The referendums may be held as late as January because Russian troops haven’t taken full control of the areas the Kremlin seeks to claim as its own
The UK’s monetary policy committee is hardly on top of the situation when inflation is running at more than five times its 2% target
They hope the magic mushroom sector can avoid the mistakes made when marijuana became legal
Zambia’s reorganisation of as much as $17.3bn of external debt is being delayed by a single foreign creditor, according to UK minister for Africa Vicky Ford.
“We’ve got one creditor that seems to be — one international creditor — that seems to be taking a bit more time to make a decision,” Ford, who is visiting Zambia, said in comments broadcast on Hot FM radio, on Thursday in Lusaka. “I discussed that with the foreign minister as well last night, and I know that he has been working incredibly hard to try to speed up that process.”
Zambia, which became Africa’s first pandemic-era sovereign defaulter in 2020, has been seeking to restructure its dollar obligations under the Group of 20’s (G20’s)Common Framework, a set of guidelines that the most powerful countries drafted to mitigate debt crises in poorer states. Under those rules, Zambia first needed to reach a preliminary bailout deal with the International Monetary Fund, which it did in December.
Disagreements among official creditors or prolonged negotiations with private lenders could delay an eventual restructuring deal and IMF approval into the second half of 2022 or even into 2023, Fitch Ratings said this week.
Zambia’s $1bn in Eurobonds due April 2024 have fallen 6% in 2022 to trade at 74c on the dollar by 10.23am in London.
Zambian finance minister Situmbeko Musokotwane on December 15 asked bilateral lenders to form an official creditors committee as soon as possible. That’s yet to happen, even as the IMF and World Bank have since completed a debt sustainability analysis that sets the economic criteria used in negotiations for debt treatment.
Ford didn’t identify the creditor that she said has been delaying the process.
Out of Zambia’s total $17.3bn of external public-sector debt, commercial and state-owned Chinese lenders account for $5.5bn, making the nation by far the biggest source of Zambia’s loans, according to finance ministry data. Zambia owes $3.3bn in Eurobonds and interest arrears since it defaulted at the end of 2020 and stopped servicing almost all other international loans. It also has a $147m debt to Russia’s export-import bank.
The Chinese Embassy in Lusaka and the Finance Ministry didn’t immediately respond to emails seeking comment. Chinese creditors were “puzzled” about Zambia’s restructuring plans, the nation’s ambassador to Zambia, Li Jie, said in November.
Zambia had been targeting a deal with creditors in the first half of this year, to have its $1.4bn deal with the IMF concluded by June. There has been behind-the-scenes work to establish an official creditors committee co-chaired by China and SA, Eurasia Group said in a note to clients last week.
SA is still finalising its delegation for the creditor committee for Zambia, the Treasury said in reply to emailed questions on April 4.
Ford said she’d be discussing with the IMF and World Bank how to expedite Zambia’s debt treatment at their spring meetings in Washington from April 18-23.
“I’m really encouraging them to say: How can we get this process going faster?” said Ford. “Because the longer it’s going, the more that overhang of uncertainty is going to impact on people here.”
More stories like this are available on bloomberg.com
Would you like to comment on this article? Register (it's quick and free) or sign in now.
Please read our Comment Policy before commenting.
Published by Arena Holdings and distributed with the Financial Mail on the last Thursday of every month except December and January.