Log in
Show password
Forgot password ?
Become a member for free
Sign up
Sign up
New member
Sign up for FREE
New customer
Discover our services
Dynamic quotes 
News: Latest News
Latest NewsCompaniesMarketsEconomy & ForexCommoditiesInterest RatesBusiness LeadersFinance Pro.CalendarSectors 
All NewsEconomyCurrencies & ForexEconomic EventsCryptocurrenciesCybersecurityPress Releases

Zambia says it owed more than $6 billion to Chinese creditors in June

10/07/2021 | 02:21pm EST

LUSAKA (Reuters) -Zambia's government and state-owned companies owed more than $6 billion to Chinese creditors at the end of June, new debt figures published by the government on Thursday showed.

The copper-rich southern African country has been under pressure to publish updated debt numbers since a study released last month by the China Africa Research Initiative (CARI) said Zambia's debt to Chinese lenders was $6.6 billion, around double the amount disclosed by the previous administration.

At the time of the CARI report the new government elected in August responded by saying its debt numbers were "broadly consistent" with the research group's estimate.

In November last year Zambia became the first country on the African continent to default on its sovereign debt during the COVID-19 pandemic. It is in talks with the International Monetary Fund to try to secure a lending programme as a precursor to a debt restructuring.

According to a breakdown by the finance ministry on Thursday, Zambia's central government owed $4.47 billion to Chinese creditors at the end of June, state companies owed $1.34 billion via facilities guaranteed by the government and state power utility Zesco owed a further $0.14 billion not guaranteed by the government.

An additional $225.5 million of interest arrears means total public sector exposure to Chinese creditors was $6.18 billion at the end of the second quarter, the ministry said in a statement.

Earlier on Thursday, Vice President Mutale Nalumango said in parliament that Zambia owed Chinese creditors $5.75 billion, but the finance ministry statement made clear that figure was only debt arranged by Chinese institutions.

Some Chinese entities had participated in facilities arranged by other creditors, the ministry clarified.

The $6.18 billion total exposure to Chinese creditors represents more than 40% of Zambia's total publicly guaranteed and non-guaranteed external debt, which the government put at $14.67 billion at the end of June.

Nalumango said Zambia would restructure its debt in a transparent fashion, without favouritism. As well as Chinese entities, Zambia's external creditors include Eurobond holders, who are owed $3 billion, as well as multilateral lending agencies and foreign governments.

The vice president said the debt stock would be periodically audited and that one such audit was under way.

Asked whether the previous government had understated the debt, Finance Minister Situmbeko Musokotwane said loans amounting to $4.4 billion had been signed but not yet disbursed.

He said President Hakainde Hichilema's administration was in discussions to try to cancel some of the undisbursed loans, without specifying with whom they were contracted.

(Additional reporting and writing by Alexander Winning in Johannesburg; Editing by Alex Richardson, Steve Orlofsky and David Gregorio)

By Chris Mfula

ę Reuters 2021
Latest news "Economy & Forex"
11:36aU.s. ambassador to russia has arrived at russia's foreign minist…
11:36aGerman network regulator says we are currently unable to say whe…
11:31aQUOTES-Top Bank of Canada officials speak after rate decision
11:29aWTO lets China impose tariffs on U.S. in Obama-era case
11:27aExplainer-How Western sanctions might target Russia
11:23aU.S. small cap stocks may be signalling market bottom
11:18aGold falls on firm dollar as Fed verdict looms; palladium rallies
11:17aUK reports 102,292 new COVID-19 cases, 346 deaths
11:14aLighter robots and hi-tech routing - Ocado innovates to deliver growth
11:12aU.S. crude, gasoline stocks build, even as fuel demand surges - EIA
Latest news "Economy & Forex"