Zambia Seeks Restructuring After ‘Over-Ambition’ on Debt

Zambia is seeking to restructure its debt after years of “over-ambition” in borrowing to plug an infrastructure deficit, Finance Minister Bwalya Ng’andu said, Bloomberg News reported. The southern African nation has stopped taking on new commercial debt and is seeking to cancel some loans that it’s contracted but not yet received, he said in an interview with the state broadcaster on Sunday. Zambia also aims to restructure loans already disbursed as the government strives to achieve debt sustainability that would allow it to tap emergency financing from the International Monetary Fund, he said. It’s Ng’andu’s strongest admission yet that Zambia’s debt has surged to unsustainable levels. He also referred to restructuring to describe what the government has so far called a “liability management exercise” of its external debt. The finance ministry is seeking financial advisers for this process, which will include all of Zambia’s external debt. The global economic crisis caused by the spread of the coronavirus is exacerbating economic risks in Africa’s second-biggest copper producer. Read more