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Lusaka’s Plan to Get Back on its Feet

Zambia, the first African nation to seek debt relief from Eurobond holders since the onset of the pandemic, aims to reach a restructuring deal with creditors by the end of a six-month interest “standstill” it is seeking, finance minister Bwalya Ng’andu said on Tuesday. The government also plans to reach an agreement in principle with the International Monetary Fund (IMF) over an economic programme in the same time frame, he said in a webcast on Tuesday. Zambia’s $1bn of Eurobonds due in 2024 fell 1.5% to 51.28c on the dollar by 4.10pm in London. The country has over the past decade taken on nearly $12bn of debt even as growth slowed and foreign-exchange reserves dwindled. The pandemic accelerated the crisis, prompting the government last week to request an interest-payment holiday from holders of its $3bn in Eurobonds while it plans a debt restructuring together with its adviser, Lazard Freres. Zambia wants debt relief from commercial creditors similar to what the so-called Paris Club group of lender nations had agreed to under a G20 initiative, according to Ng’andu.