Saturday, June 22, 2024

Zambia on track for debt restructuring next quarter -Dr Musokotwane


Zambia is pushing hard to complete the restructuring of nearly $15 billion of external debt in the first quarter of 2023 and is “in active engagement” with its largest bilateral creditor China, Zambia’s finance minister said in an interview at the Reuters NEXT conference.

Zambia defaulted on its sovereign debt in 2020 and the current government, which took power last year, has been on a quest to restructure its loans and rebuild an economy ravaged by mismanagement under previous administrations and COVID-19.

In August, Zambia won International Monetary Fund (IMF) approval for $1.3 billion, three-year loan programme to help it restructure debts which the government said stood at $14.87 billion at the end of June 2022.

Zambia’s Finance Minister Situmbeko Musokotwane told Reuters China had sought clarification from the Zambian government and the IMF on their debt agreement, he said.

“The Chinese… are asking (for) a number of clarifications, which us and the IMF are providing them,” Musokotwane said.

China wants more clarity on the IMF assumptions on which the loan programme is based, he said, since these are meant to form the basis of the restructuring negotiations between Zambia and all its creditors.

An IMF spokesperson said China and other official creditors have had a number of technical questions since its staff report and Debt Sustainability Analysis for Zambia’s programme request were published.

“This technical due diligence is currently ongoing. Fund staff is trying to facilitate that process so that technical issues can be resolved and negotiations can continue to progress,” the spokesperson told Reuters.


Zambia’s much-delayed debt restructuring is seen by analysts as a test case for what are expected to be a spate of defaults in poorer countries that have borrowed heavily not only in the capital markets but also from countries including China.

IMF strategy chief Ceyla Pazarbasioglu said Zambia’s debt restructuring was the real test case for the Common Framework, set up in late 2020 by the Group of 20 major economies.

At the end of 2021, Chinese creditors accounted for almost $6 billion of Zambia’s external debt, which was then $17.27 billion.

Zambia’s government said earlier this month that the Export-Import Bank of China (EximBank) was representing China on the bilateral ‘official creditors committee’.

Asked whether EximBank was also representing Chinese commercial creditors, Musokotwane said EximBank is “the lead negotiator for the Chinese interests”.

Zambia’s Chinese creditors include commercial banks such as Industrial & Commercial Bank of China, Jiangxi Bank and China Minsheng Bank.

China’s Ministry of Foreign Affairs did not immediately respond to a request for comment.

Musokotwane added private creditors were cooperating well in debt relief discussions and there had been a bondholder meeting this week.

Zambia’s government said in October it needs a present value debt reduction by 2027 of $6.3 billion, or 49% of the debt being restructured, to meet IMF targets, a level some international bondholders have previously said would be unacceptable.


Musokotwane also said he hoped to make an announcement by the first quarter of next year about potential new investors in Konkola Copper Mines (KCM) and Mopani Copper Mines (MCM).

“We are hoping that by first quarter of next year we should be there with some of them. And also some of the new investments that are coming from the U.S. and other places,” he said.

Zambia’s previous government put KCM into liquidation in 2019, triggering a legal dispute with its parent company, Vedanta Resources, that is now being settled out of court.

Zambia’s state-owned mining company ZCCM Investments Holdings took over Mopani in 2021 from commodities giant Glencore which mothballed its operations in 2020 due to weak copper prices.

The government is aiming to treble copper production to 3 million tonnes per year within the next decade in Africa’s second largest producer of the mineral.


  1. kkkkkkkk no more stories all we want is to deliver ,soon we will be counting 3 years down the line and nothing tangible has been done.We have heard alot from you guys now it is time to deliver what you promised.When promising there was no time frame because you knew what you were talking about so it is time to get down to business now and stop yapping.MMMM now from soon to first quarter of next year meaning around April next year,mmmmmmm sure guys with things looking sour on the ground.

  2. Musokotwane……. keep dreaming . You will continue negotiating with china until you are out of govt in 2026. Earlier you had made us believe this debt restructuring is a piece of cake for you and your master.

    • Its their first and unprecedented excercise for China. China had hoped to attach assets from defaulters like Zambia. They already did that to Sri Lanka. So, we thank new dawn.

  3. Muleke no kukongola bamakaka our people have suffered enough because of your carelessness in borrowing and you are very bad at paying back those credits

  4. This thing wont just work Sir. Your govt is just in a big mess and the mess will continue.
    1. You have no drugs in the hospitals
    2. You promised to resolve KCM and MOPANI…..You have lamentably failed and and now you and your master are scared of visiting COPPERBELT.
    3. Agriculture is in a mess… You promised 8 BAGS of fertiliser. Now you are giving medas,
    4. Your boss promised that the dollar will be at K5 the day HE is sworn in. Today the dollar is K17.
    5. Today the price of fuel as gone up….to K27 petrol ……when you had promised to bring it down..
    6. Your policemen are ill trained and easily get beaten by villagers.
    7. You bloated the civil service by 40,000 and now you cannot pay the young teachers.
    You were banking on this debt rearrangement which will never…

  5. And Kapala has just announced that load shedding will be back. Six hours each day!!! We are waiting debt restructuring…kikikiki Ni fimba upoke

  6. The upnd government is extremely heartless. If this so call government had the interest of the nation at heart, they would have increased tax collection in the mines from what pf used to collect which is 20% translating to 3.6 billion dollars per year, maybe to 35% or 50% translating to 7.4 billion dollars, which is not the case. Mine companies are getting minerals for free under the new doom government it is therefore impossible to develop. God has blessed Zambia with a lot of minerals yet nothing to show forth the Africa’s second largest copper producer. What a shame
    This new doom government is just here for business.

    • It could even be one of the reasons China is resisting to restructure the debts, who knows!? They might be saying, ” we lend you money to build infrastructure to facilitate mining, then you give mining tax concessions to Westerners who never cared to develop your country and continent for ages! So if you are able to forego billions of dollars in taxes it means you have enough to repay debts!! Just pay as we agreed!!

  7. PF tied you up a mambala. They borrowed commercial. Si masowela the cluelessness that the previous guys had about governance. It was scandal from the day MCS passed.

  8. It could even be one of the reasons China is resisting to restructure the debts, who knows!? They might be saying, ” we lend you money to build infrastructure to facilitate mining, then you give mining tax concessions to Westerners who never cared to develop your country and continent for ages! So if you are able to forego billions of dollars in taxes it means you have enough to repay debts!! Just pay as we agreed!!

  9. We are in saafe hands of this man and his team.The Wailers who borrowed from the street to imprees the gullible,but ultimately got us into this mess are dumbfounded and can only offer pittances of criticisms about FISP,Petrol prices,mines and dams.Educated people know too well that progress shall not come overnight,It shall, though painfully so.Musokotwane and team have intellect,speed and the trust of creditors in their sails,the economy will not implode

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