IMF ‘hopeful’ Zambia to announce debt deal with creditors before Thursday

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© Reuters. IMF African Department Director Abebe Aemro Selassie speaks during an interview with Reuters at the annual meeting of the International Monetary Fund and the World Bank, in Marrakech, Morocco October 9, 2023. REUTERS/Susana Vera

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By Rachel Savage and Jorgelina do Rosario

MARRAKECH (Reuters) – The International Monetary Fund’s (IMF) Africa director said on Monday that he was “hopeful” that Zambia and its official creditors would announce a finalised debt restructuring deal before Thursday.

“We’re very hopeful that the authorities and the creditors will be in a position to make an announcement very, very soon,” Abebe Selassie told Reuters in an interview on the sidelines of the IMF and World Bank annual meetings in Marrakech.

“They’ve told us that there’s been very strong progress, that they’re in the last stage of finalising things.”

Zambia became the first African country to default in the COVID-19 pandemic era in 2020 and its restructuring under the G20’s Common Framework process has been beset by delays.

It clinched an agreement in June to restructure $6.3 billion in debt owed to governments abroad including China and members of the Paris Club of creditor nations. To formalise the debt deal, Zambia has to sign a memorandum of understanding (MoU) with these official creditors.

Zambia’s Finance Minister Situmbeko Musokotwane said in late September that he expected the MoU to be “finalised and executed before the end of the year.”

Last week, Zambia’s international bondholders formally started debt talks with the government, three sources told Reuters, a key step in restructuring more than $3 billion of overseas bonds.

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