Zambia’s Current Debt Position Show Positive Posture
Zambia’s public debt burden remains a central challenge to economic recovery and long-term fiscal stability.
As of mid-2025, the total public and publicly guaranteed debt stands at approximately US$25.3 billion, with the debt-to-GDP ratio approaching 97%.
While this mentioned above reflects a nominal reduction from previous highs, the economy’s limited growth has amplified the debt’s relative weight.
The government has made notable strides in debt restructuring process particularly through successful agreements with bilateral creditors and Eurobond holders, yielding short-term cash flow relief to fund critical essentials on our public expenditure columns.
However, concerns persist around rising domestic borrowing, which has grown to K225 billion and outstanding domestic arrears of over K77 billion, which continue to crowd out private sector investment and place pressure on service delivery, coupled with the appetite to be drawn to facilitate supplementary budget for 2025.
Alarmingly, over 55% of public expenditure in recent months has been directed toward debt servicing. This trend raises serious questions about the sustainability of current fiscal operations and the need for deeper reforms in expenditure controls, domestic revenue mobilization, and debt management frameworks.
Zambia’s economic future hinges on continued fiscal consolidation, resolution of outstanding creditor negotiations including with “baby multilaterals” and a clear strategy to stimulate productive investment that drives growth. Only through disciplined policy actions can Zambia return to a path of sustainable debt levels and inclusive development.
