MOROCCO: Zambia is close to signing a long-sought debt agreement with its foreign creditors, an International Monetary Fund (IMF) spokesperson said on Thursday after the institution’s chief prematurely announced it was inked.
Zambia reached a deal in principle with creditors, which include China and Western countries, on 6.3 billion dollars of its debt in June but it has yet to be inked.
The managing director of the IMF, Kristalina Georgieva, announced at the IMF-World Bank annual meetings in Marrakesh, Morocco, on Wednesday that a memorandum of understanding (MoU) between Zambia and its lenders has finally been inked.
But an IMF spokesperson later said the deal was nearly finalised and the signing is likely soon.
“A round of applause for Zambia,” Kristalina Georgieva said after making the mistaken announcement at a panel discussion on tackling debt around the globe that also featured Zambian Finance Minister Situmbeko Musokotwane.
Musokotwane said that the creditors have been wonderful. He thanked a committee of lenders led by France, China, and South Africa.
He said that however, that by itself is not enough to provide the kind of life that these young generations in Africa want to live. What will deliver that? Higher economic growth to create employment so that we no longer have young generation crossing the Sahara, over the Mediterranean.
Zambia’s default
Zambia, whose total debt amounted to 32.8 billion dollars at the end of 2022, defaulted on its 18.6 billion dollars foreign debt in 2020 at the height of the Covid-19 pandemic.
Concerns over debt in low-income countries has been at the forefront of negotiations of the IMF-World Bank meetings in Marrakesh, the first to be arranged in Africa since 1973.
Central banks worldwide have raised interest rates in efforts to tame inflation, which rose after the pandemic restrictions were lifted and jumped higher after Russia attacked Ukraine.
