Zambia requests debt restructuring under G20 common framework

Zambia’s President Edgar Chagwa Lungu addresses the 74th session of the United Nations General Assembly at U.N. headquarters in New York City, New York, U.S., September 25, 2019. REUTERS/Lucas Jackson

JOHANNESBURG (Reuters) – Zambia, which became Africa’s first pandemic-era sovereign default late last year, said on Friday it had officially requested to restructure its debt under a new common framework supported by the Group of 20 major economies.

A number of African nations have seen their already precarious debt burdens aggravated by the economic fallout from the global pandemic. Zambia failed to make payment of a coupon on one of its dollar bonds in November, sending it officially into default.

After initially offering temporary debt relief, including the suspension of service on debt to official creditors, the G20 adopted a framework that encourages governments to defer or negotiate down external debt.

“Zambia is committed to transparency and equal treatment of all creditors in the restructuring process,” Finance Minister Bwalya Ng’andu said in a statement.

“Our application to benefit from the G20 Common Framework will hopefully reassure all creditors of our commitment to such treatment.”

All G20 and Paris Club creditors are expected to coordinate their engagement with Zambia via the common framework, the statement said.

Zambia is due to begin negotiations to establish and programme with the International Monetary Fund next week.

Zambia’s sovereign dollar bonds hovered unchanged at just over 50 cents in the dollar.

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