65 Views The Ministry of Finance and National Planning is set to present a mid-year review of Zambia’s economy soon, as government, business and citizens assess how the 2026 budget is performing six months into the year. This will be done during the presentation of the quarter 2 (Q2 2026 Budget, Economic Performance and Outlook […]

65 Views

The Ministry of Finance and National Planning is set to present a mid-year review of Zambia’s economy soon, as government, business and citizens assess how the 2026 budget is performing six months into the year.

This will be done during the presentation of the quarter 2 (Q2 2026 Budget, Economic Performance and Outlook Townhall Meeting at the Mulungushi International Conference Centre.

The meeting was initially set for 23 July but has been postponed to a date to be announced.

Key speakers include Secretary to the Treasury Felix Nkulukusa, Statistician General Sheila S. Mudenda, Bank of Zambia Governor Denny Kalyalya and ZRA Commissioner General Dingani Banda.

Apparently, for critics the timing for this stock take meeting is critical, with the General Election set for August 13, the townhall has been viewed as government’s chance to show whether economic reforms are translating into relief for households, and to set the tone for the second half of the year.

Mid-year budget performance will be the headline item taking into account that the 2026 National Budget was anchored on growth, debt sustainability, job creation and social protection.

At the halfway mark, officials are expected to report on expenditure execution, with a focus on capital projects, agriculture inputs, health and education.

Economic analysts will be watching closely for any signs of fiscal slippage as election spending ramps up.

Also a key element is revenue collection, as the Zambia Revenue Authority has been under pressure to meet ambitious targets without hurting businesses.

ZRA’s performance in the first half will indicate whether domestic resource mobilization is holding up despite slow consumer spending. Key drivers include VAT, company tax, and customs duties from copper and other exports.

Any shortfall could force government to either cut spending or borrow more in the last quarter before elections.

Be that as it may, inflation remains the issue most Zambians feel directly. Prices of mealie meal, fuel, electricity and transport have stayed elevated for much of 2026, driven by global oil prices, a depreciating kwacha earlier in the year, and climate shocks that affected maize output.

The Statistician General’s update is expected to show whether inflation has started to ease. Bank of Zambia has kept the policy rate tight to anchor prices, but that has also kept borrowing costs high for businesses.

The central bank is likely to give its own forecast on whether inflation can return closer to the 6 to 8 percent target band by year end.

On debt, Zambia remains in the post-restructuring phase after completing its Eurobond and bilateral debt deals in the last two years.

Government has committed to keeping the debt-to-GDP ratio on a downward path. The townhall was expected to provide an update on debt service payments in the first half, disbursements from cooperating partners, and progress on projects financed through concessional loans. With elections approaching, markets and rating agencies will be looking for reassurance that fiscal discipline will not be abandoned for populist spending.

At the moment it seems the broader economic growth picture is mixed. Mining has been supported by higher copper prices and increased output from new and expanded mines. Agriculture had a difficult season in some parts of the country due to erratic rains, but government’s support through FRA and input programs is expected to feature in the review. Manufacturing and services have been constrained by power supply challenges and the high cost of doing business, but industrialization under the 8th National Development Plan remains a policy anchor.

For business, the outlook hinges on three things: stability, power, and policy predictability. The Chamber of Commerce and other private sector groups have called for clarity on tax policy, faster payment of arrears to suppliers, and measures to reduce the cost of energy. ZESCO’s load management schedule continues to affect production, and any update from ERB and the Ministry of Energy will be watched.

Social protection is also in focus. With the cost of living a major election issue, government is expected to outline how programs like Social Cash Transfer and the Food Security Pack are being funded in Q3 and Q4. President Hakainde Hichilema has himself acknowledged public frustration over hunger and prices, saying trouble comes quickly when citizens go hungry. That puts pressure on the Ministry to show concrete mitigation measures.

The election adds another layer. Typically, pre-election periods see increased government spending and tighter revenue performance. Economists say the challenge for the Ministry of Finance will be to balance political demands with the need to stay within the fiscal framework agreed with the IMF under the Extended Credit Facility. Any deviation could affect donor support and investor confidence.

Despite the postponement of the townhall, stakeholders expect the data to be released soon. Investors, donors and voters all want the same thing: evidence that the economy is stabilizing and that the tough reforms of the last three years are starting to deliver.

The second half of 2026 will therefore be a test. Can revenue hold, can inflation fall, can debt remain sustainable, and can growth be inclusive enough to matter at household level? The answers will shape not only the budget execution for the rest of the year, but also the economic narrative heading into the August 13 vote.

For now, all eyes are on Lusaka for the rescheduled townhall, where government will lay out its scorecard and its plan for the final stretch of 2026.