Zambian president wants quick debt restructuring to aid recovery

Zambian President Hakainde Hichilema urged the country’s creditors on Monday to agree to a quick debt restructuring to aid economy recovery efforts.

Hichilema made the remarks during a visit to Zambia by International Monetary Fund (IMF) Managing Director Kristalina Georgieva, who met Hichilema, Finance Minister Situmbeko Musokotwane, central bank governor Denny Kalyalya and other senior government officials.

Zambia defaulted on its sovereign debt in 2020, becoming the first African country to do so during the COVID-19 pandemic.

In August last year it won IMF approval for a $1.3 billion, three-year loan programme intended to help ease pressure on its public finances while it conducts $13 billion restructuring discussions.

“If (the debt restructuring is) not concluded soon, it is going to distort all the good efforts that we have been making to reconstruct the economy and bring investment,” Hichilema told Georgieva, in remarks with reporters present.

He added that if the restructuring was concluded by a government target of the end of the first quarter of this year it could “help a lot to open up areas that are sometimes causing negative sentiment”.

Georgieva commended the government for moving away from wasteful expenditure to use funds more prudently. She said the IMF would like to work with Zambia to boost its economic growth.

Georgieva, who has pushed hard for quicker movement on debt relief, has said she hopes Zambia will become the second nation after Chad to complete a debt treatment process under the Group of 20 major economies’ Common Framework.