Zambia Replaces Finance Minister as Country Seeks IMF Loan
(Bloomberg) -- Zambian President Edgar Lungu replaced his finance minister as Africa’s second-largest copper producer seeks to secure a $1.3 billion loan from the International Monetary Fund. Yields on its dollar debt rose.
Margaret Mwanakatwe, previously commerce minister, was appointed to the post, replacing Felix Mutati, who will take the works and supply portfolio, the presidency said Wednesday in an emailed statement. Richard Musukwa replaces Christopher Yaluma as mines minister, with Yaluma heading the Commerce Ministry.
Mutati was key in negotiations between the southern African nation and the IMF for the long-delayed loan. The appointment of Mwanakatwe could prove pivotal after talks stalled last year, according to Chibamba Kanyama, a Zambian economist who was previously a communications adviser with the Washington-based lender.
“It’s either a deal-breaker or a deal-maker,” Kanyama said by phone. “The next two weeks will determine how the IMF discussions go” and whether the parties decide to “re-engage afresh,” he said.
Lungu also appointed Emmanuel Pamu as permanent secretary in the Finance Ministry in charge of budgetary and economic affairs, replacing Pamela Kabamba, the presidency said Thursday. Pamu was previously an economics director at the central bank.
Yields on Zambia’s $1 billion Eurobonds due 2024 climbed for a third day to the highest since August at 7.44 percent by 12:33 p.m. in Lusaka. The bonds fell as much as 2 percent after the announcement of the removal of Mutati, who’d helped stabilize the economy and the fiscal deficit since taking up the job in 2016.
Zambia’s debt has been climbing rapidly, and earlier this week the presidency announced the country was seeking to restructure its loans with China, which has funded billions of dollars in roads, airports and power-generation projects.
Mwanakatwe is a chartered accountant and has worked for banks including Barclays Africa Group Ltd. and United Bank for Africa.
Lungu also replaced Energy Minister David Mabumba with Mathew Nkhuwa. The cabinet reshuffle was the biggest since the president won another term in 2016.
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