A finalized debt restructuring deal between Zambia and its official creditors would be announced before Thursday, the director of the International Monetary Fund’s (IMF) Africa region said on Monday, adding that he was “hopeful” of this.
Abebe Selassie told Reuters in an interview on the sidelines of the IMF and World Bank annual meetings in Marrakech, “We’re very hopeful that the authorities and the creditors will be in a position to make an announcement very, very soon.”
“They’ve told us that there’s been very strong progress, that they’re in the last stage of finalising things.”
In the COVID-19 epidemic era, Zambia became the first African nation to default in 2020, and delays have plagued its reorganization under the G20’s Common Framework procedure.
It reached a deal in June to restructure $6.3 billion in debt owing to foreign governments, including China and Paris Club members. Zambia must sign a memorandum of understanding (MoU) with these official creditors to formalize the loan agreement.
Situmbeko Musokotwane, Zambia’s finance minister, predicted that the MoU would be “finalized and executed before the end of the year” in late September.
A crucial step towards restructuring more than $3 billion in foreign bonds was taken last week when Zambia’s international bondholders formally began debt discussions with the government, according to three sources cited by Reuters.
