Public Debt Management Act, 2022

THE PUBLIC DEBT MANAGEMENT ACT, 2022
ARRANGEMENT OF SECTIONS
Section
PART I
PRELIMINARY
1. Short title
2. Interpretation
3. Government debt management objectives
4. Medium Term Debt Strategy
PART II
DEBT MANAGEMENT OFFICE
5. Establishment of Debt Management Office
6. Functions of Debt Management Office
7. Director and other staff
PART III
ANNUAL BORROWING PLAN
8. Annual borrowing plan
9. Review of annual borrowing plan
10. Update on implementation of annual borrowing plan
PART IV
GENERAL BORROWING POWERS
11. Power to raise loans
12. Purpose of loans
13. Methods of raising loans
14. Suspension of approval by National Assembly in state of emergency
15. Establishment of Special Deposit Account
16. Application and deposit of loan proceeds
17. Supplier’s credit, export credit and finance lease agreement
18. Repayment, conversion and consolidation of loans
19. Debt charge
20. Agents to issue or raise bonds, stock or treasury bills
21. Power to grant loans out of Consolidated Fund
Public Debt Management [No. 15 of 2022 397
Single copies of this Act may be obtained from the Government Printer,
P.O. Box 30136, 10101 Lusaka, Price K44.00 each.

Management [No. 15 of 2022 397
Single copies of this Act may be obtained from the Government Printer,
P.O. Box 30136, 10101 Lusaka, Price K44.00 each.

PART V
BORROWING BY PUBLIC BODIES
22. Borrowing by public body
23. Loans by public body requiring National Assembly approval
24. Reporting requirements for public body
PART VI
SINKING FUNDS
25. Establishment of sinking funds for redemption of bonds or stock
26. Establishment of sinking funds in other cases
27. Contribution to sinking fund
28. Withdrawal of money from sinking fund
29. Deficiency in sinking fund to be charged on Consolidated Fund
30. Regulations for sinking funds
PART VII
GUARANTEES AND INDEMNITIES
31. Power to give guarantees
32. Approval of guarantee by National Assembly
33. Payment of guarantee fee
34. Maximum amount of guarantees
35. Beneficiary to reimburse all costs
36. Indemnities
37. Guarantees and indemnities to be paid out of the Consolidated Fund
PART VIII
POWER TO RAISE GRANTS
38. Power to raise grants
39. Purpose of grants
PART IX
REPORTS
40. Debt sustanability analysis
41. Debt statistical bulletin
42. Annual public debt, guarantees and grants execution report
398 No. 15 of 2022] Public Debt Management

ility analysis
41. Debt statistical bulletin
42. Annual public debt, guarantees and grants execution report
398 No. 15 of 2022] Public Debt Management

PART X
GENERAL PROVISIONS
43. General restriction on raising of loans
44. Minister and other person not responsible for fulfilment of trusts
attaching to bonds, stocks or treasury bills
45. Minister may delegate functions to public officer
46. Financial misconduct by public officer or controlling body
47. Disciplinary proceedings
48. Offence by principal officer, shareholder or partner of body corporate
or unincorporate body
49. Regulations
50. Repeal of Cap. 366 and Cap. 350 and Savings and transitional
arrangements
SCHEDULES
Public Debt Management [No. 15 of 2022 399

ody
49. Regulations
50. Repeal of Cap. 366 and Cap. 350 and Savings and transitional
arrangements
SCHEDULES
Public Debt Management [No. 15 of 2022 399

An Act to provide for the raising of loans and grants; the
issuing of guarantees; the approval of loans by the National
Assembly; the issuing of loans by or on behalf of the
Government; the establishment of sinking funds; the
establishment of the Debt Management Office and provide
for its functions; the repeal of the Loans and Guarantees
(Authorisation) Act, 1969, and the General Loan and Stock
Act, 1931; and matters connected with, or incidental to,
the foregoing. [11th August, 2022
ENACTED by the Parliament of Zambia. PART I
PRELIMINARY DIVISION
1. This Act may be cited as the Public Debt Management
Act, 2022. 2.

1th August, 2022
ENACTED by the Parliament of Zambia. PART I
PRELIMINARY DIVISION
1. This Act may be cited as the Public Debt Management
Act, 2022. 2.

In this Act, unless the context otherwise requires —
“annual borrowing plan” means a schedule of anticipated
borrowings for the Government and public bodies for a
financial year;
“Bank of Zambia” means the Bank of Zambia established
under the Constitution;
“beneficiary” means a body specified, or belonging to a class
specified, in the First Schedule, in whose favour a guarantee
is issued by the Minister;
“bond”means an interest-bearing debt instrument issued with
a maturity period of more than one year;
“central Government” has the meaning assigned to the words
in the Public Finance Management Act, 2018;
Enactment
Short title
Interpretation
Cap. 1
Act No. 1 of
2018
Public Debt Management [No. 15 of 2022 401
GOVERNMENT OF ZAMBIA
ACT
No. 15 of 2022
Date of Assent: 9th August, 2022

pretation
Cap. 1
Act No. 1 of
2018
Public Debt Management [No. 15 of 2022 401
GOVERNMENT OF ZAMBIA
ACT
No. 15 of 2022
Date of Assent: 9th August, 2022

