Twelve  years AFTER the 2005 Paris Club Agreement and Six  years after bilateral minutes agreement, Brazil and Zambia have finally signed a US$ 90.7 million or 80% debt write-off.
Before the debt write-off was executed, Zambia owed the South American economic giant a consolidated amount of US$ 113. 4 million of which 80% has NOW been written off , and US$ 22.7 million or 20% rescheduled for repayment in two equal instalments to be paid by March, 2018.
According to the statement released to the media and signed by Chileshe Kandeta, the debt write-off and rescheduling agreement was signed in Brasilia between the Brazilian Secretary for International Affairs, who is also the Vice Minister of Finance, Dr. MARCELLO ESTEVAO, and Zambia’s Minister of Finance, FELIX MUTATI.
Speaking after the signing ceremony held at the Brazilian Ministry of Finance Headquarters, Mr. Mutati said the savings from what would have been full debt repayment will be channeled to support the implementation of poverty reduction programmes outlined in the Seventh National Development Plan [7NDP].
“We are very grateful to Brazil for concluding a process that started way back in 2005,” he stated, adding that, “this agreement will reinforce the relationship between Brazil and Zambia.”
He affirmed that the agreement signified the commencement of a revolution which will lead to thriving development cooperation between the two countries.
“I take this opportunity to reiterate our commitment to execution of the Economic Stabilisation and Growth Programme through which the Zambian Government, under the stewardship of President Edgar Chagwa Lungu, has implemented measures to stimulate enhanced economic growth; sustain the fiscal consolidation process; and, promote financial discipline across all domains of the public service,” stated Mr. Mutati.
Minister Mutati restated Zambia’s keenness in tapping into the world-class competencies of Brazil in agriculture development through private sector driven mechanization and technological transfer initiatives.
AND Dr. Estevao says the parties’ debt write-off and debt rescheduling agreement is a great start to a new phase of development cooperation between Brazil and Zambia.
Dr. Estevao stated that after suffering stagnation, his country was now undertaking structural reforms which have redirected the Brazilian economy to a recovery path with growth projected at 3%, adding that, “this is a good time to sign the agreement and heighten the relationship between the two countries.”
Brazil is at the frontier of technological advancement in the agriculture chain, therefore, “it makes a lot of sence to collaborate in order to boost Zambia’s diversification process,” Dr. Estevao assured Mr. Mutati.
MEANWHILE, the Brazilian Secretary for International Affairs has said his country backs Zambia in her quest to get on an IMF Programme because of the importance that investors, and both bilateral and multilateral cooperating partners attach to endorsements by the IMF through a programme.
Dr. Estevao, a former IMF official who until 2016 served as an economist, researcher, and IMF Mission Chief for various countries for a period spanning over twenty  years, told Mr. Mutati and his delegation that “Brazil will support Zambia when the presentation is made at the IMF.”