GOVERNMENT has so far accumulated US10 million in the Sinking Fund to use towards redeeming the Euro bond, Finance Minister Bwalya Ng’andu has announced.
Dr Ng’andu told Parliament that the fund, set up in 2018, was one of the options Government intended to use towards redeeming the Euro bond.
He indicated that Government, through the Ministry of Finance, had also set up a technical committee to draft a strategy for redeeming the three Euro-bonds but was currently awaiting approval by Cabinet before implementation.
He also observed that the measures Government was undertaking towards the redemption process had no adverse effects on the fiscal performance of the current budget, as it was already provided for in the 2019 budget.
The minister was responding to Solwezi West Member of Parliament, Teddy Kasonso, who wanted to know the measures Government was taking to ensure that the Euro Bonds were paid when they fell due.
“The strategy towards the redemption of the three Euro-bonds, which is yet to be approved by Cabinet, identifies various options available, once Cabinet grants approval, the Ministry of Finance will implement the recommended measures and currently there is US$10 Million in the Sinking Fund which is one of the options,” Dr Ng’andu said.
He named the major components of the public debts as external debt, domestic debt and Government arrears.
Dr Ng’andu indicated that external debts and domestic debts would be paid when due in accordance with the respected financing arrangements, while Government arrears would be dealt with in an annual budget provision.
“Payment of debt is prioritized and the reason for that is to ensure that there is no default of the debt. The debt service takes precedence on the consolidated fund of the budget,” he said.