ZAMBIA  Debt treatment -      October 13, 2023

Supporting agreements with the international institutions

IMF programme supported by the arrangements under the Extended Credit Facility (ECF) approved on August 31, 2022, in an amount equivalent to SDR 978.2 million (about $1.3 billion)

Download the IMF report ECF document

IMF approved an augmentation of SDR 293.46 million (about $385.7 million) at the completion of the third review, increasing the total access to SDR 1,271.66 million (about $1.7 billion) on June 26, 2024

Total external debt of the country

$20.9 billion as of December 31, 2022, including USD 6.8 billion to external private creditors (32% of the total external debt), $6.3 billion to official bilateral creditors (30%), mostly due to Official Creditors Committee (OCC) members, $3.6 billion to multilateral creditors (17%), $2.6 billion to non-resident holders of domestic debt (12%) and USD 1.7 billion of other arrears (8%).

Accorded treatment

For the OCC, a stock treatment is applied, with the total outstanding amount of principal and arrears due as of December 31, 2022 rescheduled through lowering interest rates and extending maturities until 2043 (“baseline treatment”).

Repayment profile

Rescheduling of the debt stock until 2043 under the baseline treatment.

Specific provisions

Upside treatment: in the event that Zambia upgrades to medium debt carrying capacity (DCC) based on the methodology outlined in the 2017 IMF-World Bank LIC-DSF by the end of its ECF programme, official bilateral creditors would benefit from an “upside treatment” from January 1, 2026 with higher interest rates than those of “baseline treatment” and extending maturities for a shorter period, until 2038.

Comparability of treatment provision

In order to secure comparable treatment of its debt due to all its other external creditors in the scope of the debt treatment, the Zambian Government commits to promptly seek from such creditors a treatment on terms at least as favourable as those on which Participating Creditor Countries have reached consensus. The Zambian Government shall, on a quarterly basis, inform the Creditor Committee, through its Secretariat and its Chairs, on the progress of negotiations with other creditors from the date of the signing of the MoU.

Cut-off date

March 24, 2020

Organisation of the session

Key dates:

- Staff-Level Agreement: December 3, 2021

- Formation of the OCC: June 16, 2022

- OCC financing assurances: July 18, 2022

- IMF programme approval: August 31, 2022

- Agreement-in-principle (AIP) on main terms: June 22, 2023

- IMF 1st Review: July 13, 2023

- Agreement on the MoU: October 13, 2023

- IMF 2nd Review: December 20, 2023

 

Members of the Official Creditors Committee

- OCC co-chairs: CHINA, FRANCE

- OCC vice-chair: SOUTH AFRICA

- OCC members:

  • BELGIUM
  • CHINA
  • DENMARK
  • FRANCE
  • INDIA
  • ISRAEL
  • ITALY
  • JAPAN
  • NETHERLANDS
  • RUSSIAN FEDERATION
  • SAUDI ARABIA
  • SOUTH AFRICA
  • SWEDEN
  • SWITZERLAND
  • UNITED KINGDOM
  • UNITED STATES OF AMERICA

 

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