Zambia begs China to suspend debt repayments

LUSAKA, Zambia

The Zambia’s ruling Patriotic Front regime says it has in the past few months begged Chinese creditors to suspend payment of debt falling due from May 1 to Dec. 31, the ministry of finance said on Thursday.

Zambia has already asked, unsuccessfully, creditors to defer interest payments on three outstanding dollar-denominated bonds.

Zambia is advancing the coronavirus pandemic as the reason for failing to service debt, hence the fake Covid 19 being churned out by the ministry of health.

“The Government intends to share the burden equitably across its official and commercial creditors,” minister of finance Bwalya Ngandu told anxious bondholders.

Main Chinese creditors include the Export Import Bank of China, China Development Bank, the Industrial and Commercial Bank of China and a few other commercial entities including the Bank of China, Bwalya said in a statement to bondholders.

Central government external debt service on Chinese loans amounts to approximately $426.3 million in 2020 and $428 million in 2021’, minister Bwalya said.

Assuming the debt service suspension requests made by the Zambia were all successful, the maximum amount of 2020 debt service suspended and rescheduled would be $225.3 million, he said.

He said multilateral creditors would be called on to participate by way of fresh financing rather than debt relief.

Recently the Permanent Secretary of the Ministry of Finance said that Zambia’s debt is over 90 percent of GDP. This simply means that if the owner of loans decided to call them, we would need to give away 90 percent of our wealth to pay our creditors.

It means that in 2020, out of the Kwacha47 billion that Zambia Revenue Authority will collect, Kwacha35.92 billion will be spent on debt service; therefore, debt service as a percentage of revenue is 76.4 percent.