Zambia rejects China’s debt restructuring proposal-FT
2023.02.13 01:23
Zambia rejects China’s debt restructuring proposal-FT
By Ray Johnson
Budrigannews.com – The Financial Times reported on Monday that Zambia’s finance minister warned that delays were holding up the economy and rejected a request from China for the World Bank and other multilateral lenders to join a restructuring of the country’s debt.
Situmbeko Musokotwane stated in an interview with the newspaper that “time is of the essence” to complete the restructuring of approximately $13 billion in external debt this year. He also indicated that China’s demand was a distraction from discussions regarding the reduction of the loans.
According to the report, Musokotwane stated, “Discussions at higher levels like those just make our situation worse, because what we are looking for are urgent solutions, not discussions that may drag the matter out.”
A request for comment from Reuters was not immediately responded to by either the Ministry of Finance or the People’s Bank of China.
In 2020, Zambia became the first African nation to default under COVID-19, but the restructuring of its nearly $15 billion in external debts with creditors like China and holders of Eurobonds has been greatly delayed.
At the end of 2021, according to government data, Zambia owed Chinese creditors nearly $6 billion of its total $17 billion in external debt.
Group of Seven members, including U.S. Treasury Secretary Janet Yellen, have become increasingly disenchanted with China’s apparent reluctance to move forward with debt rescheduling for countries in need of assistance. China, on the other hand, argues that multilateral institutions ought to be required to accept reductions in debt.
