Questions over Zambian, Congolese debt make it harder for other African countries to borrow
Lagos — African Eurobond issuers face more scrutiny in the wake of questions about the true extent of the debt loads of Zambia and the Republic of Congo. Few investors expect the situation in either country to be as bad as that in Mozambique, where the discovery of hidden loans two years ago triggered a financial crisis and sovereign default. Still, several are querying whether their external liabilities are greater than public figures suggest. Zambia, Africa’s second-biggest copper producer, denied on Friday that it was hiding debt and showed budget documents detailing borrowing. The Republic of Congo also denied concealing debt. The questions may complicate funding plans for African governments and companies. Rising geopolitical tension in the Middle East and Russia, and a tightening of monetary policy in the US, are making conditions tougher for emerging-market borrowers and prompting investors to be more scrupulous. "In a rising tide, all boats are lifted," said Ronak Gopaldas, ...
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