Minister of Finance and National Planning Situmbeko Musokotwane says the debt restructuring agreement will enable the country pay its official creditors US$750 Million for the next ten years compared to the US$ 6.3 billion that was supposed to be repaid in the same period.

Mr Musokotwane says the agreement is a significant debt relief to the country as it will channel some of the resources in different sectors of the economy by embarking on developmental projects and investment programs that will be generating revenue for the country.

He noted that the previous contractual arrangements did not serve well for the country adding that close to 40% reduction of debt burden was recorded as a result of the postponement of repayments and a reduction in interest rates.

The Minister said this in parliament when he gave an official statement on the debt restructuring agreement.

“The postponement of payments through extended maturities will generate about US $5.8 billion in debt service savings over the period 2023-2031. Therefore, Zambia will be paying its official creditors about US $750 million only over the next ten years, compared to about US $6.3 billion that was supposed to be re-paid in the same period, under the previous contractual arrangements.

“In economic terms, or should I say considering the time value of money as described in the IMF’s Debt Sustainability Framework, the agreement delivers close to 40 percent reduction of our debt burden as a result of the postponement of repayments and a reduction in interest rates,” the Minister explained.

Mr Situmbekko added that the agreement with the official creditors has several benefits for the country adding that one of them is that It will generate US$5.8 billion in debt service savings which unlock resources that can be utilized for our developmental programs.

He explained that the agreement will also unlock extra funds from cooperating partners stating that this year both the International Monetary Fund IMF and the World bank will disburse funding to Zambia amounting to US$188.8 million and US$75 million respectively.

Mr Musokotwane said this will result in positive cash flow for the country as opposed to the situation without a debt restructuring agreement in place.

“It is true that debt servicing will resume in three years, the effect of the restructuring reduction in principal payable due to stretching the maturity as well as lower interest rates means that the annual cost for debt servicing will be very low. This means that Zambia will enjoy positive cash flow when one compares the debt outflows versus the debt inflows and the extra cash will be available for development,” Mr Musokotwane noted.

He said the agreement will also provide a pathway to restoring debt sustainability in the medium term, thereby leading to an improved macroeconomic environment in particular the impact on exchange rate stability should be tangible.

Mr Musokotwane further noted that some of the locally issued treasury bonds are bought by non-residents who bring in foreign exchange and that before the restructuring agreement was reached many new investors in the bonds held back their foreign exchange.

He said the government is keen on ensuring that the country should never find itself in a position of unsustainable debt accumulation adding that It is against this background that the Public Debt Management Bill was introduced in parliament which requires the executive arm of government to seek authority to borrow funds from the Legislature through the Annual Borrowing Plan.

“Allow me to express the government’s gratitude to all our official bilateral creditors for the favourable debt restructuring agreement that was reached on 22nd June 2023. Special thanks go to the Co-Chairs, France and China as well as South Africa who were the Vice Chair of the creditor committee. We are also indebted to the Paris Club Secretariat for their unwavering support. I would also like to extend our heartfelt gratitude to the International Monetary Fund and the World Bank that have stood with us during this period, “Mr Musokotwane stated.

Central Province Permanent Secretary, Milner Mwanakampwe has challenged the Tanzania Zambia Railway Authority (TAZARA) to improve its operations in view of the support the railway company has recently received from the government.

Mr Mwanakampwe said the government has cleared the debt in form of salary and pension arrears that TAZARA was grappling with to ensure that the company operates smoothly.

” You are aware colleagues that TAZARA was in arrears starting from the time the New Dawn administration took over the government. His Excellency the President saw it necessary that first of all he needed to attend to the retirees and secondly finish the arrears that you were grappling with. So, it calls for you now to double your efforts in terms of input and performance,” Mr Mwanakampwe said.

Mr Mwanakampwe said this when he toured the TAZARA exhibition stand at the Kapiri Mposhi District Agricultural and Commercial Show.

He stated that there is need for TAZARA to be operationally sound as the railway company is strategic to the actualisation of the government’s desire to remove heavy cargo from the road to the railway in order to preserve the lifespan of roads in the country.

” You are aware that President Hichilema is a proponent of removing heavy cargo from the road to the rail because that’s the only way we are going to preserve the lifespan of the roads. We are praying that when cargo is given to TAZARA you will not sleep on duty but work tenaciously. Both TAZARA and Zambia Railways should be able to haul the cargo that will be given to them,” Mr Mwanakampwe said.

But TAZARA Head Commercial, Sydney Bwali informed the Permanent Secretary that the railway company has ventured into other enterprises such as quarrying, production of farm implements and building materials and is currently running a construction unit to augment its revenue base to improve its operations.

Mr Bwali explained that the additional enterprises are helping in sustaining operations at the railway company.

” We are a transporting company but apart from that we also have other business units. We have a quarry at Mununga where we produce quarry products, we also have workshops in Mpika where we produce various farming implements and building materials and we also have a construction unit and right now we are in Eastern Province where we repair bridges,” Mr Bwali said.