“Consolidated Fund” means the Consolidated Fund established
under the Constitution;
“controlling body” has the meaning assigned to the words in
the Public Finance Management Act, 2018;
“debt charge” includes interest, sinking fund charges, the
repayment or amortisation of debt and expenses necessarily
incurred in connection with the raising or the repayment of
a loan in accordance with this Act;
“debt sustainability analysis” means an assessment of the
manner in which the Republic’s current level of public
debt and prospective borrowing affects the Republic’s
present and future ability to meet debt service obligations;
“Director” means the person appointed as Director of the
Debt Management Office under section 7;
“financial misconduct” has the meaning assigned to the words
in the Public Finance Management Act, 2018;
“Government debt” means financial liabilities created as a
result of borrowing by central Government;
“grant” means resource flow to a beneficiary for the
advancement of economic development, technical
cooperation or otherwise for the purpose of financing a
project or specified action, or an operational expenditure
for which no repayment is required;
“guarantee” means the potential liability assumed by the
Republic that is contingent on the financial obligation of a
beneficiary and becomes Government debt when the
beneficiary responsible for the payment of the financial
obligation fails to make payment when due;
“legally disqualified” means the absence of legal capacity as
provided in section 4 of the Mental Health Act, 2019;
“Medium Term” means a period of three to five years;
“Medium Term Debt Strategy” means a strategic plan
designed to operationalise high level objectives for debt
management, taking into account the cost and risk
associated with the public debt portfolio and the financing
of the Government’s borrowing requirements over the
medium term;
“public account” has the meaning assigned to the words in
the Public Finance Management Act, 2018;
Act No.

orrowing requirements over the
medium term;
“public account” has the meaning assigned to the words in
the Public Finance Management Act, 2018;
Act No.

6 of
2019
Act No. 1 of
2018
Cap. 1
Act No. 1 of
2018
Act No. 1 of
2018
402 No. 15 of 2022] Public Debt Management

6 of
2019
Act No. 1 of
2018
Cap. 1
Act No. 1 of
2018
Act No. 1 of
2018
402 No. 15 of 2022] Public Debt Management

“public body” means a local authority, parastatal, State-owned
enterprise, Commission or other body appointed by the
Government or established by or under any written law,
but excludes a professional association or body, and “public
bodies” shall be construed accordingly;
“public debt” means a financial liability created as a result of
borrowing by Government, a local authority, parastatal,
State owned enterprise, or other body appointed by the
Government or established by or under, any written law,
but excludes a professional association or body;
“public funds” has the meaning assigned to the words in the
Public Finance Management Act, 2018;
“public officer” has the meaning assigned to the words in the
Constitution;
“repealed Acts” means the Loans and Guarantees
(Authorisation) Act and the General Loan and Stock Act;
“sinking fund” means a fund established under sections 25
and 26;
“Special Deposit Account” means an account established
under section 15 which consists of a Government bonds
proceeds account, treasury bills proceeds account and any
other account for purposes of depositing loan proceeds
raised in accordance with this Act; and
“Treasury” has the meaning assigned to the word in the Public
Finance Management Act, 2018.

ting loan proceeds
raised in accordance with this Act; and
“Treasury” has the meaning assigned to the word in the Public
Finance Management Act, 2018.

3. The Government shall, in the management of debt over
the medium to long term—
(a) meet Government’s financing needs in a timely manner;
(b) minimise the borrowing costs in accordance with a prudent
degree of risk; and
(c) promote the development of the domestic financial market. 4. (1) The Minister shall cause the preparation of a Medium
Term Debt Strategy for the management of Government debt, in
accordance with section 3, for Cabinet consideration and approval. (2) The Medium Term Debt Strategy shall take into account
the determined fiscal strategy and macroeconomic framework, and
include—
(a) the risk embedded in the current Government debt portfolio;
(b) future borrowing requirements of the Government; and
(c) prevailing market conditions and guidelines for acceptable
market risks in the debt portfolio and planned borrowings. Act No. 1 of
2018
Cap. 1
Cap. 366
Cap. 350
Act No. 1 of
2018
Government
debt
management
objectives
Medium
Term Debt
Strategy
Public Debt Management [No. 15 of 2022 403

Cap. 1
Cap. 366
Cap. 350
Act No. 1 of
2018
Government
debt
management
objectives
Medium
Term Debt
Strategy
Public Debt Management [No. 15 of 2022 403

(3) Subject to Cabinet approval, the Minister shall, update the
approved Medium Term Debt Strategy at least once a year on a
rolling basis. (4) The Minister shall cause to be published the approved
Medium Term Debt Strategy in a manner that the Minister considers
necessary by the second Friday of July in each year. PART II
DEBT MANAGEMENT OFFICE
5. There is established, within the ministry responsible for
finance, a Debt Management Office which is responsible for public
debt management. 6.

ICE
5. There is established, within the ministry responsible for
finance, a Debt Management Office which is responsible for public
debt management. 6.

