Zambia Needs Supplementary Budget to Balance Costs, Navigate Potential Emerging Shocks
Zambia may require a supplementary budget right before the dissolution of Parliament due to converging structural and external pressures being currently observed.
The operationalization of 70 additional seats in the National Assembly of Zambia introduces permanent recurrent costs, including salaries, allowances and constituency operations, estimated at slightly over K140 million annually, following bill 7 parliamentary passage.
However, this clearly represents a structural fiscal obligation requiring lawful appropriations.
Simultaneously, escalating geopolitical tensions around the Strait of Hormuz threaten global oil supply stability.
Higher crude prices would increase Zambia’s fuel import bill, raise foreign exchange demand, pressure the Kwacha and potentially weaken revenue performance ratios.
Once Parliament dissolves in May, expenditure ceilings cannot be expanded without legislative approval, despite the Executive remaining in caretaker capacity, though understanding that the constitutional mandate has a leeway to work out but parliamentary system of approval could be considered as a more safer way to fiscal discipline.
To preserve macroeconomic credibility under the International Monetary Fund program, fiscal recalibration before dissolution would signal prudence, protect stability and maintain investor confidence amid rising uncertainty.
