Zambia’s 2025 Budget: Building Resilience, Stimulating Growth, and Ensuring Inclusive Development

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The 2025 Budget Speech delivered by Honourable Dr. Situmbeko Musokotwane, Zambia’s Minister of Finance and National Planning, outlined key aspects of the country’s budgetary allocations, policy priorities, and economic objectives for the year. Here are the main highlights:

Theme:

The budget is focused on “Building resilience for inclusive growth and improved livelihoods.” It aims to foster economic recovery from a severe drought in 2024 and stimulate inclusive growth while building resilience to future shocks.

Economic Recovery and Growth:

  • Zambia’s economy is projected to grow by 6.6% in 2025, driven by recovery in agriculture, mining, and other key sectors such as ICT, tourism, and construction.
  • Inflation is targeted to reduce to the 6-8% range from the current high of 15.6% due to the drought-related food shortages and Kwacha depreciation.
  • Debt restructuring is key to creating fiscal space, with notable progress made in negotiations with international creditors.

Major Allocations:

  • Total expenditure: ZMW 217.1 billion, representing 26.6% of GDP.
  • 80.2% of the budget will be financed by domestic revenue, with the rest coming from external borrowing and grants.
  • Debt servicing: Domestic debt (ZMW 37.3 billion) and external debt (ZMW 16.7 billion) form a significant portion of the budget.

Key Sectors:

  • Agriculture: ZMW 15.4 billion allocated, with ZMW 9.3 billion for the Farmer Input Support Programme to ensure food security.
  • Infrastructure: ZMW 12 billion for road construction and rehabilitation, with a focus on PPPs for key projects such as the Lusaka-Ndola dual carriageway.
  • Education: ZMW 31.5 billion, with free education continuing and substantial investments in school infrastructure and teacher recruitment.
  • Health: ZMW 23.2 billion, focusing on expanding healthcare infrastructure, medical supplies, and hiring more healthcare professionals.
  • Social Protection: ZMW 16.2 billion for programs like Social Cash Transfers and Food Security Pack.

Resilience and Sustainability:

The budget includes initiatives for climate change adaptation, such as expanding solar power, irrigation projects, and investment in green energy sources to reduce reliance on hydropower.

This budget seeks to strengthen Zambia’s economic fundamentals while responding to the immediate challenges posed by the drought, with a long-term focus on creating inclusive, sustainable growth.

View Budget Address

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