Thursday, March 28, 2024

China committed to joining Zambia creditor committee -IMF’s Georgieva

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China has committed to joining Zambia’s creditor committee, International Monetary Fund managing director Kristalina Georgieva said on Thursday, amid complaints from Zambia’s finance minister about delays to its debt restructuring.

People’s Bank of China governor Yi Gang said that China intended to co-chair the committee, two sources with knowledge of the International Monetary and Finance Committee meeting told Reuters.

“We were very pleased to hear from Governor Yi Gang… a very specific commitment to join the creditor committee on Zambia and work expeditiously for debt resolution,” said Georgieva at the International Monetary Fund (IMF) Spring Meetings.

She added that he had also committed to the Common Framework debt restructuring process, launched by the Group of 20 (G20) leading economies in 2020 in response to the coronavirus pandemic.

Zambia’s finance minister Situmbeko Musokotwane said at public events on Thursday that the debt restructuring process had “stalled” and that the Zambian team had “come here to complain.”

An IMF spokesperson said that they did not have any more details of Yi’s statement, noting that it was at a closed door meeting.

“This augurs well, for coordination, in resolving debt for various African countries,” Zimbabwe’s finance minister Mthuli Ncube tweeted of the Chinese position.

Ethiopia and Chad also signed up to the Common Framework more than a year ago and have yet to receive debt relief.

“China is a very significant lender to many of these low-income countries, and China needs to participate, along with the Paris Club and private creditors,” U.S. Treasury Secretary Janet Yellen said at a press conference before Georgieva’s.

“I’ve called on China to specifically for example participate right away in a meeting for Zambia that wishes to undergo debt restructuring. And I am hopeful that China will agree to play a more constructive role.”

China and Chinese entities held $5.78 billion of Zambia’s debt at the end of 2021, according to the most recent Zambian government data.
Earlier, Dr Musokotwane complained over lack of progress on debt restructuring.

“We’ve been waiting for the committees to sit,” Dr. Musokotwane told IMF African Department director Abebe Selassie but added that the process has stalled.

“And while we are here I hope we can get some clarity from you and your colleagues from the World Bank on how we can move forward. Because for now it is stalled,” he continued.

Zambia reached a staff level agreement with the IMF on a $1.4 billion, three-year credit facility in December 2021.

Dr Musokotwane, who also described the restructuring as a “stalemate,” told parliament on March 25 that the creditor committee would be announced “within the next few weeks” and has said he hopes for a formal IMF deal by mid-year.

Selassie had asked what the international community could do to address what he described as the “unresolved… debt challenge.”

6 COMMENTS

  1. China is stalling progress on debt restructuring……….

    They are hoping to grab assets such as ZESCO and other high vslue assets they bankrolled and run them them selves……..

    That way they milk the country the way they want…………..

    It is happening all over the developing world where the Chinese end up grapping and running assets the way they chose.,……..

    for the benifit of china………..

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  2. The problem the Chinese face , especially in Africa………….

    Is they were borrowing money on the assumption that every nation is as efficient and work like ants like them………….

    That is the Chinese is the Chinese horror show……….finding out the people they borrowed money to are workshy compared to them…………

    Their only option is to grab assets and try to run them them selves………..

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  3. This very, very useless institution. Once silly institutions take a stranglehold they hold sway even when what they do has never made any country any better. Very annoying.

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  4. China’s intentions are good, but what they failed to factor in their borrowing is not every nation works like them……….

    300 Chinese can die in an industrial accident, and its no big deal for them. They carry on like nothing happened. They work like ants.

    Africans and other developing nations work at their own pace……. if at all……..

    Now…… China has not got unlimited borrowing money………like zambia has maxed out its account with China, now they want returns, only to find we are not as efficient as them when working.

    This is where the the west can muscle in on china’s dominance. ………

    If the Chinese are not careful , they will lose a lot of their investments in countries where the west makes the people turn on the Chinese, accusing them of…

  5. Contninued ……

    accusing them of holding up western aid, as in this case…….

    I am not against the Chinese, but then again I live in the west, and I don’t see any black person allowed to hold high office in China , so

    Sentiments aside , I know where my allegiance lies …………

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