The functions of the Debt Management Office are to—
(a)conduct debt management operations of the Government;
(b) conduct credit risk assessment of Government guarantees
and loans issued out of the Consolidated Fund;
(c) formulate the Medium Term Debt Strategy;
(d) conduct annual debt sustainability analysis;
(e) maintain and keep an updated database of outstanding
public debt and guarantees;
(f) prepare an annual borrowing plan;
(g) monitor and evaluate all borrowing and debt related
transactions to ensure compliance with the medium term
debt strategy;
(h) conduct a credit risk assessment of a public body that
intends to borrow money or issue a guarantee in
accordance with section 22;
(i) keep and maintain a record of loan contracts, other debt
contracts related to Government debt and guarantee
contracts;
(j) negotiate a loan, other debt contracts or a guarantee
contract on behalf of the Government;
(k) prepare the annual public debt, guarantees and grants
execution report in accordance with section 42; and
(l) perform any other functions necessary for this Act as the
Minister may prescribe. 7.

nd grants
execution report in accordance with section 42; and
(l) perform any other functions necessary for this Act as the
Minister may prescribe. 7.

(1) The Civil Service Commission shall appoint as a public
officer, a Director who is responsible for the day-to-day
administration of the Debt Management Office under the general
direction of the Permanent Secretary of the Ministry responsible
for finance. Establishment
of Debt
Management
Office
Director and
other staff
Functions of
Debt
Management
Office
404 No. 15 of 2022] Public Debt Management

nance. Establishment
of Debt
Management
Office
Director and
other staff
Functions of
Debt
Management
Office
404 No. 15 of 2022] Public Debt Management

(2) The Civil Service Commission shall appoint public officers
and other staff that may be necessary for the performance of the
functions of the Debt Management Office. PART III
ANNUAL BORROWING PLAN
8. (1) The Debt Management Office shall prepare and submit
to the Minister an annual borrowing plan. (2) An annual borrowing plan prepared under subsection (1)
shall take into account—
(a) the Medium Term Debt Strategy prepared under section
4; and
(b) the cashflow forecast for the financial year in respect of
which the annual borrowing plan is prepared. (3) The annual borrowing plan shall consist of—
(a) the total borrowing needs for the next financial year;
(b) the purpose of the loans to be contracted;
(c) debt instruments to be used;
(d) broad terms of the borrowings;
(e) the indicative timing of the borrowing operations;
(f)the maximum limit that the Government intends to borrow
in that financial year; and
(g) the overall net increase or decrease in public debt. (4) The Minister shall, not later than ninety days before the
commencement of the next financial year, lay the annual borrowing
plan before the National Assembly in each financial year.

han ninety days before the
commencement of the next financial year, lay the annual borrowing
plan before the National Assembly in each financial year.

(5) The Minister shall, within ninety days of the swearing in of
the President, in a year where a general election is held, lay the
annual borrowing plan before the National Assembly. (6) The National Assembly shall, by resolution of the Members
of Parliament, approve the annual borrowing plan for the next
financial year. (7) Approval of the annual borrowing plan by the National
Assembly shall constitute an approval of the loans contained in the
annual borrowing plan in that financial year. 9. The Minister shall review the annual borrowing plan where
the Minister considers it necessary and submit the revised annual
borrowing plan for approval by the National Assembly. Annual
borrowing
plan
Public Debt Management [No. 15 of 2022 405
Review of
annual
borrowing
plan

borrowing plan for approval by the National Assembly. Annual
borrowing
plan
Public Debt Management [No. 15 of 2022 405
Review of
annual
borrowing
plan

10. The Minister shall submit, on a bi-annual basis, to the
National Assembly an update on the implementation of the annual
borrowing plan. PART IV
GENERAL BORROWING POWERS
11. (1) The Minister shall have the sole authority to raise loans
on behalf of the Republic. (2) The Minister may raise loans that the Minister considers
necessary, within or outside the Republic, on behalf of the Republic,
except that the—
(a) amount outstanding of total Government debt borrowed
from within and outside the Republic, shall not exceed
sixty-five percent of the gross domestic product at
current market prices computed for the immediate past
financial year; and
(b) aggregate amount of the debt service cost due and payable
during a financial year for outstanding loans raised
outside the Republic shall not exceed twenty percent of
the average annual recurrent revenue computed on the
basis of the three preceding financial years. (3) The Minister shall exercise the authority under this section
in accordance with the annual borrowing plan under section 8 and
the Medium Term Debt Strategy.

nister shall exercise the authority under this section
in accordance with the annual borrowing plan under section 8 and
the Medium Term Debt Strategy.

