Zambia, the first African nation to seek debt relief from Eurobond holders since the onset of the pandemic, aims to reach a restructuring deal with creditors by the end of a six-month interest standstill it’s seeking, Finance Minister Bwalya Ng’andu said.
The government also plans to reach an agreement in principle with the International Monetary Fund over an economic program in the same time frame, he told bondholders in a web-cast on Tuesday.
Zambia’s $1 billion of Eurobonds due 2024 fell 1.5% to 51.28 cents on the dollar by 4:10 p.m. in London.
The southern African nation has over the past decade taken on nearly $12 billion of debt even as growth slowed and foreign-exchange reserves dwindled.
The pandemic accelerated the crisis, prompting the government last week to request an interest-payment holiday from holders of its $3 billion in Eurobonds while it plans a debt restructuring together with its adviser, Last zard Freres.
Zambia wants debt relief from commercial creditors similar to what the so-called Paris Club group of lender nations had agreed to under a G-20 initiative, according to Mr. Ng’andu.
The government’s requests for interest payment suspensions could provide nearly $1 billion in relief, according to a copy of the presentation Ng’andu delivered.
He didn’t take questions from creditors, saying he would respond to written requests.
“We are committed to fair and equitable treatment of all creditors,” he said. “We expect the same level of commitment from creditors.”
Mr. Ng’andu’s time frame to reaching deals with creditors and the IMF might be overambitious.
Eurobond holders want the government to first reach a deal with the International Monetary Fund over an economic program, and a general election scheduled for August next year may complicate that.
Neighboring Mozambique took about three years to restructure its Eurobonds after starting talks with investors in 2016, when it said it targeted a deal three months.
Lazard and White & Case advised that government too.
“Given Zambia’s complex creditor base, the debt restructuring there is expected to take some time,” Gerry Rice, an IMF spokesman, said last week.
Was it $5 million PF government paid those street dealers Lizards from France to restructure Zambian debts 6 months ago?
To the propagandists and evil diasporans, I hope you have now educated yourselves on the difference between a default and restructure. I stay confident that you will grasp these two easy simple English terms.
@KZ
The difference is which ever way you are F.ucked
You have idyots like like Chikwanda who were calling others like Magande and Musokotwane as lunatics when told that they had borrowed too much. Now, Chikwanda and Lungu are so mute when they are the ones that vandalised the economy. They both literally stole the borrowed money putting the livelihoods of millions of Zambians in shambles. We need to bring the death sentence for corruption and stealing public funds. To make matters worse, the other thief, Lungu, is even seeking a third term. What a mother fcker we have in state House.
@Kaizer Zulu. Do you think that people in the diaspora suffer for the wanton and reckless mismanagement of the economy by your PF? No. If anything, they now send more kwacha to their relatives without spending more dollars. It is patriotism that pits the ‘diasporians’ against the unpatriotic PF. UNIP in 27 years left $4 billion debt. PF in 9 years has tripled that. Surely, one must be a real nincompoop not to see the problem.
I am hopping HH loses in 2021…..let lungu continue….
I will be rich with lungu as president beyond 2021……..
A rotten festering economy means our forigne currencies will go a long way.
I expect property prices in zambia to crash soon……
Only people from outside looking long term to settle in Zambia will buy. Those short term investors in property will flee……
We kicked IMF in the back side and send their resident representative packing, now we are licking the same backside without shame.
Let’s learn to live within our means. When are we ever going to lend out? Let’s emulate countries like Botswana
Ooops, just learnt the bond holders have rejected Zambia’s request for deferment of interest payments. We r in trouble.
Where is Br Mumba? Has he given up on the great enterprise? I blame the Zambian education system for producing a lot of brain dead citizens who get swayed to vote for kleptomaniacs by songs produced by illiterate artists.
Skylab I also heard that eurobond program has been declined, we only have one country reason to vote wisely it’s not about tribe now it’s about who can deliver apa manje.
IMF diplomatic-speak is not for everyone. Dream on mates.
The real pf so why are they commenting and crying like pregnant hippos over an economy that doesn’t affect them ? Btw you ain’t no real pf supporter. Stop misleading people. Why can’t you be proud of being a upnd supporter? As for the rest, just listen to yourselves, always moaning moooo mooo mooo like a cow from hhs farm.
Zambia, the first African nation to seek debt relief from Eurobond holders since the onset of the pandemic, aims to reach a restructuring deal with creditors by the end of a six-month interest standstill it’s seeking, Finance Minister Bwalya Ng’andu said.
Why seek debt relief and restructuring deal with creditors if you have the capacity to pay? When u seek restructuring it means you are technically insolvent and you do not have cash to meet interest payments. This is a default and it is immediately reflected in the interest rates and the exchange rate meaning that a huge dark cloud hangs over the future economic prospect for Zambia.