Government is now spending less Kwacha on servicing debt while delivering more value in dollar terms than it did a year ago. Here is how.

In May 2025, the Ministry of Finance and National Planning released K5.5 billion to service domestic and external debt and dismantle arrears. At the exchange rate of approximately K27 to the dollar prevailing then, that amount was worth approximately $203 million.

In May 2026, the same Ministry released K4.7 billion for the same purpose. At today’s exchange rate of approximately K19(May) to the dollar, K4.7 billion is now worth approximately $247 million. The Kwacha has continued strengthening into June, trading at approximately K17 to the dollar.

In other words, less Kwacha is being released, but more dollar value is being delivered. The country is settling more of its external obligations with fewer kwacha out of the treasury. That is the practical benefit of a stronger currency working in the country’s favour.

Within the May 2026 debt service total, K3 billion went to domestic debt service, K1.5 billion to external debt service obligations, and K200.2 million to clearing arrears owed to local suppliers, putting liquidity back into the productive economy.

The wider release of K16 billion for May 2026 also covered K3.7 billion for the public service wage bill, K3.6 billion for transfers and social benefits including K1.5 billion for Grant Aided Institutions and K799.7 million for school grants under the free education policy, K2.2 billion for government operations, and K1.8 billion for capital expenditure in roads and education infrastructure.