Zambia’s economy is forecast to grow 4.2% this year, according to the country’s Secretary to the Treasury, Felix Nkulukusa, on Tuesday.

However, growth is set to edge down over the previous year as the country aims to finalise a long-overdue debt restructuring.

According to preliminary data, Zambia’s economy grew by 4.7% last year, a marginal rise from the 4.6% growth registered in 2021, Nkulukusa said in a statement.

In addition, the country’s GDP growth is forecast to hit 4.8% in 2024 and 4.7% in 2025.

Back in 2020, Zambia defaulted on its debt and, since then, has struggled to reach an agreement with lenders on a relief deal. Indeed, according to policymakers, the delays were impacting investment and driving up inflation, Reuters news agency reports.

At the end of March this year, Zambia’s public and publicly guaranteed debt were $25.4 billion, the Secretary to the Treasury went on to add, with central government external debt rising by 1.0% to $14.09 billion from $13.96 billion at the end of 2022, he continued.

“The increase in debt stock was largely on account of disbursements received from multilateral creditors for budget support and project loans,” he stated.

The Zambian government is aiming to bring down inflation to within the central bank’s target range of between 6% and 8% by the end of this year, the Reuters report adds. The government is also planning to achieve a fiscal deficit of not more than 7.7% of the country’s GDP, the statement added.

Furthermore, Zambia’s inflation increased to 10.2% in April, compared to March’s figure of 9.9%, the first time it has reached double figures since May last year.