Govt Contracted US$2.9 Billion External debt Between August 2021, January 2024 – Musokotwane

Minister of Finance and National Planning has disclosed that Government has contracted external loans amounting to US$2.9 billion between August 2021 and January 2024.

Speaking in Parliament during the question for oral answer session, Dr. Situmbeko Musokotwane revealed that this includes US$1.3 billion from the International Monetary Fund (IMF) Extended Credit Facility (ECF) and US$1.58 billion from the World Bank.

Dr. Musokotwane also disclosed that Zambia’s Central Government External debt stood at US$12.99 billion as of September 2021.

“Between August 2021 and January 2024, Government signed external loan amounts to US$2.9 billion, which includes US$1.3 billion from IMF Extended Credit Facility and US$1.58 billion from the World Bank. US$1.3 billion drawn from loans contracted between August 2021 and January 2024,” Dr. Musokotwane stated.

He added that for the period between August 2021 to March 2024, US$291.6 million was paid as principal agreements and US$137.5 million as interest payments, bringing the total debt service on external debt to US$429 million.

“For the period end August 2021 to January 2024, total domestic debt contracted by the government amounted to K45.4 billion. This is broken down as K44.63 million through issuance of government securities as net domestic financing and K731 million through contraction of commercial bank loans,” Dr. Musokotwane disclosed.

Meanwhile, Dr. Musokotwane disclosed that Zambia has made significant progress in restructuring debt owed to other private creditors.

He said as at end June 2024, some of the agreements in principle had been reached, with some of the private creditors.

“Government has been implementing a debt service standstill from October 2020, meaning debt service has only been paid to multilateral creditors such as World Bank, African Development Bank (AFDB) and Creditors that provide loans for priority projects normally on concessional basis.”

“As at end June 2024, Government was still engaged in active discussions with respective member of the official creditors committee, on bilateral agreements, once finalized and executed, the bilateral agreements will enable the implementation of the restructuring terms contained in the Memorandum of Understanding,” he said.

He stated that with regards to bond holders, Government had already completed the restructuring of the Eurobonds as at end June 2024, and debt service had resumed.

Dr. Musokotwane was responding to Bangweulu Member of Parliament, Anthony Kasandwe, who wanted to know how much foreign debt the Government owed, as of August, 2021, as well as whether the Government has been servicing the debt, and if so, how much had been paid, as of March, 2024.