AFRICAs second largest copper producer Zambia is at verge of debt distress, Zambia Institute for Policy Analysis and Research – ZIPAR Senior Research Analyst Caesar Cheelo said. Zambia is likely to default on its external debt obligations if it doesn’t manage it macroeconomic situation.
Mr. Cheelo said the country has amassed so much debt that has made the International Monetary Fund nervous hence the failure to close the $1.3billion package deal which it seems as some form of indirect borrowing too.
Official data from ministry of finance reveal Zambias external debt as standing at $7.34billion which has nonetheless been disputed by analysts that have questioned the debt unit of the MOF for not including project finance component of the obligation which should push the reported number higher.
Zambia has three dollar debt running to the tune of just over $3billion for maturity in 2022,2024 and 2027. The southern African nation has for close to 8 quarters (2years) been trying to get financial assistance from the IMF whose wait has caused an investor weariness manifesting in asset selloff that has put excessive pressure on the local currency the Kwacha.
As at 5pm on 06 Sept. Zambias dollar debt was trading for between 6.03% – 7.78% on the international capital markets.
More articles on Zambias debt position.