LUSAKA – Zambia, Africa’s first economy to default during the coronavirus pandemic, announced Friday that it had officially applied for restructuring under the G20 debt suspension initiative for the world’s poorest countries.
The copper-rich country, which saw its external debt bulge to nearly $12-billion last year, has missed two interest payments over the past three months.
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Late last year, it failed to pay $42.5 million in interest due on a Eurobond and on January 30 it skipped a $56.1-million payment on another bond.
“Zambia is committed to transparency and equal treatment of all creditors in the restructuring process and our application to benefit from the G20 common framework will hopefully reassure all creditors of our commitment to such treatment,” Finance Minister Bwalya Ng’andu said in a statement.
The leaders of the world’s 20 richest nations last year agreed on a moratorium allowing poorer countries to temporarily stop servicing eligible debt to focus resources on combatting the coronavirus crisis under the so-called Debt Service Suspension Initiative (DSSI).
Zambian government officials are also due to hold talks with the International Monetary Fund (IMF) on 11 February to negotiate an extended credit facility.