News Column

Zambia : ZAMBIA'S debt stands at US $4.2 billion

June 16, 2014

Government maintained that Zambia s external debt stands at about US $4.2 billion including the Euro Bond.

Ministry of Finance Public Relations Officer, Chileshe Kandeta, said that the treasury at this level the ratio of Debt to GDP is about 17.8% of GDP, which is way below the internationally agreed sustainability level of 40%.

The government is mindful of the need not to fall back in a debt trap and will be careful with any future borrowing to ensure sustainability and investment of any borrowing in high return growth areas.

It was also revealed that foreign reserves stand at about US $3.5 billion from US $2.7 billion which is around 3.8 months of import cover and that the goal is to go to 4 months import cover in medium term.

Zambia is paying US $42 million annually on the first US $750 million Euro Bond and US $82 million per annum on the new US $1 billion Bond.

The bonds will be repaid as a bullet repayment in 2022 and 2024 for the US $750 Million and US $1 billion Bond respectively.

This adds that in terms of preparing for repayment, the government is in the process of establishing a sinking fund for the Bonds.

The copper price is improving; currently it is just below US $7,000 per metric.

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Source: TendersInfo (India)

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