(4) Subsections (2) and (3) shall not apply in the case of —
(a) a natural disaster;
(b) a state of war;
(c) a state of public emergency; or
(d) an exceptional expenditure in accordance with the National
Planning and Budgeting Act, 2020. (5) Despite subsection (1), where the office of the Minister is
vacant by reason of the dissolution of Parliament, the President
may—
(a) obtain a loan on behalf of the Republic; or
(b) by direction in writing, delegate to the Secretary to the
Treasury the power to obtain a loan on behalf of the
Republic. (6) Subsections (2) and (3) shall apply to an exercise of power
by the President or the Secretary to the Treasury in accordance
with subsection (5). Update on
implementation
of annual
borrowing
plan
Power to
raise loans
Act No. 1 of
2020
406 No. 15 of 2022] Public Debt Management

th subsection (5). Update on
implementation
of annual
borrowing
plan
Power to
raise loans
Act No. 1 of
2020
406 No. 15 of 2022] Public Debt Management

12. (1) The Minister may raise a loan under section 11 to—
(a) finance Government budget deficit;
(b) finance strategic national projects identified in accordance
with the National Planning and Budgeting Act, 2020;
(c) maintain a credit balance on the Treasury at a level
determined by the Minister;
(d) provide a loan to a public body or any other body;
(e) refinance outstanding debt or repay a loan;
(f) honour obligations arising from guarantees;
(g) protect, mitigate or eliminate effects caused by a natural
or environmental disaster or any other national
emergency;
(h) develop the domestic capital market; and
(i) fulfil any other purpose that the National Assembly may,
by resolution, approve. (2) A loan raised under this Act shall be used solely for the
purpose for which the loan was raised. 13. (1) Subject to the provisions of this Act, a loan may be
raised by—
(a) the issue of a bond or stock;
(b) the issue of a treasury bill; or
(c) an agreement in writing. (2) Advances to the Government under the Bank of Zambia
Act, 2022, or loans directly contracted by a public body from within
the Republic shall not require the approval of the National Assembly. 14.

Zambia
Act, 2022, or loans directly contracted by a public body from within
the Republic shall not require the approval of the National Assembly. 14.

(1) Where a state of public emergency, war or threatened
state of public emergency is declared by the President in accordance
with the Constitution, the requirement to obtain approval of a loan
from the National Assembly may be suspended with the written
approval of Cabinet. (2) Where a state of public emergency, war or threatened state
of public emergency is declared as specified under subsection (1),
the Minister shall submit a memorandum to Cabinet requesting for
approval to suspend the requirement to obtain approval from the
National Assembly to contract a loan on behalf of the Republic. (3) The Minister shall, where a loan is issued without the
approval of the National Assembly in that financial year, submit to
the National Assembly a report, during the first sitting of the National
Assembly after the cessation of public emergency, war or
Purpose of
loans
Act No. 1 of
2020
Methods of
raising loans
Act No. 5 of
2022
Suspension
of approval
by National
Assembly in
state of
emergency
Public Debt Management [No. 15 of 2022 407
Cap. 1

of
raising loans
Act No. 5 of
2022
Suspension
of approval
by National
Assembly in
state of
emergency
Public Debt Management [No. 15 of 2022 407
Cap. 1

threatened state of public emergency, containing the terms and
conditions of a loan issued during the state of public emergency,
war or threatened state of public emergency. 15. There is established a Special Deposit Account for the
purpose of administering loans under this Act. 16. (1) A loan raised under this Act for a period exceeding
one year shall be paid into the Consolidated Fund or other public
fund or public account, except that where a loan is raised under a
bond issued through the Bank of Zambia, the proceeds of that loan
shall be paid into the Special Deposit Account. (2) A loan raised under this Act for a period that does not
exceed one year shall be paid into the Special Deposit Account. (3) Despite subsections (1) and (2), a supplier’s credit
agreement, export credit agreement, project financing or finance
lease agreement entered into by the Minister on behalf of the
Republic is exempt from the application of this section. 17. (1) Subject to this Act, the Minister may enter into a
supplier’s credit agreement, export credit agreement or finance
lease agreement on behalf of the Republic.

to this Act, the Minister may enter into a
supplier’s credit agreement, export credit agreement or finance
lease agreement on behalf of the Republic.

(2) A supplier’s credit agreement, export credit agreement or
finance lease agreement under subsection (1) shall constitute
Government debt. (3) The Debt Management Office shall, before the execution
of a supplier’s credit agreement, export credit agreement or finance
lease agreement, assess the cost to the Government of entering
into the agreement and ensure that the agreement is in accordance
with the Medium Term Debt Strategy. (4) The Director shall submit the result of the assessment under
subsection (3), in writing, to the Minister. 18.

with the Medium Term Debt Strategy. (4) The Director shall submit the result of the assessment under
subsection (3), in writing, to the Minister. 18.

(1) The Minister may, with the consent of the lender and
on terms and conditions that the Minister may determine—
(a) repay a loan prior to the redemption date of that loan;
(b) extend the loan availability period;
(c) amend the tenor of an existing loan, except that the terms
and conditions of the amended loan shall not be less
favourable than the terms and conditions of the existing
loan;
(d)convert a loan into any other loan, equity or other securities
held by the Government; and
Establishment
of Special
Deposit
Account
Application
and deposit
of loan
proceeds
Supplier’s
credit,
export
credit, and
finance lease
agreement
Repayment,
conversion
and
consolidation
of loans
408 No. 15 of 2022] Public Debt Management

plier’s
credit,
export
credit, and
finance lease
agreement
Repayment,
conversion
and
consolidation
of loans
408 No. 15 of 2022] Public Debt Management

