By Marc Jones
LONDON (Reuters) -A group of Zambia’s international creditors said on Friday the country would need to provide more details on its recently-agreed IMF support programme and its own economic plans if the two sides were to strike a debt relief deal.
The group, made up of international funds that own the country’s now-defaulted bonds, said it was also crucial that the likes of China, which has also leant heavily to cooper-rich Zambia, provided the same degree of debt relief.
“Inter-creditor equity should also be of paramount importance in the authorities’ approach to restoring debt sustainability,” the group, which calls itself the Zambia External Bondholder Committee, said in a statement.
“To establish a process in which all parties have confidence, the Committee expects the authorities to engage in simultaneous discussions with the Official Creditor Committee for Zambia and the Bondholder Committee with equality of information disclosure for both groups.”
Zambia became Africa’s first pandemic-era sovereign defaulter last November after years of chronic government overborrowing had already left it with far too much debt to repay.
After months of negotiations, last week it provisionally agreed a $1.4 billion, three-year IMF plan that will require it to slash spending and cut politically-sensitive subsidies on power, fuel and farming.
Zambia’s external debt includes around $3 billion in international bonds, $2.1 billion to multilateral lending agencies such as the IMF and another $3 billion to China and Chinese entities.
The bonds that make up that debt have surged this year following the election of a new president keen on an IMF deal and a rise in copper prices, which are now double the level they were when COVID-19 first savaged the world economy.
“The Committee looks forward to engaging with the authorities in a good faith and collaborative manner in the coming weeks,” the bondholder group added.
(Reporting by Marc Jones, editing by Karin Strohecker and Louise Heavens)
