Zambia’s economy is showing signs of recovery having contracted in 2020 due to the adverse effect of the Covid -19 pandemic. The economy is estimated to have grown by 3.6 percent in 2021 from a contraction of 2.8 percent recorded in 2020. Fiscal performance has been challenging over the period 2019 to 2021 as the fiscal deficits where higher than the targeted budget deficits. Although revenues and grants performed strongly relative to targets, Government spending, including amortization were higher than the target. As a result, Government resorted to borrowing to finance the fiscal deficits. Rapid debt accumulation on the backdrop of deteriorating economic fundamentals led to unsustainable debt levels and subsequent accumulation of arrears.