(e) consolidate two or more loans into an existing or new
loan, except that the terms and conditions of the
consolidated loan shall not be less favourable than the
terms and conditions of the existing loan. (2) The Minister shall, in exercising the powers under
subsection (1), comply with the debt management objectives under
section 3. 19. (1) A debt charge arising from the raising of a loan under
this Act shall be a charge on the Consolidated Fund. (2) Where a loan is raised for a period not exceeding one year,
the repayment or amortisation of that loan shall be paid out of the
Special Deposit Account. (3) Interest and expenses incurred in raising or repaying a loan
under this Act shall be a charge on the Consolidated Fund. (4) Subject to the Constitution, the Minister shall include in the
financial report prepared in a financial year, a statement showing
the particulars of a debt charge paid in that financial year relating
to a loan raised under this Act or any other written law. 20. (1) The Bank of Zambia shall act as the agent of the
Minister in the case of a loan raised under this Act relating to the
issue of bonds, stock or treasury bills.

of Zambia shall act as the agent of the
Minister in the case of a loan raised under this Act relating to the
issue of bonds, stock or treasury bills.

(2) Despite subsection (1), the Minister may, by statutory
instrument, where the Minister considers it necessary, appoint other
agents to issue or raise bonds. 21. (1) A loan shall not be granted out of the Consolidated
Fund except in accordance with this section or any other written
law. (2) Subject to the Constitution, the Minister shall have the sole
authority to grant loans out of the Consolidated Fund on behalf of
the Republic. (3) The Minister shall, before the grant of a loan out of the
Consolidated Fund—
(a) assess the credit risk to the Government of providing the
loan; and
(b) determine the rate of interest to cover the cost and the
credit risk of the Government. (4) The Minister shall, issue a loan out of the Consolidated Fund
where the Minister, based on the credit risk assessment, establishes
that the borrower has the financial capacity to service the loan. Debt charge
Cap. 1
Agents to
issue or raise
bonds, stock
or treasury
bills
Power to
grant loans
out of
Consolidated
Fund
Cap. 1
Public Debt Management [No. 15 of 2022 409

gents to
issue or raise
bonds, stock
or treasury
bills
Power to
grant loans
out of
Consolidated
Fund
Cap. 1
Public Debt Management [No. 15 of 2022 409

(5) A loan granted under this section shall be subject to the
terms and conditions that the Minister considers necessary. (6) The Minister shall, where a borrower neglects or fails to
service a debt obligation for a loan granted out of the Consolidated
Fund, take action necessary to recover from the borrower the
outstanding money, including interest due and payable, owed to the
Government under the agreement. PART V
BORROWING BY PUBLIC BODIES
22. (1) Subject to this Act, a public body shall not, without the
written authority of the Secretary to the Treasury, raise a loan or
issue a guarantee. (2) Subject to subsection (1), the Secretary to the Treasury shall
prior to approving a request by a public body to raise a loan or
issue a guarantee, cause the Debt Management Office to assess
the financial capacity of that public body to repay the loan. (3) A person who contravenes subsection (1), commits an
offence and is liable, on conviction, to a fine not exceeding five
hundred thousand penalty units or to imprisonment for a term not
exceeding five years, or to both.

liable, on conviction, to a fine not exceeding five
hundred thousand penalty units or to imprisonment for a term not
exceeding five years, or to both.

(4) A public body shall be liable for the debt and obligations of
that public body without recourse to Government, unless that debt
or obligation is expressly guaranteed by Government in accordance
with this Act. (5) The Bank of Zambia is exempt from the provisions of this
Part where the Bank of Zambia intends to raise a loan in the
execution of the Bank’s functions relating to monetary and
supervisory policies. 23. (1) A public body shall not raise a loan from a source
outside the Republic without the approval of the National Assembly. (2) A public body that intends to raise a loan from a source
outside the Republic shall submit to the Minister a proposed external
borrowing plan for a financial year. (3) The Minister shall, on receipt of the proposed external
borrowing plan under subsection (2), cause the Debt Management
Office to carry out a credit risk assessment. (4) The Minister shall, where the Minister is satisfied with the
credit risk assessment under subsection (3), submit to the National
Assembly a public body’s external borrowing plan together with
the annual borrowing plan in accordance with section 8. 24.

(3), submit to the National
Assembly a public body’s external borrowing plan together with
the annual borrowing plan in accordance with section 8. 24.

(1) A public body shall, not later than twenty working
days after the end of each quarter, submit to the Minister—
Borrowing
by public
body
Loans by
public body
requiring
National
Assembly
approval
Reporting
requirements
for public
body
410 No. 15 of 2022] Public Debt Management

ublic
body
Loans by
public body
requiring
National
Assembly
approval
Reporting
requirements
for public
body
410 No. 15 of 2022] Public Debt Management

(a) a statement of the total outstanding debt and borrowing
operations of a public body; and
(b) any other information relating to the public body’s debt,
that the Minister may determine. (2) Despite subsection (1), the Minister may request for
the submission of records by a public body under subsection (1) at
any time. PART VI
SINKING FUNDS
25. (1) The Minister shall establish a sinking fund for the
purpose of redeeming bonds or stock issued in respect of a loan
raised under this Act for a period exceeding ten years. (2) The Minister may establish a sinking fund for the purpose
of redeeming bonds or stock issued in respect of a loan raised
under this Act for a period not exceeding ten years. (3) This section does not apply to a bond raised through the
Bank of Zambia. 26. The Minister may establish a sinking fund for the purpose
of redeeming a loan raised by agreement, in writing, under this Act
or under any other written law. 27.

r may establish a sinking fund for the purpose
of redeeming a loan raised by agreement, in writing, under this Act
or under any other written law. 27.