Mr Bwali disclosed that the railway company is in the process of hiring six more locomotives to increase its haulage capacity and respond to the government’s call of removing heavy cargo from the road to the railway.

Meanwhile, Mr Bwali commended the government for bailing-out TAZARA with funding to dismantle salary arrears and payment of outstanding pension benefits to its former employees.

He explained that due to government’s intervention, TAZARA is now current in the payment of workers’ salaries.

” We want to thank the government for coming on board to assist TAZARA in terms of dismantling salary arrears and outstanding pension benefits to the former workers and operational costs,” Mr Bwali said.

Recently the government released K72 million to clear outstanding retirement benefits to former workers at the TAZARA.

Konkola Copper Mines (KCM) has shut down its Nchanga Copper Smelter in Chingola for 21 days following a molten metal leakage incident from one of the furnaces.

In a media statement, KCM Plc Provisional Liquidator Ms Celine Nair stated that no loss of life or injuries to employees was recorded during the incident which occurred on Monday.

She said the shutdown period will be used to conduct repairs to the furnace, before commencing system heating-up to restart the processing plant.

Below is the full statement

Konkola Copper Mines Plc (KCM) informs business partners and stakeholders that the Nchanga smelter, which is operated by its subsidiary, KCM SmelterCo Limited has been shut down to facilitate repair works following a molten metal leakage from one of the furnaces.

There was no loss of life or injuries to employees during the incident. Around 07:30 hours on Monday, 26th June 2023, furnace parameters as read by the operator from the distributed control system (DCS), showed signs of metal leak. All employees were immediately evacuated to safety before the metal leak in line with protocols implemented at the Nchanga smelter, which worked well.

The area was then barricaded to ensure safety and the KCM Fire Department was alerted about the incident.

KCM Plc Provisional Liquidator Ms Celine Nair stated that “KCM has now commenced a 21-day smelter shutdown to repair the Flash Smelting Furnace (FSF), and eventually stabilize smelter operations. The shutdown period will be used to conduct repairs to the furnace, before commencing system heating-up to restart the processing plant.”

During this period, the acting Chief Executive Officer (CEO), Mr Enock Mponda, added that KCM will rely on acid from the 500-tonnes-per day acid plant at Nchanga operations to feed the Tailings Leach Plant (TLP) for copper processing, and procure additional acid in order to plug the gap of acid production from the smelter.

Issued by Shapi Shachinda – General Manager Corporate Affairs

The government has announced that the temporary shortage of fuel in Kitwe, which has inconvenienced residents, will be resolved within the next two days. Ministry of Information and Media Director Spokesperson, Thabo Kawana, confirmed that Indeni Energy Company Limited would intentionally increase the supply of petrol to Oil Marketing Companies in Kitwe.

Expressing regret over the inconvenience caused to Kitwe residents, Mr. Kawana assured the public that the government is taking swift action to address the issue. He also urged Oil Marketing Companies to ensure they have sufficient petrol stocks and emphasized the government’s commitment to monitoring their operations.

The Oil Marketing Companies Association of Zambia attributed the ongoing fuel shortage in some parts of the Copperbelt to thin profit margins against the cost of importing the product, which has made it currently unattractive for these businesses, causing a slowdown in supply.

Some Kitwe residents voiced their concerns, calling on the government to closely monitor the activities of Oil Marketing Companies to ensure an adequate supply of petrol. Chilufya Mushota, a motorist who was among those queuing for petrol, expressed confusion as to why Kitwe specifically faced a shortage while the rest of the country had sufficient petrol stocks.

In response to these concerns, Ministry of Information and Media Director Spokesperson, Thabo Kawana, visited various filling stations in Kitwe to assess the fuel situation, particularly with regard to petrol. During his visit, he assured residents and stakeholders that the situation would improve. Indeni Energy Limited Company has increased its supply of petrol to the Oil Marketing Companies, and by Thursday or Friday, the situation is expected to normalize.

The Zambia Chamber of Mines (ZCM), an association that represents the Mining and Allied industry congratulates the Republican President, His Excellency , Mr.
Hakainde Hichilema and Zambia’s Finance Minister Honourable Situmbeko Musokotwane for the successful renegotiation of the sovereign official bilateral debt
under the G20 framework.

In commending the outcome, Chamber of Mines President, Dr Godwin Beene, stated that this agreement opens doors to further progress in availing the Zambian Treasury
more room to apply resources to the restoration of broad economic growth to levels that spur tangible development at all levels. The agreement also sets in motion the process of availing Zambian businesses access to fairly priced capital as underscored by the Head of State.

The Chamber President applauded the steadfast resolve that the Government leadership has demonstrated in getting to this hard-won milestone.

“This access will come about as global perceptions correct to align with the confidence that the Chamber membership and wider local mining industry has that
the new dawn government will continue to deliver on its commitment to availing an optimal investment environment over time.” Dr Beene said.