China Will Come Around On Debt Restructuring – Nkulukusa

Treasury Secretary Felix Nkulukusa has predicted that China will assent to restructuring Zambia’s debts, following internal consultations by the Chinese government. 

“I went to China myself with the minister of foreign affairs and China indicated they were coming on board and they are just making internal consultations,” he told Reuters. 

China owns $5.7 billion - roughly 22% - of Zambia’s foreign debts and has in the past indicated that it would be open to restructuring talks to ensure a more sustainable repayment plan for Zambia. 

On March 19, foreign ministers from both countries held talks on possible restructuring, with Zambia’s embassy in Beijing saying in a statement that, “the two sides applauded the excellent relations that exist between Zambia and the People’s Republic of China.”

Yesterday, Mr Nkulukusa said the government was “waiting for the official creditor committee to be formed and then we will present the debt sustainability analysis.”

Finance Minister Situmbeko Musokotwane told parliament on March 25 that the creditor committee would be announced within a few weeks. He also said yesterday that Zambia could expect a formal deal with the International Monetary Fund by the middle of the year, following the $1.4 billion staff level agreement confirmed in December 2021.