Where a sinking fund is established under section 25 or 26,
the rate of contribution towards that sinking fund shall be an amount
sufficient to provide for the repayment, on the redemption date of
that loan, of not less than seventy five percent of the principal loan. 28. (1) Money shall not be withdrawn from a sinking fund for
any other purpose except for the redemption of a loan in accordance
with this Part. (2) Despite subsection (1), liability management operations shall
be deemed as authorised withdrawals from a sinking fund. 29. Where a sinking fund established under this Part is
insufficient for purposes of repayment of a loan at the time fixed
for repayment of that loan, the deficiency shall be a charge on,
and paid from, the Consolidated Fund. 30.

es of repayment of a loan at the time fixed
for repayment of that loan, the deficiency shall be a charge on,
and paid from, the Consolidated Fund. 30.

The Minister may, by statutory instrument, prescribe the
manner of establishing, managing and controlling of a sinking fund
including—
(a) the establishment of a joint sinking fund relating to two or
more loans; and
(b) in the case of a loan raised partly from a source within
the Republic and partly from a source outside the
Republic, that different sinking funds shall be established
in respect of the different portions of that loan. Establishment
of sinking
funds for
redemption
of bonds or
stock
Establishment
of sinking
funds in
other cases
Contribution
to sinking
fund
Withdrawal
of money
from sinking
fund
Deficiency
in sinking
fund to be
charged on
Consolidated
Fund
Regulations
for sinking
funds
Public Debt Management [No. 15 of 2022 411

om sinking
fund
Deficiency
in sinking
fund to be
charged on
Consolidated
Fund
Regulations
for sinking
funds
Public Debt Management [No. 15 of 2022 411

PART VII
GUARANTEES AND INDEMNITIES
31. (1) Subject to section 32, the Minister may, on terms and
conditions that the National Assembly may approve, guarantee the
repayment of a loan or portion of that loan to a person ordinarily
resident within or outside the Republic, borrowed from that person
by a body specified, or belonging to a class specified, in the First
Schedule. (2) Subject to section 32, the Minister may, on terms and
conditions that the National Assembly may approve, guarantee the
performance of any contractual obligation relating to the payment
of money in favour of a person ordinarily resident within or outside
the Republic, by a beneficiary. (3) A letter of intent, letter of comfort, a similar letter or an
approval by the Minister of a borrowing to be undertaken by a
public body shall not constitute a guarantee or any other form of
legal undertaking by the Government.

e Minister of a borrowing to be undertaken by a
public body shall not constitute a guarantee or any other form of
legal undertaking by the Government.

(4) The Minister shall not issue a guarantee under this section
unless the—
(a) beneficiary in whose favour the guarantee is issued is
capable of repaying the loan and paying interest or other
amount payable in respect of a loan based on a credit
risk assessment; and
(b) the purpose of the loan for which the guarantee is required
is for a project under a National Development Plan
formulated in accordance with the National Planning and
Budgeting Act, 2020. 32. The Minister shall seek approval from the National
Assembly before the Minister issues a guarantee to a person
ordinarily resident within or outside the Republic in accordance
with section 31. 33. (1) A beneficiary shall, where a guarantee is issued to
that beneficiary, pay an upfront amount to the Government in
Zambian Kwacha, of between zero point five percent and two
percent of the guaranteed loan amount based on the credit risk
assessment of the beneficiary, as prescribed. (2) Despite subsection (1), the Minister may, by statutory
instrument, exempt a loan or contract from the payment of a
guarantee fee, or defer the payment of the guarantee fee on
specified terms and conditions. Power to
give
guarantees
Act No.

act from the payment of a
guarantee fee, or defer the payment of the guarantee fee on
specified terms and conditions. Power to
give
guarantees
Act No.

1 of
2020
Approval of
guarantee by
National
Assembly
Payment of
guarantee fee
412 No. 15 of 2022] Public Debt Management

1 of
2020
Approval of
guarantee by
National
Assembly
Payment of
guarantee fee
412 No. 15 of 2022] Public Debt Management

(3) The money collected under subsection (1) shall be paid into
the Consolidated Fund. (4) An agreement providing for a guarantee by the Minister
relating to a loan or contractual obligation as provided under this
section shall come into operation on a date fixed in the terms and
conditions of the agreement as laid before, and approved by, the
National Assembly. 34. (1) The total contingent liability for guarantees issued under
this Act shall not exceed ten percent of the gross domestic product
at current market prices computed for the immediate past financial
year. (2) An account shall not be taken of any interest or other sum
accrued or which may accrue, other than the principal sum, and
which may become payable on a loan or a portion of a loan
guaranteed under section 31 in determining the total contingent
liability under subsection (1). (3) A guarantee issued under section 31 is valid if, the total
contingent liability determined in accordance with subsection (2) is
within the limit specified under subsection (1), at the date when the
guarantee is issued. 35.

ability determined in accordance with subsection (2) is
within the limit specified under subsection (1), at the date when the
guarantee is issued. 35.

