PMRC Questions Sinking Fund

As the deadline for the repayment of the first Eurobond approaches the Policy Monitoring and Research Center (PMRC) has called on the Ministry of Finance to provide an update on the Sinking Fund that was set up to prepare for repayment.

The Eurobonds will see around US$750 million debt mature in 2022, followed by US$1 billion in 20204 and US$1.25 billion between 2025 and 2027.

In October 2019 Finance Minister Bwalya Ng’andu announced that Government had allocated US$50 million to the Fund, which was set up in 2018. However, PMRC Executive Director Bernadette Zulu has noted the recent silence on the Fund and has advised that the Ministry should continue to engage with the IMF regarding technical assistance and bailout packages.

Earlier this month Ng’andu confirmed that Zambia’s external debt stock continues to rise and now stands at US$11.2 billion.

Organizations such as the African Development Bank have recently warned that the country is at high risk of debt distress and the Economics Association of Zambia President Lubinda Haabazoka has previously warned that servicing the debt would cost around US$800 million in 2019.