that are reportedly being abused and stolen by government officials.
The team is also reportedly concerned about government’s decision to introduce the Sales Tax in the 2019 National Budget as opposed to the Value Added Tax.
The best option, according to the source was to maintain the Value Added Tax (VAT) and broaden the tax scope to ensure that more revenues are collected.
The team is also concerned about the the entire governance situation in Zambia and the ‘deteriorating’ human rights situation in the country.
The IMF had suspended discussions on the possible bail out program.