(1) A beneficiary shall, where the beneficiary defaults
and Government is required to honour the guarantee, reimburse
the Government for the guarantee given under section 31 including
the expenses incurred by the Government relating to the guarantee. (2) The Minister may, where the Minister considers that the
beneficiary is capable of paying the debt over a period of time,
enter into an agreement with the beneficiary to pay the debt on
terms and conditions set out in the agreement. (3) An amount paid by a beneficiary relating to a guarantee or
a portion of a guarantee under subsection (1) shall be paid into the
Consolidated Fund. (4) Where a guarantee relating to a loan contracted by a
beneficiary is paid by the Government and the beneficiary fails to
reimburse the Government in accordance with this section, the
funds payable by the beneficiary shall be a debt due, and recoverable
by, the Government from the beneficiary. (5) The Minister may, under special circumstances and on the
approval of the National Assembly, write-off the debt referred to
under subsection (4), as prescribed. Maximum
amount of
guarantees
Beneficiary
to reimburse
all costs
Public Debt Management [No.

the debt referred to
under subsection (4), as prescribed. Maximum
amount of
guarantees
Beneficiary
to reimburse
all costs
Public Debt Management [No.

15 of 2022 413

15 of 2022 413

36. The Minister may, by agreement in writing and subject to
the terms and conditions of the agreement, indemnify a person
against a claim from an act or omission on the part of a person or
that person’s servant or agent in the performance by that person or
that person’s servant or agent of an agreement between that person
and the Government. 37. (1) Subject to subsection (2), the Minister shall pay out of
the Consolidated Fund a sum required for discharging the liability
incurred by the Government on a guarantee or indemnity given in
accordance with this Act. (2) The Minister shall not pay out of the Consolidated Fund an
indemnity under this Act without the approval of the National
Assembly. (3) The Minister shall, where money is paid out of the
Consolidated Fund on a guarantee or indemnity, submit a report to
the National Assembly giving details of the payment in accordance
with section 42. PART VIII
POWER TO RAISE GRANTS
38. (1) Subject to this Act, the Minister may raise in the
Republic or elsewhere, on behalf of the Republic or a public body,
a grant that the Minister considers necessary.

s Act, the Minister may raise in the
Republic or elsewhere, on behalf of the Republic or a public body,
a grant that the Minister considers necessary.

(2) Despite subsection (1), the Minister may, by direction in
writing, delegate the power to raise a grant to the Secretary to the
Treasury or a public officer. (3) A public body seeking to raise a grant on the public body’s
own behalf shall seek authority from the Minister. (4) A grant raised under this Part shall be deposited into the
Consolidated Fund or any other public funds or public account. 39. A grant may be obtained for the following purposes:
(a) advancement of national development;
(b) technical assistance or cooperation;
(c) financing of a project or a specified action which is either
wholly financed by that grant, or is partially financed by
other financing means;
(d) operational expenditure; and
(e) any other purpose that the Minister may consider
necessary. Indemnities
Guarantees
and
indemnities
to be paid
out of
Consolidated
Fund
Power to
raise grants
Purpose of
grants
414 No. 15 of 2022] Public Debt Management

ties
Guarantees
and
indemnities
to be paid
out of
Consolidated
Fund
Power to
raise grants
Purpose of
grants
414 No. 15 of 2022] Public Debt Management

PART IX
REPORTS
40. (1) The Minister shall cause a debt sustainability analysis
to be conducted on an annual basis. (2) The Minister shall cause to be published, in a manner that
the Minister considers necessary, a debt sustainability analysis report
by the end of the first quarter of the following year. 41. (1) The Minister shall, once every quarter, cause to be
prepared a debt statistical bulletin that shall provide—
(a) the debt stocks and debt charges of the debt portfolio of
the Government;
(b) the guarantees issued by the Government;
(c) the loans contracted by the Government;
(d) the amounts undisbursed on public and publicly guaranteed
commitments;
(e) the projected debt service on outstanding external and
domestic debt; and
(f) any other information that the Minister considers
necessary. (2) A debt statistical bulletin prepared under subsection (1)
shall be published on the official website of the Ministry responsible
for finance and in any other manner that the Minister may determine. 42.

on (1)
shall be published on the official website of the Ministry responsible
for finance and in any other manner that the Minister may determine. 42.

(1) The Minister shall, within three months after the end
of each financial year, cause to be prepared, an annual public debt,
guarantees and grants execution report for submission to the
National Assembly, which shall include—
(a) information on the debt management strategy and its
rationale;
(b) the effect of the implementation of the debt management
strategy in achieving the debt management objectives;
(c) any deviation from the approved debt management strategy
and the justification for the deviation;
(d) outstanding loan guarantees, the amount guaranteed and
the beneficiaries;
(e) an assessment of the credit risk of outstanding loan
guarantees;
(f)outstanding lending operations of the Government;
(g) outstanding borrowing operations of the Government debt
and debt service paid during the financial year; and
(h) any other information that the Minister may determine. Debt
sustainability
analysis
Debt
statistical
bulletin
Annual
public debt,
guarantees
and grants
execution
report
Public Debt Management [No. 15 of 2022 415

ustainability
analysis
Debt
statistical
bulletin
Annual
public debt,
guarantees
and grants
execution
report
Public Debt Management [No. 15 of 2022 415

(2) The Minister shall publish the annual public debt, guarantees
and grants execution report, within thirty days of submission of the
report to the National Assembly. PART X
GENERAL PROVISIONS
43. (1) A loan shall not be raised for or on behalf of the
Republic or a public body, except under the authority of this Act or
any other written law which specifically authorises the raising of a
loan. (2) The Government or a public body shall not be bound by a
lending contract, a guarantee, indemnity, security or other transaction
where a loan is raised in contravention of subsection (1). 44. The Minister or a person appointed to perform a function
under this Act shall not be obliged to fulfil a trust, whether expressed,
implied or constructive, to which a bond, stock or treasury bill
issued under this Act may be subject, despite the Minister or the
person appointed to perform a function having had notice that the
bond, stock or treasury bill is held subject to a trust. 45. The Minister may, by statutory order, delegate to a public
officer any function conferred on the Minister under this Act as
may be specified in that order, except the function to raise a loan
under Part IV. 46.

fficer any function conferred on the Minister under this Act as
may be specified in that order, except the function to raise a loan
under Part IV. 46.

(1) A public officer to whom a power or duty is assigned
under this Act commits an act of financial misconduct if that public
officer wilfully or negligently causes or permits an unauthorised,
irregular or wasteful misapplication of funds, or wilfully or negligently
fails to exercise that power or perform the duty. (2) The Secretary to the Treasury may, where a public officer
commits an act of financial misconduct—
(a) require that public officer to make additional reporting to
the Treasury on the management and control of public
monies under that public officer or member of the
controlling body’s charge;
(b) require that public officer to avail a financial management
improvement plan to the Treasury for approval; and
(c) impose restrictions over certain categories of expenditure. General
restriction on
raising of
loans
Minister and
other person
not
responsible
for fulfilment
of trusts
attaching to
bonds,
stocks or
treasury bills
Minister
may
delegate
functions
to public
officer
Financial
misconduct
by public
officer or
controlling
body
416 No. 15 of 2022] Public Debt Management

inister
may
delegate
functions
to public
officer
Financial
misconduct
by public
officer or
controlling
body
416 No. 15 of 2022] Public Debt Management

(4) Where a public officer is found guilty of financial misconduct,
the Secretary to the Treasury may recommend to the Secretary to
Cabinet or an appropriate executive authority any of the following:
(a) suspension;
(b) dismissal; or
(c) prosecution. 47. (1) A charge of financial misconduct against a public
officer shall be investigated, heard and determined in accordance
with the statutory or other conditions of appointment or employment
applicable to that public officer. (2) Disciplinary proceedings undertaken under subsection (1),
shall not affect the right to institute criminal procedure. 48. Where an offence under this Act is committed by a body
corporate or unincorporate body, with the knowledge, consent or
connivance of the director, manager, shareholder or partner, that
director, manager, shareholder or partner of the body corporate or
unincorporate body commits an offence and is liable, on conviction,
to the penalty specified for that offence. 49. The Minister may, by statutory instrument, make
Regulations that are necessary for the better carrying out of the
provisions of this Act. 50.

nce. 49. The Minister may, by statutory instrument, make
Regulations that are necessary for the better carrying out of the
provisions of this Act. 50.

(1) The Loans and Guarantees (Authorisation) Act, 1969,
and the General Loan and Stock Act, 1931, are repealed. (2) Despite subsection (1), the Second Schedule applies to the
savings and transitional arrangements. Disciplinary
proceedings
Offence by
principal
officer
shareholder
or partner of
body
corporate or
unincorporate
body
Regulations
Repeal of
Cap. 366 and
Cap. 350 and
savings and
transitional
arrangements
Public Debt Management [No. 15 of 2022 417

or
unincorporate
body
Regulations
Repeal of
Cap. 366 and
Cap. 350 and
savings and
transitional
arrangements
Public Debt Management [No. 15 of 2022 417

FIRST SCHEDULE
(Section 31 (1) )
SPECIFIED BODIES
1. A body corporate established by an Act of Parliament.
2. A local authority established under the Local Government Act, 2019, (Act
No. 2 of 2019).
3. A public utility.
4. A body corporate in which shares are held by or on behalf of the Government.
SECOND SCHEDULE
(Section 50(2))
SAVINGS AND TRANSITIONAL PROVISIONS
1. For the avoidance of doubt, a loan or grant raised before
the commencement of this Act under the repealed Acts shall be
considered to have been raised under this Act.
2. A guarantee or indemnity subsisting at the commencement
of this Act, other than a guarantee or indemnity issued under any
other written law, shall be considered to have been issued under
this Act.
3. The Government debt ceiling referred to under section 11(2)
and the maximum amount of guarantees referred to under section
34 (1), shall only apply after a period of five years of the
commencement of this Act.
418 No. 15 of 2022] Public Debt Management
Continuation
of loan
Continuation
of guarantees
and
indemnities
Government
debt ceiling
and
maximum
amount of
guarantees